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By 2025, 67 per cent or nearly 2 in every 3 Indians may have a short-video application on their mobile phones. The short-form video market can provide the country with a monetisation opportunity worth $19 billion by 2030, according to a report released by management consulting firm RedSeer in July.
The report further stated that India currently has 300 million people using short video apps like Tiki, Moj, and ShareChat. It can rise to 600 million by 2025.
“The pandemic has triggered a pivot in consumer preference to short-form video (SFV) content, as consumers’ attention spans have become shorter. This has led to the popularity of SFVs, and in my view, this growing trend is expected to continue,” Raja Lahiri, partner and TMT leader at Grant Thornton Bharat, said.
The short video apps have also enabled social commerce. “Social commerce and virtual gifting are some of the monetisation models emerging as new opportunities for short video platforms today,” Ian Goh, CEO of short video platform Tiki, said.
Unlike the urban audience of long-form video apps like Netflix and Amazon Prime, these apps have a high percentage of users from rural areas of the country, the report added. Thirty-five per cent of the total users of these apps come from rural India. On the other hand, 30 per cent belong to non-metro urban areas, and 19 per cent are from metro cities.
“Tier 2 and 4 city users are not just seeking content to consume, but also a community to connect. Amazon & Netflix can’t satisfy users’ socialising and communication needs, while SFV platforms do so with live streaming and more,” Goh said.
Some experts believe that the pricing of the content also plays a significant role in India.
“OTTs are mostly content production companies who want to sell premium content at a price to the consumer, which by default will have low adoption and both are currently not supported by the ad models,” Ajit Varghese, CCO of video platforms ShareChat & Moj said.
The report stated that 1 per cent of digital advertising is currently spent on short video platforms. This may rise to 10-20 per cent by 2030.
“This has changed the way advertisers are looking to engage with their customers. However, quality and niche content will continue to draw attention and higher return on investment,” Lahiri said.
Out of $19 billion, advertising alone may account for about $6 billion in monetisation potential by 2030, according to RedSeer.
“Short form video content apps may garner the interest of advertisers for raising awareness on new product/service and offers, especially for those brands that wish to cater to the Tier-II and tier-III audiences,” Lahiri stated.
However, he cautioned that despite the high usage in Tier II and III cities, Tier I cities may continue to drive the ROI metrics of the companies.
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