In India's rapidly growing digital landscape, programmatic advertising is emerging as a pivotal strategy for app developers and marketers. It leverages automation and data-driven insights to optimize ad spending and reach the most relevant audiences. As smartphone penetration and internet usage continue to surge, programmatic advertising provides an efficient and scalable way to tap into this vast market.
Despite its many advantages, the share of programmatic advertising remains low among Indian marketers. According to the Dentsu e4m Digital Advertising Report, programmatic advertising accounted for 42% of the total digital ad spend in India, which translates to approximately $2 billion in 2023.
We’ve recently discussed why Indian marketers must embrace programmatic advertising. (You can read it here). In this blog, we delve into why the top five app verticals in India (by market size) should embrace programmatic advertising to drive growth and enhance user engagement.
Data sourced from Financial Express, Inc42, Business Wire, IBEF. Graph is adjusted to logarithmic scale
The Indian eCommerce market is projected to reach approximately over $100 billion by 2024 and is expected to grow at a CAGR of about 27% till end of this year. In 2023, the number of annual online shoppers was estimated to be about 250 million across India. With millions of consumers increasingly relying on online platforms for their shopping needs, programmatic advertising enables eCommerce apps to deliver highly personalized ads to potential buyers, based on their browsing history, purchase behavior, and demographic information. This personalization is crucial in converting casual browsers into loyal customers.
The mobile gaming industry in India is booming, with a diverse audience spanning various age groups and demographics. From RMG to role play games, from skill-based to casual gaming, the Indian gaming ecosystem has grown significantly. In 2022, Indian gamers reportedly spent an average of 8.5 hours per week on mobile gaming apps, which translates to about 1.2 hours per day. The mobile gaming market in India is projected to reach $6 billion by 2028, up from $3.1 billion in 2023, highlighting a robust growth trajectory.
As the gaming audience grows, programmatic advertising is an effective medium to reach the right players at the right time, enhancing user acquisition, transaction size of money-based games, and retention. Having the right ad strategy also helps to boost LTV for gaming apps, which is crucial in a fiercely competitive segment such as this.
The FinTech industry in India is booming with the rise of digital payments and online banking. This quick embrace of digital payments has allowed UPI to become the main catalyst behind the digital payments category, responsible for nearly 80% of the total digital payment volumes in India, with transactions reaching over 130 billion in FY 2023-2024. Besides these, there are also insurance apps that make it easy to buy and manage insurance policies further fueling the expansion of the financial services industry. The Indian InsurTech market is expected to grow at a CAGR of 46% from 2021 to 2026.
For FinTech apps looking to stand out in a crowded market, programmatic advertising offers the tools and capabilities needed to effectively reach and engage target audiences. The strategic use of programmatic advertising is crucial for FinTech apps to maintain relevance, drive user adoption, and achieve sustainable growth in an increasingly competitive and dynamic market.
Health and fitness apps continue to be among the top 5 fastest growing app verticals in India. With a crowded market space in the HealthTech sector that encompasses fitness apps, health trackers, physical and mental wellbeing, diagnostic apps, and pharma, it's more important than ever before for marketers to tap into the right users.
Food delivery and hyperlocal sectors in India have rapidly gained traction in India, catering to consumers' demands for fast delivery of food on-demand and everyday essentials. In the food delivery sector, mobile platforms are making a noticeable impact. Hyperlocal delivery models are thriving as they offer faster service and personalized experiences by focusing on specific geographical areas, going beyond Metro cities and connecting more consumers to local businesses and service.
From targeting the right audience segments to selecting impactful creatives, programmatic advertising offers the precision and scalability needed to thrive in today’s competitive app market. While challenges on navigating decisions around optimizing budgets, handling vast data sets, and the right creative optimization, may seem formidable, a well-chosen Demand Side Platform (DSP) can simplify these tasks. As mobile usage continues to rise and digital behaviors evolve, programmatic advertising offers the flexibility and intelligence required to adapt to changing market dynamics. Embracing programmatic advertising enables mobile app marketers to harness the power of technology, making their campaigns more efficient and impactful in driving growth and engagement.
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