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Print adspend will grow in India

News, 16 March 2016

MUMBAI: India's overall advertising industry is expected to grow 10-12% in financial year 2017 (FY17), driven by budgets assigned to the auto, e-commerce and telecom sectors, and print media will perform strongly too.

According to India Ratings and Research (Ind-Ra), a Fitch Group company, digital media will retain its position as the fastest growing medium, with around 50% year-on-year growth.

Unlike many other markets around the world, print media is also expected to perform strongly. Ind-Ra said it expected Hindi and other vernacular print media to grow by around 10–12% in FY17, Television Post reported.

It is likely that vernacular print media will overshadow the English print media, which is expected to continue facing headwinds from the growing acceptance of digital media content.

In addition, Ind-Ra expects the Hindi and vernacular print media's circulation revenue to grow by 8–10% in FY17, driven by growing circulation as well as an increase in cover prices.

Meanwhile, print media companies' profitability margins are forecast to improve in FY17 as newsprint prices moderate due to a decrease in global demand.

E-commerce and auto will remain the primary contributors to the industry's ad revenue growth in FY17, Ind-Ra added, as it noted that the launch of 4G services will provide a further thrust.

However, the report went on to warn that multi-system operators (MSOs) are yet to realise the full benefits of cable TV digitisation in India because the industry is still challenged by issues over last mile connectivity.

Warc's latest International Ad Forecast, published in December, puts the preliminary estimate for Indian adspend growth in 2015 at +16.4%  with the combined spend on newspapers and TV accounting for three-quarters of the market's total value.

Digital formats are growing in prevalence however, with online ad expenditure rising in tow. Internet adspend is expected to top US$1bn in India this year.

The digital ambitions of India's marketers were clearly highlighted in Warc's recent study into mobile marketing, which found that while mobile currently accounts for less than 10% of most ad budgets, this share is expected to rise substantially over the next five years.

Data sourced from Television Post; additional content by Warc staff