Report Description

The India advertising video on demand market is growing at a robust growth rate owing to increasing shift to online platforms, availability of diverse content, rise of digital video consumption, and increasing internet penetration. Furthermore, emphasis on monetization strategies, cost-effective advertising model, and integration of advanced ad technologies is significantly contributing to the India advertising video on demand market growth.

India Advertising Video on Demand Market Scope

AVOD platforms are advertising-based video platforms which integrate commercial advertisements across content that viewers may access without paying a subscription. The AVOD approach is popular among streaming services that want to generate money. Like SVOD and TVOD, Advertising Video on Demand (AVOD) is a sort of VOD streaming technology used to monetize online video content. Free, ad-supported streaming services like Hulu and YouTube mostly use advertisement video on demand services.

The rapid digital transformation in India has led to a surge in online video consumption. As more people have access the internet, AVOD platforms can reach a vast audience. Advertisers in India are increasingly recognizing the potential of AVOD platforms to reach their target audience effectively. As a result, there has been a growing demand for advertising inventory on these platforms. Thus, AVOD platforms provide a cost-effective advertising model for brands, allowing them to reach a targeted audience at a fraction of the cost of traditional media. Advertisers can also measure the effectiveness of their campaigns through analytics and user data.

India Advertising Video on Demand Market Overview

The AVOD market in India had been experiencing rapid growth, driven by factors such as increasing internet penetration, affordability of data plans, and the rising popularity of online video consumption. The market was projected to continue expanding as more users embraced digital platforms for entertainment. The growing preference for AVOD platforms among Indian consumers is being influenced by availability of free content. The cost-sensitive nature of the Indian market made AVOD platforms an attractive choice for users who wanted access to a wide range of video content without paying subscription fees, hence AVOD revenues expanded more quicker in India than in developed markets. The OTT market currently makes about 7-9% of the entire media and entertainment market, and this percentage is expected to grow in forecasted period.

The AVOD platforms adopted various monetization strategies to generate revenue. In addition to traditional display ads, platforms explored other forms of advertising such as pre-roll, mid-roll, and post-roll video ads. Some platforms also incorporated sponsored content and branded integrations to create additional revenue streams.

India Advertising Video on Demand Market Drivers

The advertising video on demand (AVOD) market in India is influenced by several key drivers that contribute to its growth and potential. India has witnessed a significant increase in internet penetration, driven by the availability of affordable smartphones and data plans. As more people gain access to the internet, the potential audience for AVOD platforms expands, leading to increased advertising opportunities. According to Ministry of Information and Broadcasting, India has over 600 million smart phones and 1.2 billion mobile phone users in 2022. The demand for OTT media services in the nation has been significantly impacted by the trend of consumers updating their TVs so they can access OTT (over-the-top) material on a larger screen.

There has been a notable shift in consumer behavior towards digital video consumption in India. Online video platforms, including AVOD platforms, have gained popularity among users who seek on-demand content. This trend has created a favorable environment for advertisers to reach a captive audience. Thus, the increasing internet penetration and rising video consumption might drive the India advertising video on demand market.

India Advertising Video on Demand Market Trends

The advertising video on demand platforms in India were increasingly investing in original content production to differentiate themselves and attract a larger audience. Original series, movies, and short-form content were being created exclusively for AVOD platforms, offering unique and engaging content to users. The advertisers in India are increasingly recognizing the potential of AVOD platforms to reach their target audience effectively. As a result, there is a growing demand for advertising inventory on these platforms. For instance, 'MX Gold' was launched in 2022 by MX Player, one of the biggest OTT platforms using the AVoD (advertising video on demand) model. This enables subscribers of platform to experience the content without advertisements and other perks like downloads and more. Advertisers are exploring AVOD platforms as an alternative or complementary channel to traditional media, given the shifting consumer behavior towards digital video consumption. Thus, production of original content and integration of interactive ads will fuel the market in forecasted period.

India Advertising Video on Demand Market Challenges

The advertising video on demand (AVOD) market in India faces several challenges that impact its growth and development. Excessive advertising can lead to an overload and adversely impact the user experience on AVOD platforms. The users may become less interested or even quit the platform entirely if they feel overrun by obtrusive or disruptive advertisements. Striking the right balance between ad frequency, ad format, and user experience is a challenge for AVOD platforms. Furthermore, compliance with evolving regulations, such as data privacy laws, consumer protection regulations, and advertising guidelines, poses a challenge for AVOD platforms. Adhering to these regulations while delivering effective advertising experiences requires ongoing monitoring and compliance efforts.

Recent Developments

  • In 2022, India's OTT platform, ALTBalaji introduced a Advertising-Based Video on Demand (AVOD) model, which has established a new standard in the Indian entertainment industry by offering a roster of innovative content.
  • The streaming rights for the men’s IPL were purchased by Viacom18, a joint venture between Network 18 (owned by Reliance Industries Limited) and Paramount Global, for an astounding amount of USD 3 billion in June 2022.

Market Opportunities

The advertising video on demand (AVOD) market in India presents several opportunities due to the country's large population. India is a diverse country with numerous regional languages. There is a growing demand for content in regional languages, including movies, TV shows, and web series. The AVOD platforms that cater to these regional preferences have a distinct advantage, as they can tap into the vast regional audience and offer targeted advertising opportunities. The AVOD platforms in India are increasingly incorporating advanced ad technologies like programmatic advertising, dynamic ad insertion, and interactive ad formats. These technologies enable real-time bidding, automated ad placement, and personalized ad experiences. Thus, advertisers can leverage these advancements to create engaging and interactive ad campaigns, enhancing their brand visibility and driving better results.

Furthermore, AVOD platforms can explore partnerships and collaborations with content creators, production houses, and influencers to create exclusive and original content. Such collaborations can help platforms differentiate themselves, attract more viewers, and offer unique advertising opportunities to brands. By aligning with popular content creators and influencers, AVOD platforms can tap into their fan base and create targeted advertising campaigns. Overall, the Indian AVOD market presents significant opportunities for advertisers to reach a large and diverse audience through targeted and cost-effective advertising solutions. By capitalizing on the country's digital growth and evolving consumer preferences, AVOD platforms and advertisers can forge successful partnerships and unlock the potential of AVOD market.