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Will Indian short-video apps’ monetisation experiments pay off?

The apps don’t want to build their revenue model only around advertising.

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KOLKATA: The popularity of short snackable videos exploded in India with the advent of TikTok. While it was on the way to be the indisputable leader with top influencers, premium brands, and a growing number of users, geopolitical tension curtailed the dream journey. When several homegrown apps emerged to plug the market gap left by TikTok, many experts had been sceptical about their sustainability.

However, these apps did not tank – in fact, the ‘Made in India’ apps collectively have managed to capture TikTok’s market share. These platforms have secured 97 per cent of the Chinese app’s users, a recent report from consulting firm ReedSeer suggested. However, the time spent reaching 55 per cent of what it was in June shows there are more opportunities to boost engagement. While many of these apps are raising funds, using the capital to scale up the operations, build robust technology, adding new features, they have started looking at monetisation potentials as well.

Unleashing brand partnership opportunities

One of the apps that have emerged as a leading player in the ecosystem is MX TakaTak, the short video arm of MX Player. “For short video platforms, there are a variety of monetisation opportunities available. One is obviously the ad-based model, where we sell inventory to different brands. We are not focusing on that too much at the moment,” MX TakaTak business head Janhavi Parikh said.

For now, the platform’s primary focus is to work with brands to run branded hashtag challenges to drive engagement. “Although it’s in pretty early stages for us, a lot of brands are interested in doing this. But we are taking things slow. Branded challenges, influencer marketing are big opportunities to grow monetisation,” Parikh added.

Chingari has also tried out hashtag challenges for brands that are very popular on the platform, co-founder & CEO Sumit Ghosh said. Brands can float a hashtag and then offer money to influencers, creators to create content for the brand. It’s a win-win for the brands and creators as brands pay the latter and the platform amplifies the brand. However, the app is overall not very bullish about direct advertisements as those disrupt the user experience, he noted.

Another homegrown app Bolo Indya has partnered with brands to do content marketing using live streaming with creators where there could be a product positioning during the live stream or purely working with a brand for brand recall being the primary objective, Bolo Indya CEO and founder Varun Saxena shared.

Expanding the role of social commerce

Rather than depending only on advertisers, the apps are also coming up with innovative initiatives. Take for example Chingari – the app that’s dominating the vernacular markets is experimenting with several routes. “We will get into monetisation at a later stage but right now we are just testing certain methods,” Chingari’s Ghosh said.

 “We have recently produced video commerce technology where every video that gets uploaded to Chingari, you will see a shop button on the video, powered by AI & ML. Basically, what we are doing is finding out shoppable objects within the video and comparing with the live catalogue of Amazon and showing what products you can buy from Amazon,” he explained.

The chosen model will impact revenue as well. For Bolo Indya, it will not be a backend set-up but will be launched under a partnership model with an e-commerce player. MX TakaTak has also been toying with the idea. Lifestyle content focused short video platform Trell also entered this segment at the beginning of this year, partnering with over 500 brands across makeup, personal care, health and wellness categories.

Building consumer-creator direct engagement

“I think everybody is trying to innovate revenue model, somebody is trying e-commerce model, somebody is going the advertisement way. Everybody has to find which model suits their product and how to benefit. The good part for us is we have seen a good trend in terms of users spending on the platform, not just time but some money since last quarter,” Mitron TV CEO and co-founder Shivank Agarwal previously said in an interview.

The app, which recently celebrated its first anniversary, has opened up different monetisation opportunities. One such feature is Mitron Club, Through the Club, creators can churn out engaging content exclusively for users opting for the service. The Club members can also directly connect with creators to request to create content that they would like to watch. Consumers subscribe for Rs 99 per month to become a part of the entire ecosystem of the creator.

In addition to that, it has unveiled an on-demand service wherein consumers can ask specific help of creators and they can create videos around the queries asked by the audience.

Direct engagement between consumers and creators to drive monetisation is a key focus for Bolo Indya. On this app, content creators can create online services and post on the platform which are delivered on a real-time interactive basis to audiences through one-to-one, one-to-many live interactions, Bolo Indya’s Saxena said. This could be an astrologer conducting an astrology session with someone or a comic creator doing stand-up comedy show for a group of audiences on a pre-ticker basis. The app takes a platform fee and the rest of the share goes to creators.

“Our application primarily revolves around the core of enabling the content creators to monetise their content. When we native them to monetise their content on the platform, we see a revenue share out of it,” Saxena stated.

Another major mode of monetisation for the app is through live streaming. Any creator can go and live stream and people who are watching those live streams can send gifts to those creators. These gifts can be purchased by the audience paying real money on the platform, Saxena said. Whatever the value of the gifts end up being the earning of the content creators and the platform takes a revenue share out of it. Hence, the app highly relies on consumer microtransactions which start from as low as Rs 10 and goes up to Rs 5000.

Tapping into booming ed-tech opportunities

Interestingly, some of these platforms are looking at ed-tech as an opportunity to bring in money. Mitron Academy is one such initiative where the creators get an opportunity to share educational videos to help users learn from the platform. It has onboarded a number of experts on different topics.

Chingari is also working on an edtech offering called ‘Chingari Skill’ which will be launched soon. Thanks to this product, any Chingari user will be able to sell their skills. According to Ghosh, it will leave a lot of scopes for users to create such content in vernacular language as most ed-tech content is either in English or in Hindi. Notably, a large part of Chingari’s user base comes from tier-3 and tier-4 cities.

Future opportunities

“We have few other revenue streams in the pipeline which include launching creator rooms where the creator can post social games live learning sessions around fitness, wellness, health etc on the platform for a closed room of the audience creating their own customisation by the platform,” Saxena said.

While MX TakaTak is already doing live streaming, Parikh seems optimistic that there are a multitude of monetisation opportunities in live streaming over time. The bigger ones could be e-commerce as well as virtual gifting, all of which will be explored in near future.

How far is profitability?

As the platforms are trying to build sustainable revenue models, the question of when these models will turn profitable also arises. However, Chingari is not focusing on profitability at the moment and is devoting its energies to distribution, to reach the maximum numbers of users. Ghosh added that it may take two years down the line to become profitable.

However, Bolo Indya’s Saxena claimed the platform is very close to breaking even at the current scale as well when it comes to the monetisation side. He expects the app to be profitable in the next 12-15 months.

“If we look towards China, after the first few years, Kuaishou, as well as Douyin, have done phenomenally well because the growth has been so huge. With all of the different monetisation opportunities kicked in, it probably took three-four or even five-six years. If we follow that China model, revenue opportunity is huge and profitability follows definitely,” Parikh commented without revealing any timeline.

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