Recently a major telecom service provider in India announced the launch of its 4G services in many of the country's metropolitan cities. Another telecom service provider has already been offering 4G services in the country since the past several months. On the other hand, India surpassed the United States to become the second biggest smartphone market in the world, with China holding the top position.
All this is the result of the fact that when it comes to Internet access, Indian consumers today turn to their smartphones first. As they rapidly become comfortable with the medium, their need for quality connectivity and an enriching user experience are going up, compelling the ecosystem to align its products and services with the changing demand.
In fact, according to a recent Cisco VNI estimate, mobile data traffic via smartphones is set to grow over 14-fold between 2015 and 2020, at a strong CAGR of 70%. Smartphones will account for 85% of the country's total data traffic by 2020, a number that was estimated to be at 69% in 2015.
The connectivity ecosystem is also responding to this change, and it is also estimated that mobile connection speeds will grow over three-fold (at a 25% CAGR) from 2015 to 2020, reaching 3,122 kbps in 2020 from the 1,016 kbps connection speed in 2015.
Video a major growth driver
This massive increase in data consumption is a result of the fact that Indian smartphone consumers are doing a lot more with their devices than before. While social networking may be one of the favorites, a wide variety of apps are picking up steam today. Mobile gaming continues to garner widespread popularity. Apps that let consumers book a cab, order food or make a table reservation at restaurants, apps that give local information such as local transport timings and routes, news and other information are finding rapid uptake. Even audio streaming apps are finding growing adoption.
All this means smartphones are consuming a lot more data than even before. The study also estimates that in India, a smartphone on an average generates 9 times more mobile data traffic than a basic handset. In fact by 2020, an average smartphone will generate over 2 GB of mobile data traffic per month, up from 430 megabytes per month in 2015, a CAGR of 37%.
However, what will truly drive this rapid growth is video content. While traditional video streaming apps continue to finding increasing uptake, there has been a growing trend of Indian television companies extending their content on smartphones through video on demand apps. The fact that today, a highly enriching video experience can be provided by smartphones that come at a cost-effective price points, means more people are opening up to the idea of accessing online video content on smartphones.
What this means for the mobile marketing ecosystem
For both marketers and app publishers, this means there is a growing opportunity to the more immersive video ad format to engage their audience. There is also an opportunity to make the most of their monetization strategies by integrating video ads into video content. Native video is said to deliver up to 6 times more Click-Through Rate (CTR) than other ad formats. Video ads for app installs give users a richer demonstration of the gameplay or app experience than what they get with non-video formats.
Therefore, whether you're a marketer or an app publisher, it's time to think video if you're looking to engage Indian smartphone users whose appetite for the content is rapidly growing.