At ₹60,908 crore, growth in advertising expenditure (Adex) in 2018 was pegged at 14.6 per cent, up from the earlier prediction of 12.8 per cent and almost double the growth rate achieved in 2017. Madison Advertising’s analysis of the Indian advertising sector has forecast searing growth at 16.4 per cent for Adex in 2019 to enable it to reach ₹70,889 crore.

Advertising expenditure refers to the cost incurred in promoting a business, with the help of publications, or television, radio, the internet, or out-of-home media (billboards).

Adex growth

The Madison Advertising Report, released in Mumbai late last evening, showed that in absolute terms, Adex has grown from ₹53,138 crore to ₹60,908 crore, an addition of ₹7,769 crore, the highest addition in one year in the last decade.

Though television still continues to be the largest contributor to Adex with 38 per cent share, it is followed by the print medium at 32 per cent, and digital media at 19 per cent. The share of Outdoor, Radio and Cinema has remained steady at 6 per cent, 4 per cent and 1 per cent respectively, over the last three years.

Print resilience

The analysis showed that India probably is the only major market where print Adex is actually growing year on year. Print grew by 4.4 per cent during 2018, marginally lower than Madison’s earlier projection of 5 per cent. However, print continues to be second highest contributor after TV, with a share of 32 per cent. And this share of Adex is also the highest in the world.

“While we predict (overall) growth of 16.4 per cent on the back of growth in digital and TV, corporates in the print media should not be disappointed at our forecast of 5 per cent in 2019,” Sam Balsara, Chairman, Madison World told BusinessLine . “My advice to print barons is to re-imagine print for the real estate sector, because digital has begun to make strong inroads and is eating into their lunch.”

Balsara noted the resilience of the print medium is also brought out by the fact that India has over 2 lakh advertisers and the number is growing, compared to TV which has only 12,000 advertisers.

The report showed that nearly 75 per cent of print’s growth, of ₹820 crore, is accounted by just five categories, advertising by FMCG, education, auto, retail and e-commerce portals.

Digital share

Though most of the Adex growth last year came from digital, which grew by almost 26 per cent, TV increased its share from 37 per cent to 38 per cent and grew by 19 per cent.

The digital advertising market had an impressive growth of 26 per cent in 2018. It has been growing at a CAGR of 30 per cent plus for the last 10 years and 24 per cent for the last five years. Balsara said the past decade has seen the advertising industry more than tripling its expenditure, having moved up from ₹19,582 crore in 2009 to ₹60,908 crore in 2018, growing at a CAGR of 12 per cent.

“Growth came mainly from digital, which grew every year and clocked the highest growth rate of all media consistently,” he said.

The report showed continued growth of digital is fuelled by mobile, online video and social media, which are increasingly attracting more advertising investment.

OOT role

“One of the key reasons for this growth has been the proliferation of OTT platforms. The OTT playing field has seen a 3.5x increase in number of players from just nine players in 2016 to 30 players,” said Balsara. He added that digital Adex at ₹11,705 crore is now 19 per cent of Adex in 2018. It was only 9 per cent in 2013.

Google and Facebook continue to dominate digital spends cornering 80 per cent of the total digital pie.

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