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GroupM revises industry growth estimates down to 8.5%; print to be hit hardest

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GroupM revises industry growth estimates down to 8.5%; print to be hit hardest

The slowdown in the economy, along with depreciation of the Rupee is beginning to impact the advertising industry. As per GroupM’s revised forecast of ad spends for H2, Adex has come down to 4.7 per cent from the earlier estimate of 7.3 per cent. The H2 slowdown brings down full year growth from 9.9 per cent to 8.5 per cent.

Categories growing
• Political parties and Government spending are expected to increase owing to the Lok Sabha Elections in 2014 and State Elections in 2013
• Auto will see growth buoyed by the several new launches lined up in the forthcoming months
• Media will continue to grow on new channel and programme launches

Categories slowing
• The FMCG sector is facing pressure on raw material prices and manufacturing processes
• In the telecom sector, handset manufacturers heavily dependent on imports of smartphones and feature phones are feeling the heat due to the devaluation of the Rupee
• In the BFSI sector, interest rates are not relenting and financial markets are under-performing

As per the revised estimates, print will see the lowest growth in ad spends in H2 at 0.7 per cent from the earlier 4.8 per cent. There is a downward revision in the spends for the rest of the media as well, including television, radio, OOH, and cinema. On the contrary, the ad spends for digital remain unchanged at 30 per cent.

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