Eyeing a lion's share in the target marketing and digital advertisement space that is expected have a net worth of around $10 billion by 2020, social media giant Facebook is putting in a chunk of its resources in the area, in hopes of reaping higher revenues.
The company has in the last few months come out with a series of reports in collaboration with global management consultants and is in touch with companies in various sectors, sharing the benefits of advertising on social media with them.
"The opportunity on social media is focussed on driving three types of outcomes for our original equipment manufacturers (OEM) advertisers. Facebook can provide 5 per cent incremental reach over television at one-seventh the cost which is an efficient way of giving additional reach to the customers. It is a targeted personalised reach," Umang Bedi, Managing Director, Facebook India.
In a joint report with Bain & Compnay, Facebook had ealrier said that almost 70 per cent of Indian automobile sales or $40 billion will be digitally influenced by 2020, compared with $18 billion today.
The social media giant is helping various sectors in adopting digital services. Among firms that are recieving assistance from Facebook are BMW, Chevrolet, Ford, Maruti, Tata Housing and other jewellery barnds.
Target marketing is something the company would be concentrating on for the next few years. "The market, at present, is $7 billion which is growing at 8 per cent, by 2020 it would be approximately $10 billion. Among the growing sectors the FMCG, followed by the automobile and ecommerce sectors. There lies a significant opportunity and would be a key focus area on the ad side of the business," Bedi said.
Facebook's auto report, looks at the impact of digital technologies on the automotive industry, finds that digital engineering, 3D-printing, smart sensors and the Internet of Things (IoT), are poised to disrupt auto R&D, manufacturing, sales, marketing and after-sales services. Social media will influence about 40 per cent of sales valued at $23 billion by 2020, up from 20 per cent of sales today.
Highlighting the importance of mobile in the overall device mix, the report said that 80 per cent of online research is on mobile phones today and this is expected to rise further with the increasing penetration of smartphones and mobile data connections.
The report reveals that the nature of the game is changing. Apart from the fight for the consumer, it also referred as the fight for relevance as new business models compete for attention. At present, more than 40 per cent of lead consumers report using app-based taxi services like Ola and Uber more than 3-4 times per week and hence, there is enough space for growth.