Monetisation avenues open up for Indian short video apps, ad revenues triple in 6 months

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Indian short video apps are seeing monetisation opportunities with ad revenues tripling in the last six months, and live commerce and virtual gifting picking up as time spent on these platforms increase, according to a report.

The report, Indian Short Form Video: Ready to leapfrog towards monetisation, by consulting platform RedSeer, revealed that the time spent on short video platforms, which was popularised by Tiktok, continues to increase in India accounting for about 9 percent of the overall time spent on content consumption.

While Facebook's short videos and Instagram's Reels continue to dominate in the top 50 cities, its Indian counterparts like Josh and Moj have a significant user base in the tier-2 and tier-3 cities, according to the report.

This is resulting in improved monetisation opportunities for the platforms and also their creators. Ujjwal Chaudhry, the associate partner at RedSeer, said, “If I look at the growth in the last six months, ad monetisation across these platforms has grown 3x. So that route is happening very quickly. And soon there will be a lot more opportunities that the influencers will be able to make.” These opportunities include live commerce and gifting, which has recently picked up.

According to the report, currently, eight percent of the short video users have gifted their favourite influencers. “This trend is expected to shift as much as 38 percent of users willing to gift to influencers in the future,” the report revealed.

While live commerce is nascent in India with gross merchandise value at $100 million, it is expected to grow to $4 billion by 2025 and over $25 billion in 2030 led by short-form video platforms. “Over 8 percent of the total e-tailing in India could be driven by video commerce by 2030,” the report revealed.

However, the Indian platforms are yet to see the success of Tiktok or its rival Instagram when it comes to monetising content.

Since the TikTok ban last year, close to half a dozen Indian short video platforms like Josh, Moj, and MX Takatak stepped up to fill in the void. After the initial spike these platforms saw, Indian players struggled to monetise content.

While the short video platforms contribute to seven percent of the overall time spent on content, it only contributes one percent in terms of ad revenue.

Nikhil Joshi, senior research analyst, RedSeer explained both Instagram and TikTok have been in the ecosystem for some time to create a quality reach that helped them monetise. However, the Indian short video platforms have been in the system only for the last 13-14 months.

Within a short time, these platforms have had tremendous growth, which will help them monetise. “We are already seeing early signs. Brands are coming forward to collaborate for influencer marketing. These platforms offer localised reach for advertisers in smaller cities,” Joshi added.