NEW DELHI: Indian brand owners are increasing their digital marketing budgets, raising spend on both advertising and earned media initiatives, a study has revealed.

Waggener Edstrom Worldwide, the communications agency, partnered with BlackBox Research, the insights provider, to survey 50 senior executives and 200 consumers in the country. They reported 94% of the companies represented now employ new media as a tool to engage their target audience.

This is a significant increase from the 87% who said the same a year ago.

The proportion of mainstream media marketing budgets dedicated to digital by the organisations assessed rose from 21% to 34% in the same period, demonstrating the rising importance of online touchpoints.

Within this, spending on activities going beyond pure advertising, such as building a presence on sites like Facebook, Twitter and YouTube, logged the greatest improvement.

A further 33% of planned outlay for 2011 will be allocated to broadcast media - namely, radio and TV - compared with 25% over the course of 2010 as a whole.

These gains have largely come at the expense of newspapers and magazines, which posted an annual contraction of 17%, thus taking 28% of expenditure.

Elsewhere, the analysis showed 70% of the participating brand owners were "enthusiastic" about utilising social media for PR and corporate communications purposes.

However, the study revealed 63% of consumers agreed real-time, negative online feedback had a "major impact", whereas just 46% of the professionals polled said the same.

Some 69% of firms thought the rise of social networks and similar platforms left them "more vulnerable" to popular criticism, but 60% felt adequately prepared to deal with this criticism.

"India is today one of the fastest growing markets globally, across industries. It presents both a challenge and opportunity, to constantly diversify, innovate and create new approaches in engaging as well as influencing audiences," Melissa Waggener Zorkin, CEO, Waggener Edstrom Worldwide, said.

"We strongly believe that this is one market that will continue to evolve."

Data sourced from Waggener Edstrom Worldwide; additional content by Warc staff