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Delhi-NCR redefines the advertising industry

Delhi-NCR redefines the advertising industry

Author | Ruhail Amin & Venkata Susmita Biswas | Wednesday, Apr 12,2017 8:05 AM

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Delhi-NCR redefines the advertising industry

Mumbai has remained the advertising capital of the country for long. Given its status of being the economic hub and the city that has a huge pool of creative talent, the advertising industry has been synonymous with the city. However, all this is about to change or rather fast changing.

As per a study conducted by Oxford Economics, Delhi overtook Mumbai in 2015, with a GDP of USD 370 billion compared with Mumbai's USD 368 billion, and the study predicts that Delhi will have a GDP of USD 1,040 billion and Mumbai USD 930 billion by 2030.

Given this shift in economics, Delhi-NCR is fast emerging as the new hub of the advertising world. One of the reasons for this shift is that big ad spenders like Maruti, Pepsi, Coke, Nestle, etc., are based in Delhi-NCR, and consequently the ad industry has grown too.

Speaking about the emergence of this new ad capital in the Delhi-NCR region, Tarun Rai, CEO, JWT South Asia, said, “New Delhi, actually NCR, is becoming a big ad market for the past decade or so. Many of the country's high-profile brands are now based there. And therefore, the ad industry has grown too. But Mumbai continues to be important. Many marquee companies and brands continue to be in Mumbai. Besides, thanks to Bollywood, a lot of the production facilities and talent continues to be in Mumbai. I would say we have two advertising capitals now.”

In addition, the proximity to the national capital has also made companies like telecom majors and mobile handset manufacturers set up or move their headquarters to the NCR. “Once large FMCG clients came up in Delhi-NCR, it meant that there would be a need and demand for advertising there, and therefore advertising agencies started going there,” said Ashish Bhasin, Chairman & CEO, South Asia Dentsu Aegis Network.

Rajiv Dingra, Founder and CEO, WATConsult, believes that the signs of this shift have been in the making for a while now. According to him, “This has been in the works for some time now. Over last 2–3 years, Delhi has risen as one of the largest advertising spenders and this has been driven across categories. We see this trend only growing, with many large Chinese handset players along with Telecom and FMCG players from Delhi growing their spends over the next 2–3 years.”

Sandeep Amar, CEO, Indian Express Digital, explains this change saying, “This shift happened a long time ago and other than the exception of Unilever and BFSI, Delhi is a very strong market with Coca-Cola, Pepsi and other big brands like Samsung and LG operating from here. I think NCR hubs like Noida and Gurugram have given good office options to some of these corporates. On the agency side, GroupM still has a huge presence in Mumbai, but I believe that Delhi is already a bigger market in advertising.”

Manish Bhatt, Founder Director, Scarecrow Communications, stated that the Delhi-NCR region emerged as a marketing hub overtaking Mumbai a long while ago. “In the early days, when we saw the rise of big corporates like ITC, Birla, and other such conglomerates, Kolkata was in fact the hub of marketing. That shifted to Mumbai as the city grew to be the financial capital of the nation. For about 10–15 years now, Delhi has been the marketing hub because many companies that spend significantly on advertising have set up bases in Delhi-NCR,” said Bhatt.

The rise of Gurugram as a favoured city for setting up manufacturing plants has driven the marketing hub to Delhi-NCR from Mumbai. Sujata Dwibedy, EVP, Carat, explained that Delhi-NCR became the preferred region for companies because infrastructure there is much more supportive to companies, for one, land is much cheaper.

Dwibedy added that although Delhi’s growth has been fast-paced, it will not overtake Mumbai because Mumbai is where the largest advertisers are based. She also said that marketing activities may spread to more cities beyond the four metros in the future and more markets will get into advertising.

Mumbai has no reason to worry though. While Delhi-NCR’s growth as a marketing hub has been fast and unexpected, Mumbai will continue to be a prominent centre for the marketing and advertising industry given its proximity to creative talent in Bollywood. “Mumbai will always have an edge because the Bollywood industry is based here. In addition, huge advertisers like Hindustan Lever, Procter&Gamble, L’Oreal, and Johnson & Johnson are still based in Mumbai,” Bhasin pointed out. He also added that Mumbai is a key marketing and advertising hub because head offices of several agencies are based in Mumbai, as are industry bodies.

“Delhi has grown much faster than Mumbai but Mumbai will continue to hold its place in the industry. Just because Delhi-NCR has come up does not mean Mumbai has gone down. The whole universe has grown and the growth will continue,” added Bhasin.

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