At present, only 1% of the overall digital advertising spends accrue to short video apps, according to the report.
However, short video apps can capture 10-20% of the overall digital advertising pie, amounting to almost $6 billion, by 2030, the consulting firm has estimated.
Following the exit of
Chinese short video giant TikTok in 2020, Indian short video apps have scaled up to 300 million active users cumulatively at present, the report said.
This growth has come because Indians continue to be heavy users of mobile entertainment and spend close to 156 minutes per day viewing entertainment content on their smartphones, according to the report.
RedSeer has forecast that these platforms would double their monthly active user base to 600 million by 2025 and 850-900 million users by 2030.
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“Indian short form apps are witnessing strong growth as compared to other established platforms, this can be attributed to their low decision fatigue, language localization, recommendations, genre variety and local creator influence. In fact, on average, an Indian user consumes close to 38 minutes of short form content each day,” said Mohit Rana, partner at RedSeer.
Currently, almost 59% of India’s short video users are from rural and semi-urban towns, with VerSe Innovation’s Josh and ShareChat’s Moj making significant inroads.
Fight for monetisation
At present, advertising, video-commerce and gifting are the three major monetisation streams for short video apps.
Over the past several months, players such as Josh and Moj have aggressively started focusing on monetisation.
In April, VerSe Innovation, the parent entity of news aggregator platform Dailyhunt and Josh said
that it had signed definitive documents and raised $805 million in a funding round led by existing investor Canada Pension Plan Investment Board (CPPIB), taking its valuation to $5 billion.
At that time, the company said Josh had about 150 million monthly active users with 49% of them being daily active users.
VerSe cofounder Umang Bedi had told ET that the company will focus on monetisation of short videos.
“This includes shoppable commerce experience, influencer commerce, live commerce and extending to influencers a brand new Web3.0 platform experience which will help them monetise from audiences, not just here but we would be glad to take it global,” he had said during the fundraise.
VerSe declined to comment on ET’s queries.
Regional language social media platform ShareChat has also focused on consolidating its market position, and entered into an agreement to merge its short-video offering Moj with MX Media-owned MX TakaTak in February.
MX Media is owned by Times Internet, the digital arm of the Times of India Group that also publishes The Economic Times.
Last month, ShareChat’s parent Mohalla Tech raised $255 million (Rs 1,990 crore) in a fresh funding round from online search giant Google and the Times Group, at a valuation of $5 billion.
Apart from advertising, ShareChat said it had been building diversified monetisation teams such as virtual gifting and video commerce.
ShareChat told ET on Friday that it was currently clocking over $60 million in annual revenue run rate from customer-to-customer (C2C) micro transactions on its platform.
“Now, we are porting these engines on Moj which is witnessing an even steeper growth curve. We expect this to grow by 25-30% on an average month on month. Live commerce is another domain where we want to focus on,” said Manohar Singh Charan, chief financial officer, ShareChat and Moj.
“In recent months, Moj has also become a key social/live commerce platform in the country through its partnership with Flipkart. With increasing user adoption, we expect video live streaming and virtual gifting to become mainstream very soon,” Charan added.
In China, a key market for short video apps, advertisements continue to be one of the primary monetization approaches with an increasing focus on livestream ecommerce, RedSeer said in the report.
