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MAS'17: Mobile adex to eclipse OOH + Radio by 2020

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MAS'17: Mobile adex to eclipse OOH + Radio by 2020

Mobile ad spends have been outstripping other mediums in terms of growth rate for the past 5 years. Assuming projected rates of growth and current estimates of ad spends on mobile, OOH and radio, we expect mobile ad spends to be more than OOH and radio ad spends combined by 2020, if not sooner. The findings are a part of exchange4media's annual Mobile Ad Spends report, which was released on Wednesday on the sidelines of Maddies'17.

We consulted media buyers, advertisers, mobile and digital agencies to understand how ad spends have grown in 2017. According to our research, mobile ad spends will grow at 74 per cent to reach around Rs 2,230 crore in 2017. Ad spends on mobile are expected to maintain a growth rate of in excess of 65 per cent into 2018 and we expect to see mobile advertising spends to reach around the Rs 4,000 crore mark by the end of 2018. 

The Pitch Madison Advertising Outlook for 2017 postulated an approximate 11 per cent growth rate for OOH and a 15 per cent (approx) growth rate for radio. At this growth rate, the OOH sector should see ad spends of Rs Rs 4423 crore by 2020 while radio sector will be worth Rs 3053 crore. On the other hand, assuming mobile ad spends to grow at a constant rate of 68 per cent over the next three years, the industry will be worth Rs 10,584 crore in 2020. 

Despite this, mobile is still expected to constitute a relatively small portion of the overall advertising pie in the immediate future with our estimate putting the mobile ad spends at near to 32 per cent of total digital ad spends in 2017. Considering digital is expected to be around 15 per cent of all ad spends in the country, this would mean mobile ad spends answer for  3.8 per cent of total ad spends currently. 

Though the growth picture is very rosy, there are still some hurdles along the way which the industry needs to address. Primary among these is the issue of attribution, which, despite efforts from industry leaders like Google, Facebook, etc., still needs a definite resolution.

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