Advertising expenditure is headed for exciting times this year and is expected to shoot past Rs 40,000 crore in 2014.

Election spending by the Government and political parties is set to significantly add to the ad expenditure across all media, with print emerging a frontrunner.

CVL Srinivas, CEO of GroupM South Asia, said, "There has been a lot of buoyancy with the growth in language newspapers. We see that growth increasing over the coming years. There is a lot more happening in the regional market, and in smaller towns, and the vernacular print media could benefit as a consequence".

Speaking to Business Line , Srinivas said, "Advertisers are investing in regional press, and it has been growing over the last 2-3 years. Advertisers are keen on the medium, and getting good returns. The growth this year would be largely driven by language newspapers".

Print vs TV Advertising: Report

According to a report by GroupM, a global media research company, advertising across newspapers is set to double this year to Rs 16,238 crore as compared to television, which would touch Rs 18,883 crore in 2014. From charting an overall 10 per cent growth in 2013, advertising expenditure (AdEx) is set to climb to 11.6 per cent this year.

The year on year percentage change in the print medium is expected to show a significant jump by 8.5 per cent as against the 2013 estimate of 4.6 per cent. As per GroupM’s research of the Indian media industry, digital media is expected to record maximum growth at 35 per cent, followed by 12 per cent in TV, which is a drop from the 13.6 per cent recorded in 2013.

Net media spends on newspapers is estimated to shoot up to Rs 15,459.4 crore in 2014, as compared to Rs 14,248.3 crore clocked last year, while that of television is expected to jump from Rs 16,860.2 crore of 2013, to Rs 18,883.4 crore this year.

Incidentally, all the numbers quoted in the report are net advertising revenues not inclusive of agency commissions. Hence, they reflect what media owners have earned and not what advertisers have spent.

"Given that this is an election year, we would see increased ad spends. Though backed by uncertainties in political stability and economic policies, India is poised to become a 2 trillion dollar economy, and is showing positive signs of growth," said the CEO.

He added, "This is a difficult year to forecast and we would have a look at the numbers again mid year, when some of the variables would be clearer. We term it the year of 'ifs and buts', given the election numbers and the post election scenario, in terms of stability and how corporates would spend".

Srinivas said that there were also too many variables this year, as compared to any other year. "There are issues with regard to when the economy is going to recover, and the media related uncertainties with regard to the Indian Premier League, which is a big AdEx generator, and the chaos with the media measurement and intelligence system. All of this is set to impact AdEx spends,'' he added.

The report has noted that advertisers and media owners alike would face a challenging year given the disruption in measurement parameters. At the moment though, the sentiment of the economy is positive and a great driver of consumer spends, with the fast moving consumer goods (FMCG) sector continuing to dominate.

The report has noted that apart from FMCG, AdEx on auto and retail as well as telecom sector would continue, with a stable increase in ad spends. The CEO said that advertising by political parties is expected to give a boost to the AdEx by up to 2.5 per cent.

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