Billionaire Elon Musk has reached an agreement to buy Twitter for roughly $44 billion.
Tesla CEO Elon Musk’s Twitter acquisition is being closely monitored by the digital advertising agencies in India, for whom the microblogging site is a key platform to build brand awareness for advertisers. Players in the digital advertising space say that India holds strong potential for Twitter in terms of digital marketing.
Siddhartha Singh, Director and co-founder of Black Cab noted that India is one of the fastest-growing markets for Twitter and that it is one of the key regions for growth for the social media platform over the next few years.
“It (Twitter) creates an opportunity for brands to converse with their potential customers. It is a great platform for advocacy and brand positioning. It has been used by brands like Zomato, Swiggy, and Fevicol to piggybank on conversations happening on the platform. Hence, it is a key part of a digital strategy of a brand and also because it has such a large user base within India,” he added.
Singh said the lion’s share of digital spending goes to social media platforms including Twitter, Instagram and YouTube.
Digital is expected to overtake TV to become the largest medium in 2022, according to a recent GroupM report. In 2021, digital with a share of 41 percent was a close second to TV which had a share of 42 percent in India’s overall ad spending. Digital’s share is expected to reach 45 percent in 2022. An EY-FICCI 2022 report points out that search and social media, across different platforms, provided 69 percent of digital ad revenues.
While Twitter has a small share of India’s digital ad revenues, Singh said that it is still a crucial part of any brand’s digital ad strategy.
“When it comes to sponsored and targeted advertising, Twitter is one of the most premium platforms. However, the clientele of Twitter is a lot different from other platforms. Trends mostly start on Twitter and then get amplified on Instagram or YouTube,” said Neha Puri, Founder & CEO, VavoDigital.
Amrita Dey, Group Creative Director, 4AM Worldwide, said that Twitter’s advanced search makes looking for brand-specific conversations quite easy. “In the advertising industry, we often ask for briefs in a tweet line or insights in one tweet line. Twitter in the marketing community stands for focused group talks.”
She added, “Considering 80 percent of Twitter’s audience is outside the US, India can and must play a larger role. It (Twitter) will however need to balance its ideology of free speech with the laws of the land.”
Currently, Twitter has a relatively low share in India’s digital presence, said Puri. “Twitter might roughly stand between 2.5 percent and 3.5 percent share.”
“There was an elitist portrayal of the engagement platform earlier which due to the pandemic was washed down with heavy localisation as pan-India people started connecting for on-ground help. Twitter really needs to leverage its strength well here,” said Dey.
Even Ambarish Ray, Co-founder and CEO, Digital Dogs Content and Media said that Twitter has not really built itself out in India. “Indians may use Twitter a lot. But Indian marketers don’t pay to be on Twitter. A brand can strike a deal to be on Twitter for an entire year for about Rs 8 lakh.”
Utkarsh Sinha, Managing Director, Bexley Advisors, a boutique investment bank firm noted that Twitter draws a minute fraction of its revenues from India. “While it does not report India revenues separately, in 2020, with global revenue of just over USD3.7 billion, India’s operating revenue was just around USD12 million. For comparison, Facebook had India revenues of over USD1.2bn in 2020-21. Twitter’s monetisation engine has always lagged behind its social network peers,” he said.
But Puri said that Twitter has raced to introduce products in new areas like audio-only chat rooms and newsletter publishing in an effort to turn around years of business stagnation and provide brands and consumers with a new opportunity to interact.
Despite accounting for 8-10 percent of the social media user base of India, Singh said that the platform is key for brands, especially consumer-led companies. Ray noted that as of January 2022, India ranks third after the US and Japan in terms of number of Twitter users at 23.6 million users.
“For brands in fintech, startup unicorns, banking, sports, news and OTT, Twitter is paramount,” said Dey.
VavoDigital’s Puri said the jewellery business is the most active on Twitter, with a twofold increase in average interaction rate over the past years. Facebook’s average engagement rate in 2021 was 0.13 percent, Twitter’s engagement rate was 0.05 percent, and Instagram had an average engagement rate of 0.83 percent, Puri said citing a report by SocialInsider, a social media analytics firm.
“Brands like Starbucks, PlayStation, Samsung, Sony, Michael Kors, McDonald’s, Calvin Klein, and Etsy have taken up to Twitter to propagate their campaigns,” added Puri.
In addition to brands, Singh said that Twitter is used by spokespersons of large corporates. “Take the example of Anand Mahindra. He is active on Twitter which helps in overall visibility of Mahindra Group,” he said.
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