Indian adspend set for further growth

16 February 2010

NEW DELHI: Advertising expenditure levels will increase by 13% in India this year after a challenging 2009, according to a new forecast.

The Pitch-Madison Media Advertising Outlook 2010 was compiled by Pitch, the industry title, and Madison Media, a communications agency with clients including Coca-Cola and Cadbury.

It predicted that ad revenues in the Asian nation would reach 21,145 crore rupees ($4.6bn; €3.4bn; £2.9bn) in 2010, having declined by ten percentage points, to 18,670 crore rupees, over the previous 12 months.

Sam Balsara, chairman of Madison World, said "if I look back, I cannot think of a year where the ad pie has shrunk the way it did in 2009."

"The fall is even more dramatic when we consider the fact that the industry grew by an average rate of 15% to 18% per cent over the five year period [from] 2004 to 2008."

Print media suffered the most heavily in 2009, with adspend contracting by 21% on an annual basis, to 7,806 crore rupees, but will see an expansion of 9% in the first year of the new decade.

Television posted a gain of 2% last year, with radio up by 3% in the same period, but these mediums will see gains of 15% and 20% respectively in 2010.

Online delivered double-digit growth over the last 12 months, from 363 crore rupees to 453 crore rupees, and will see sales climb to 680 crore rupees this year.

Outdoor's revenues, of 1,135 crore rupees, will improve by 15% this year, with cinema up by 5% from its comparative figure of 103 crore rupees, after both channels posted decreases in 2009.

Warc's most recent Consensus Forecast estimated that media budgets jumped by 5.7% in the rapidly-developing economy last year, with a further expansion of almost 10% likely this year.

GroupM, part of WPP Group, pegged this growth rate at 1% in 2009, excluding one-off expenditure linked to the general election, and 6% in 2010, taking the market to a total value of $5.2bn overall.

Data sourced from exchange4media; additional content by Warc staff