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Business News/ Economy / Ad spends to grow 11.8% in 2023 to reach 1.09 trillion

Ad spends to grow 11.8% in 2023 to reach ₹1.09 trillion

  • Digital ad spends in India slowed down by more than 11 percentage points in 2023

Currently, search takes the lion’s share of digital ad spends (27%) followed by video and mobile (19%), social media (18%) and display ads (16%). Photo: iStockphoto

India's ad spends are expected to grow 11.8% in 2023 to reach 1.09 trillion ($14 billion) market. This growth puts India on track to climb into the top 10 global ad markets by 2028, found a new report.Surprisingly, digital formats, which saw a big growth in 2022, expecting a slight slowdown this year. But it still remained a dominant force, accounting for 46% of the entire ad market share, said the report by IPG Mediabrands India-owned Magna's Global Ad Forecast.

Digital formats' contribution is likely to drop 11 percentage points to 14.2% in 2023 against 25.7% in 2022. In 2024, too, the India advertising market is expected to grow by 11.4% and digital formats is projected to rise 13.9% to reach 56,900 crore ($7.2 billion), while linear ad sales expected a 9.3% growth to reach 65,500 crore ($8.3 billion).

However, traditional media is far from dead in India. Television, despite challenges from free dish and OTT platforms, remains the largest video medium, reaching over 900 million viewers and boasting an average daily viewing time of 222 minutes. Television ad revenues are expected to grow by 9.9% each in both 2023 and 2024.

Print media, too, is experiencing a resurgence with ad sales revenue for newspapers projected to grow by 8.1% in 2023 and 9% in 2024.Radio and out-of-home (OOH) advertising are also witnessing strong recoveries. Radio ad revenues are expected to grow by 12.1% in 2023 and 11% in 2024, while OOH, fuelled by rising screen presence and audience movement, is estimated to grow by 26.7% in 2023 and exceed 2019 market size by 2024, it said.At a macro level, the Asia Pacific advertising economy is expected an 8.2% growth to reach $286 billion this year powered by India, Pakistan and China. In 2024, APAC advertising revenues are projected to grow 6%.

Hema Malik, chief investment officer, IPG Mediabrands India, said: “India continues to script its unique narrative in the advertising landscape, boasting robust growth across diverse mediums despite evolving consumer preferences and market dynamics. The promising trajectory across television, digital, radio, and out-of-home channels signifies the dynamic nature of our advertising landscape. I am optimistic about the future as India's advertising story unfolds, driven by innovation, adaptability, and a burgeoning consumer base."

The out-of-home advertising has consistently grown post the pandemic as audience movement continues to ascend. The report said that rising roadside digital-OOH screens in metros and state capitals as well as substantial presence in ambient spaces have added to demand, leading to growth in digital-OOH spends which contributes 5% of the total.

In 2023, OOH revenue to grow by 26.7% valued at 3,000 crore ($382mn) reaching 90% of the pre-covid market size. This pace will be sustained for a few more years and in 2024, OOH will exceed 2019 revenues, adding 16% to the size. In-cinema advertising is also up sharply as audiences are flocking to cinemas. State-of-the-art technologies like IMAX and Dolby Atmos, has transformed movie-watching into a truly awe-inspiring experience and this has been another reason for audience draw. It will cover 74% of 2019 market size by the end of 2023 with an impressive 43% growth to reach 800 crore ($102 million). In 2024, the growth is estimated to be 19%.

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ABOUT THE AUTHOR

Varuni Khosla

Varuni serves as a Senior Assistant Editor at Mint. Her responsibilities encompass crafting compelling narratives that take a deep dive into hospitality companies, the business of art, luxury brands, the intricacies of the business of sports, advertising and marketing landscapes, gaming insights, tourism and travel industry trends. She also covers alcohol commerce. She is skilled at communication, meticulous research, and insightful analysis keeping contemporary shifts and advancements within the lifestyle and business domains at the heart of her work.
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