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India ad spends to grow 18% in 2016: Report

IPG research arm Magna Global says television ad spend is estimated to grow 15.1% and print 8.2%, digital to grow a whopping 67%; sees India biggest seventh biggest ad market by 2020

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Media spends in India will grow 18.4% in 2016, according to the report on the global advertising marketplace released by market services conglomerate IPG's strategic research arm Magna Global.

As China is slowing down slightly, India has become the most dynamic economy among BRICs and among all the large nations monitored by Magna.

Advertising spending grew 16.3% in 2015 to Rs 48,700 crore, allowing India to become the 12th biggest ad market in the world at the expense of Russia. The IPG research arm says India will be the seventh biggest ad market by 2020.

Advertising revenue increased Rs 6,800 crore to touch Rs 48,700 crore in 2015. On the back of increased volumes, Television revenue will add 18.5% (December 2014 11.9%) to reach Rs 20,000 crore.

While television market share is up by a percentage point (41%), print went down from 41% to 38% to touch Rs 18,300 crore (growth of 7.7%). In 2016, Television is estimated to grow 15.1% and print 8.2%.

Digital formats continue to grow the maximum at 49% to touch Rs 5,700 croreand thereby increase its marketshare to 12%. Ad sales generated from video and social increasingly will be through mobile impressions while desktop in the near future will still be the domain for search and display. Share of mobile from 32% will be close to half the pie in 2016. Programmatic outside of Search will grow 5.7%.

Newer formats and revenue streams (Twitter and Instagram opening up new advertising and influencer management platforms), bandwidth expansion through 4G launch and traditional advertisers increasing their digital budgets will contribute to the growth of 67.3% in 2016.

Radio with a market share of 4% will grow +14% in 2015. Through the expansion of footprint and there by volume is estimated to add +16% in 2016. OOH will grow 11.9% in 2015 and by another 10.4% in 2016.
Magna Global estimates total advertising revenue to touch Rs 57,600 crore in 2016.

The T20 World Cup, encouraging response from audience to non-cricketing leagues, state elections, 4G launch are some of the drivers for the advertising economy in 2016. E-commerce will continue to pursue GMVs, most action will be seen in the telecom sector followed by auto and FMCG advertising.

Digital television and expansion of the measurement panel will allow advertisers to reach more consumers and broadcaster to better monetize their audience in 2016. While so far India is bucking the global trend of declining spends on Print by growing at a high single digit rate, Digital market shares are projected to equal print by 2020. Magna Global hopes the 2016 round of data will get the currency out of the data dark period and aid the category to fight market share erosion. The second round of the Phase III auction, commissioning of the new stations won in the first round of bidding will keep radio top-of-mind, the report adds.

Media owner advertising revenues grew globally by 3.2% in 2015 to $503 billion, lower than the previous forecast (3.9% growth in June 2015) and represents a slowdown compared to growth of 4.9% in 2014.

In arrangement with MxMIndia.com

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