Snapdeal Launches ‘Snapdeal Ads’ for Sellers; Attempts To Emulate Alibaba In Generating Ad Revenues
Indian ecommerce is now slowly but gradually entering the more matured phase of growth: the phase where the progress is not determined by the amount of discount offered and GMV churned out, but by generating actual profits from traditional sources.
Aiming on emulate Alibaba in generating advertisement based revenues, Snapdeal has launched their own in-house developed advertisement platform called Snapdeal Ads. Offered for their sellers, Snapdeal ads can significantly boost their bottom line, and help them to generate more revenues. Sellers would be able to buy ads starting from Rs 1000.
Chief product officer Anand Chandrasekaran said, “The advertising tools will help our over-two lakh strong seller community simplify their business journey and boost overall revenue as more users discover their products,”
As per sources, Snapdeal took 4 months to develop this advertisement platform, which is being headed by Asif Ali. He joined Snapdeal after they acquired Reduce Data in September. Specializing in artificial intelligence and real-time data of the user, Reduce Data was acquired to boost Snapdeal’s in-house ad platform.
How Will Snapdeal Ads Work?
Integrated into their seller’s accounts, Snapdeal Ads has been designed with simplicity, targeting those small businessmen, who have less experience with using tech.
A self-service panel is integrated, wherein any seller can buy ads, and show them infront of Snapdeal’s visitors. The advertisement platform includes analytics, a tool to create ads, and allow them to measure the impact by calculating ROI. These ads would be shown depending on location, interests and buying behavior of the user.
Snapdeal Ads’ deployment will be done in phases. Hence, in the 1st phase which was launched yesterday, sellers would be able to buy native advertisement formats for product commercials. Snapdeal’s website, mobile app and mobile site can be targeted for these ads, which would be triggered once a shopper visits a particular section of the website, and the ads would be shown in the regular listing with a text ‘Sponsored Ads’ in the bottom.
In the 2nd phase, sellers would be able to buy banner ads and other formats, targeted for particular keywords being searched on Snapdeal.com.
Snapdeal attracted 109 million visitors in the month of October, making them India’s 3rd largest ecommerce portal after Amazon and Flipkart. It is this 100 million+ traffic which Snapdeal is now aiming to monetize via their sellers.
Not a bad decision at all. Even Flipkart is aiming to start their own in-house advertisement platform as they have already acquired Adiquity Technologies to improve their in-house ads platform, and to make ads one of their core-revenue streams in coming days.
Emulating Alibaba: Wise Decision Or a Gamble?
Right now, Alibaba generates more than 50% of their revenues via their own in-house advertisements, which makes their ads total worth more than $1 billion every year.
Thus, when users type in ‘shoes’ or ‘stud jewelery’ in their search platform, sellers can bid for their keywords, and allow their listing to come up on the search results; just like Google’s Adwords platform.
Such is the massive reach of Alibaba’s search and ad platform, that in April, Alibaba actually overtook Baidu in terms of ad revenues from Mobile Internet. Baidu is China’s biggest search engine, often called Google of China.
However, efforts of Amazon and eBay to cash in the advertisement jackpot have failed in the past as hardcore ecommerce users (atleast those who are not in China!) are still relying on Google to arrive at the best products on these websites.
In India, Google is the #1 search platform for all categories, including eCommerce.
It would be really interesting to see how Snapdeal Ads evolve in India, for Indian sellers; and how much dent it can make in Google or Facebook’s advertisement revenues.