NEW DELHI: India's marketers are opting for online video advertising as a more cost-effective and targeted communication channel than TV.

Recent figures from Comscore illustrate the trend, with the number of online video viewers increasing 37% in the past year. India now stands third behind Japan and China in the number of total unique viewers, this despite limitations in bandwidth and penetration.

In terms of actual numbers, in June 2012 there were 3.4bn monthly video views online, a 79% increase in 12 months.

Over the same period there was a 23% increase in the amount of time spent on consuming video content, to 459 minutes per viewer.

Vineet Gupta, managing partner of 22feet, a digital agency, told The Economic Times there has been a significant shift in spend to video, adding "It's no longer just being siphoned from 'digital' budgets but from the cash reserves used for traditional TV commercials."

The limitations of the traditional TV ad format in the digital world are a factor. "With increasing number of people consuming video content in a social environment it has become critical for advertisers to tell their story by going beyond a typical 30 seconder," said Kartik Sharma, managing partner of Maxus, a media agency.

And leading brands are taking notice. Vinay Bhatia, SVP of Shoppers Stop, the country's largest fashion retail brand, claims to be getting better returns than TV and at a fraction of the cost using internet and video advertising through the brand's YouTube Channel.

And his views are echoed by L'Oreal. "We use video advertising extensively as we believe it is the medium of the future," said Satyaki Ghosh, director - consumer products division, L'Oreal India.

Peter England, the clothing retailer, considers this medium to be more relevant to a young audience, cost-effective and trackable. Consquently, it has spent approximately 35% of its digital media spend on video in the current year.

Another advantage of online video for Indian advertisers is the ease with which they can be dubbed into Gujarati or Hindi for non-English speakers.

Data sourced from The Economic Times; additional content by Warc staff