India’s advertising market is poised for significant growth, expected to reach a market size of INR 1099 billion ($14 billion) by 2024, marking an 11.4% increase. This growth trajectory follows an 11.8% rise in 2023, illustrating the dynamism and expansion in the Indian advertising sector.
Digital Advertising: The Leading Contributor
Digital formats are the major drivers of this growth, representing the largest segment with a projected value of INR 569 billion ($7.2 billion) by 2024. This accounts for a 46% share of the entire advertising market in India, signifying the critical role of digital media in the current advertising landscape.
Growth Across Various Formats
- Television and Print: Both mediums are expected to grow, maintaining their relevance in the advertising space. The television sector, in particular, is set to witness a 9.9% growth, reaching INR 401 billion ($5.1 billion) in 2024.
- Radio and Out-Of-Home (OOH) Advertising: These sectors are experiencing a robust recovery, with radio anticipated to grow by 12.1% and OOH by 29.8%, although they still fall short of pre-COVID revenue figures.
Underlying Economic Factors
The Indian economy, with its large consumer base and the aspirations of young adults, is a significant factor driving advertising growth. The economy is relying on domestic demand, private consumption, and investment spending for growth, creating an optimistic and upbeat market atmosphere, despite complexities due to local and global pressures.
Sector-Specific Insights
- Consumer Packaged Goods (CPG), Automotive, and Fintech: These sectors are the most dominant contributors to India’s advertising growth, followed closely by government, communication, travel, and real estate sectors.
- E-commerce and Retail: These sectors are expected to see average growth, with startups shifting focus to performance marketing over brand marketing.
Digital Ecosystem and Government Initiatives
India’s digital ecosystem is being bolstered by government initiatives such as Aadhar, UPI, and DigiLocker, enhancing digital public goods. Additionally, the rising internet user base and affordable devices are significant contributors to the digital advertising economy’s growth. The government’s initiatives to develop 5G services are expected to further influence the digital advertising sector positively.
Challenges and Opportunities
Inflation and economic policies, such as the Union Budget’s focus on manufacturing and infrastructure, will impact the advertising market. The advertising spending growth rate, driven by young working adults investing in experiential-led categories, remains robust at +11.8% in 2023.
Conclusion
The Indian advertising market’s projected growth in 2024 reflects a rapidly evolving landscape, driven primarily by digital media’s dominance, alongside significant contributions from traditional advertising mediums. The sector’s expansion is underpinned by economic growth, digital advancements, and a shift in consumer behavior, indicating a promising future for the advertising industry in India.