China’s Madhouse to start India services

Madhouse aims to use mobile as a mass media advertising device considering there are more than 850 million connections in the country. Mobile advertising in India faces barriers such as the need to harmonize different operating systems across multiple stakeholders and the lack of established tools and systems.

Vinod Thadani, chief operating officer of Madhouse India, says unlocking the potential of the Indian digital media landscape will see the mobile media market grow to ₹ 1,000 crore from ₹ 125 crore in the next three years. While Madhouse India will launch with the WPP partnership, this was not mutually exclusive, he said. Madhouse can partner with other agency groups in the future (for mobile solutions), he said.

Joshua Maa, founder of Madhouse, said, “we see tremendous growth and potential in India and are fully committed to investing in this market. With the right local partners, we believe that our technology and operational expertise can be leveraged to serve the unique mobile marketing needs of clients. In China, we have been working with partners such as Rovio Entertainment Ltd, Electronic Arts Inc., China Unicom Hong Kong Ltd’s app store, and ad agencies to grow our leadership position. Similarly, in India, we value our association with WPP to help develop and take leadership in this market as well."

Ranjan Kapur, country manager of WPP, said that population-wise, India and China almost had the same statistics. But the advertising growth story was completely different.

“While China is a $55 billion advertising market, India is a $6 billion advertising market. The fact is that we are an underadvertised market." That’s because manufacturing needs to catch up with services and contribute to a much larger share of advertising.

Others such as Rovio Entertainment (creator of the game Angry Birds) also hope to ride on the Madhouse entry into India. “Madhouse is a valuable partner for us in China, and we are excited about the opportunity to extend our collaboration to India as well," said Bijay Gurung, key account director, Rovio Entertainment. They will explore opportunities both in game development and merchandising in India, he said.

A 2011 entertainment and media report by the Federation of Indian Chambers of Commerce and Industry in association with KPMG Advisory Services Pvt. Ltd states that India is the second largest mobile Internet market in the world.

The report adds that mobile is expected to be the No. 1 screen through which consumers can engage with advertisers and brands. Yet mobile advertising represents only around $2.7 billion of the global $500 billion advertising market.

Abdul Khan, senior vice-president at Tata Teleservices Ltd, said that most mobile advertising in the country was rudimentary in nature. “This Chinese firm will have to offer scale, size, consistency, creativity, reach— all in the same breath in order to significantly make a difference," he said. “At the moment, mobile advertising has few evangelists in the country. It has not realized its true potential in revenue and there is complete lack of creativity in mobile ads."

The main criticism of mobile advertising is with regard to revenue realization.

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