Top Story

e4m_logo.png

Home >> Advertising >> Article

India may become a Rs. 1 trillion advertising market by 2022

11-December-2017
Font Size   16
India may become a Rs. 1 trillion advertising market by 2022

India reeled through the lingering impact of demonetization in November, 2016 and GST in July 2017. Transitory costs for introducing bold structural reforms have been paid and there seems to be an upswing in economic activity. The bank recapitalization plan coupled with insolvency and bankruptcy code 2016, are trying to revive the sector and this will boost private investment. Revival in rural economy and growing middle class will boost economic growth. GDP in real terms is expected to grow +6.7 per cent, a speck slower than earlier projected +7.17 per cent. In 2018, IMF report predicts growth of +7.4 per cent.


The report states that the advertising revenue will grow at CAGR of +12.1 per cent in the next five years to touch Rs. 1.07 trillion. Interestingly, it says that the growth will be led by digital with +21.6 per cent. Television will still rule the top as the largest media in 2022 with a market share of 41 per cent. Digital and Print will have equal share of 25 per cent. The report also states that mobile will displace desktop as the third largest category by 2020.


According to the report, United States and China contribute close to 50 per cent of the incremental ad dollars between 2018 and 2022 while India ranks third, with a 6 per cent contribution. It says that the traditional categories like Print are strong and growing YOY in India and that over 60 per cent of this incremental dollars is coming from traditional categories.

The 2017 reported had estimated Adex growth rate of +11.5 per cent earlier in June and has been revised marginally downwards to +11.1 per cent. In 2018, IPG Mediabrands expect the Ad spends to grow +12.1 per cent. The categories they believe will drive up spends next year will be Auto, FMCG, Banking, Consumer durables and E-commerce.

The Auto industry may see a demand for commercial vehicles due to heightened infrastructure activity and government’s focus on electric vehicles to meet emission targets that may become some of the growth drivers.

FMCG penetration will increase, with modern trade growing faster in Tier-II and Tier-III cities. Raising disposable income among rural consumers, E-commerce providing strong offers with daily products, evolving consumer lifestyle and government FDI policy is leading to the growth.

IMG believes that the need for banking will rise thanks to increase in working population. Housing and Personal finance will become key drivers. Government’s financial inclusion plan is expanding the reach of banking services and insurance coverage to rural segment.
It also says that the demand for consumer durables will grow with rural electrification and e-commerce expansion.

The E-commerce industry’s growth is predicted to be propelled by increasing smartphone penetration and digital literacy, combined with affordable data costs. GST will help E-commerce players to streamline supply chain and eliminate dual taxes. The sector is attracting more users from Tier II and Tier III cities.

Tags advertising growth Interpublic IPG Mediabrands AdEx Analysis CAGR

Vijay Mansukhani, speaks to exchange4media about the resurgence of Onida, the scope of growth of consumer electronics market in India and the reasons why Indian consumer electronics brands don’t compete on a global scale

Projjol Banerjea opens up about hiring Anne Macdonald and GroupM's Rob Norman, and the brand's new identity

Meera Iyer tells exchange4media that in FY 2016/17, bigbasket clocked a revenue of Rs 1,400 crore. The online supermarket currently stands at 70,000 orders a day, with operations in 25 cities.

CMO, Kashyap Vadapalli on the start-up’s marketing play, why it has decided to stay away from IPL and response to its furniture rental apps

The campaign, featuring brand ambassador Farhan Akhtar, exhorts consumers to showcase their achievements through the walls of their homes.

We list a few important stories that you may have missed in the week gone by

The campaign takes the narrative forward to persuade prospective investors to invest in mutual funds