The Indian advertising industry is set for heady days, though at a tad slower pace than the previous year. The industry that grew a whopping 16.4 per cent in 2014, is expected to slow down this year and grow by 9.6 per cent.
The Pitch Madison Advertising Outlook report has said that by the end of 2015, the total advertising market in India would be ₹40,658 crore. It also said that over the past two years, the advertising market would have grown by around 27.5 per cent.
Sam Balsara, Chairman, Madison Communications said the Indian advertising industry is “almost at par with our forecast of 16.8 per cent. In terms of absolute numbers, the advertising industry increased by ₹5,200 crore and touched ₹37,100 crore in 2014.”
Interestingly, while India’s ad spend is expected to grow by nearly 10 per cent, global adspend is expected to increase by just 4.8 per cent in 2015, according to Warc's International Ad Forecast. Except for India and the UK, the forecast for most countries has been downgraded by Warc. It has predicted that the biggest increases in adspend in 2015 would come from India at 15.1 per cent, and China at 10.5 per cent.
Several other advertising and marketing majors have also pointed out to the growth story playing out in the Indian ad market. Zenithoptimedia has forecast that global adspend is expected to grow by 5 per cent this year, and 6 per cent in 2016. Advertising spend in India on the other hand, is expected to grow by 12 per cent, according to Zenithoptimedia.
New targetsSam Balsara noted that while 2015 is promising, uncertainty in the area of media deliveries is a very likely. He added that part of the heady growth of last year could be attributed to the General elections and five State elections, as well as the high ad spend by electronic commerce players.
“There were two main categories that fuelled the overall growth in 2014. While elections contributed as much as ₹2,300 crore, emerging e-commerce players too advertised heavily contributing as much as ₹1,150 crore,” he told the audience at the release of the Pitch Madison Advertising Outlook report.
Almost half the growth in 2014 came from elections alone, he said, with the two categories together accounting for 2/3rd of the growth.
Of the 16.4 per cent growth rate registered in 2014, nearly 7.2 per cent was on account of elections alone, while 3.6 per cent was on account of e-commerce. Existing categories contributed to only 5.6 per cent of the overall growth.
Balsara added that whilst the growth in 2014 was “fantastic, mainly because of election spends, we are equally bullish for 2015 too, but our forecast has to recognise that 2015 is not an election year.”
A stable government at the Centre “that is focusing on the growth of the Indian economy, positive market sentiment, upbeat consumer confidence and India once again attracting global attention,” were the many reasons why the agency decided to double its growth forecast to 9.6 per cent from the earlier years, as compared to the like-to-like growth of 5.6 per cent.
Government spendReleasing the Outlook report in Mumbai, Piyush Goyal, Minister of State for Power, Coal and New and Renewable Energy, maintained that his government believed in the importance of communication.
“It plays a critical role in the success of the Government’s various innovative schemes. We are committed to improving the standard of living and the quality of life of Indians. Communication through traditional and social media helps us in our outreach programmes for greater peoples’ participation,” he told the gathering.