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Ad spends in Auto, FMCG and Telecom to go up after India Inc. growth forecast

11-July-2018
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Ad spends in Auto, FMCG and Telecom to go up after India Inc. growth forecast

With India Inc. expected to report double-digit growth for third quarter in a row, this is expected to cast a positive spell on the Adex and marketing spends.
Some of the sectors which will be driving this growth include: auto companies, BFSI, FMCG, IT and Telecom.
Experts have already predicted a 10% growth in Adex in 2018. The total ad spending is expected to grow from Rs 61K crore in 2017 to Rs 69K crore in 2018. One of the biggest factors ushering this growth is the continuing urbanization and rising wages which are supporting consumer growth in finance, durables, services and retail. Moreover, India is witnessing an increase in spending from rural markets, as sales growth is at 1.5-2.5x of urban sales growth for major FMCG and consumer durable companies.
Speaking about the impact of the continued growth witnessed by India Inc. on Adex, Jyoti Kumar Bansal, CEO, PHD India, said, “India Inc reporting revenue growth should always spur confidence in the economy. That said, consumer confidence studies show mixed sentiments at best, with CCI showing a drop and MasterCard India index showing a growth. Advertising outlook should get a spur from a positive revenue growth outlook. But improved consumer sentiment will probably result in increased spends much faster. Advertisers are optimistic but everyone is watching the ad rupee and the return on it very closely.”
This year the growth rate for TV is expected to be 13 per cent, while Radio is expected to grow at 15 per cent while Print is expected to growth by over 4 per cent. The biggest growth will be witnessed by Digital, which is expected to witness 30 per cent growth this year.
Sharing her thoughts on the expected rise in Adex, Dr. Kirti Sharma, Faculty, Marketing, Management Development Institute, Gurgaon, said, “We are witnessing the highest growth by India Inc. in last three years in this quarter. This clearly indicates that there is increase in consumer spending. So, I strongly feel that this will have a positive impact on Adex. As FMCG companies would like to continue the growth story of rural demand, it would require increased spend in advertising too. There have been new product launches across the automobile sector which would require increased expenditure in advertising to increase awareness, trials and adoption. India as a country will be ensuing Lok Sabha elections in 2019, so this ecosystem will see increased spends in advertising by both Government and Industry to inform about success stories. This will help in creating awareness among people and consumers at large. Most FMCG companies have introduced new Ayurveda product lines, this will also ensure increase ad spends and hence the Adex growth in 2018.”

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