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Business News/ Industry / Ad spending in India to grow at a slower pace in 2024, says GroupM
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Ad spending in India to grow at a slower pace in 2024, says GroupM

India continues to be ranked eighth globally among ad markets, but its ad revenue growth is the fastest among the top 10 economies, according to the media agency

Digital media advertising commands 57% of the total ad spending pie in India. (iStock)Premium
Digital media advertising commands 57% of the total ad spending pie in India. (iStock)

MUMBAI : Advertising expenditure in India is expected to grow at 10.2% in 2024, slower than last year’s 11.3%, according to media investment company GroupM. But even at that pace, India would still be among the fastest-growing ad markets globally.

Overall advertising expenditure this year is expected to increase by 14,423 crore to 1,55,386 crore, GroupM said Tuesday in its annual forecast titled ‘This Year Next Year’.

In absolute terms, that’s about the same amount spent on advertising in 2023, when growth in ad spending turned out to be slower than the initial 15.5% pace GroupM had projected.

Digital media advertising is expected to grow by 13% to reach 88,502 crore in 2024, cornering 57% of the total ad spending pie, according to GroupM.

“The advertising landscape is evolving with the fragmentation of search, the rapid rise of influencer marketing and retail media," said Ashwin Padmanabhan, president-investments, trading, and partnerships, at GroupM India.

“Within digital ad revenue, search contributes 22%, retail media 18%, and the rest 60%. Sectors like auto, realty and offline retail are expected to power the overall advertising growth," he said.

Television is expected to grow by 7% and contribute 29% of the total ad spending, down from 30% in 2023. Cinema is expected to see the highest growth of 15%, although from a low base, to touch 879 crore, GroupM said. 

The agency highlighted that unlike in western markets, where traditional media is declining, in India traditional media is also growing. 

Print, for instance, is expected to grow at 5% to reach 15,350 crore in 2024, commanding a 10% share of the total ad pie.

Last year, GroupM had to lower its growth forecast twice, from the original 15.5% to 12% in June and further down in December to 11.2%. 

“We had cut our full-year growth forecast from 15.5% to 11.2% last year, but ultimately, 2023 ended with 11.3% growth. Despite facing macroeconomic challenges, we remain optimistic about the industry. At 10.2%, India will be the fastest-growing top market," said Prasanth Kumar, chief executive, GroupM South Asia. 

“2024 will also see an upside from the spends leading to the general elections. Digital, particularly retail media and digital extensions of TV, are expected to drive the growth. [The small and medium enterprise segment] continues to fuel the growth," he added.

GroupM said India continues to be ranked eighth globally among advertising markets, and that its ad revenue growth is the fastest among the top 10 economies. The US, China and the UK are the top three markets, as per the report. 

Highlighting a critical trend for the ad industry, GroupM said India had about 34 million homes with smart televisions connected to the internet in 2023, and that it expects the number to reach 45 million homes this year. 

The report said that besides a rapid increase in broadband connection at homes and all new TVs sold being smart, content has played a key role in driving the growth in ad spending.

About “21% of Indian TV homes are going to be addressable, and by 2024 we expect addressable TV to reach over 45 million homes," said Atique Kazi, president-data, performance, and digital products, GroupM India.

“The power and impact of TV, the levers of digital audience discovery, and audience targeting becomes a channel of choice for marketers to make impactful TV ads for personalised and localised experience."

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ABOUT THE AUTHOR
Gaurav Laghate
Gaurav Laghate is the chief of Mint's Consumer Bureau that covers FMCG, consumer durables, retail, media, advertising, hospitality, luxury and the business of sports. An accomplished business journalist with a career spanning over 15 years, he has reported on the significant advancements in the media and entertainment industry, as well as the business of sports. Beyond his role as a journalist, Gaurav is recognised as a steadfast observer of the media landscape, having spoken at several industry events and panels.
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Published: 13 Feb 2024, 06:36 PM IST
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