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Digital to boost India adspend

News, 04 February 2015

NEW DELHI: In 2015, advertising expenditure in India is forecast to grow at the same rate as last year, with the high-spending FMCG sector putting more money into digital.

The latest This Year Next Year report from media agency Group M expects adspend in 2015 to increase 12.6%, compared to 12.5% in 2014, to reach a total of Rs. 48,977 crore.

"With a new Government coming to power, the negative sentiment has lifted, but there is still some bit of caution amongst advertisers," according to C V L Srinivas, GroupM's Chief Executive for South Asia. "We continue to operate in the same zone as last year at an overall level," he added.

Digital is growing around three times as fast as the overall market, however, at 37%, and its share of total adspend is set to increase from 7.8% to 9.5%.

Television continues to be the major spending medium, predicted to rise 16% to Rs. 22,446 crore and edge its share upwards from 44.5% to 45.8%, helped by events such as the ICC Cricket World Cup.

Print is one of the biggest losers, with growth expected to be less than half that of the overall market, at 5%. While still the second largest advertising medium by a long way, valued at Rs. 16,872 crore, its share is projected to slide from 37.0% to 34.4%.

Out-of-home will also grow only slowly, at 4% to Rs 2,582 crore, while radio is steady on 11% growth to Rs. 2,007 crore.

Cinema is the smallest channel but its anticipated growth of 20% to a value of Rs. 408 crore, driven by consolidation in the multiplex business and the digitisation of single screens, was described by Srivinas in the Business Standard as "an eye-opener".

In terms of the categories that are driving adspend, ecommerce is expected to "lead the charge" in 2015, the Economic Times reported. "There is increased competition in this sector and no dearth of funding," said Group M.


The report also highlighted the FMCG, auto and telecoms as categories that would do better in 2015, while the entry of foreign retailers operating in the single brand format is likely to boost retailing advertising expenditure.

Data sourced from Afaqs!, Business Standard, Economic Times; additional content by Warc staff