The country’s digital advertising market is projected to grow at a CAGR of 35 per cent to reach ₹7,044 crore by the end of this year, an IAMAI-IMRB report said on Wednesday.

The digital advertising market was pegged at ₹5,200 crore at the end of December 2015, accounting for about 12 per cent of the total advertisement spends in the country, the report titled ‘Digital Advertising in India’ said.

Steady growth

It has grown steadily from ₹1,140 crore in the 2010-11 fiscal to ₹2,260 crore in 2012-2013, and further to ₹5,200 crore in 2014-15, it added.

In terms of volume, e-commerce led the digital advertisement spends with ₹1,040 crore; followed by telecom (₹780 crore); Banking, Financial Services and Insurance (₹728 crore); and FMCG (₹676 crore), the report by Internet and Mobile Association of India (IAMAI) and IMRB International said.

In 2015, the education sector spent ₹312 crore, while travel and auto verticals spent ₹572 crore and ₹540 crore, respectively, on digital advertising.

However, the BFSI sector spent a higher share of its advertisement expenditure on digital compared to other verticals with 40 per cent of its overall advertising spends going towards digital. This was followed by e-commerce (26 per cent), telecom (25 per cent) and travel (25 per cent).

Video ads pick up

Companies spent about ₹1,488 crore on ‘search’, while close to ₹940 crore was spent on social media in 2015.

Expenditure on video ads such as on YouTube also showed huge gains in 2015, accounting for 17 per cent of the overall advertisement spends in the digital space, the report added.

This has been driven by higher Internet speeds available to the consumers, coupled with an increase in mobile advertisements.

“As these trends continue, video advertisement is expected to gain further in 2016,” the report added.

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