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NEW DELHI : Digital advertising in India is expected to equal television advertising and may even surpass the latter by 2023, according to a new report. Digital spends will clock a third of all advertising spends in India by that year, found the report by advertising agency Dentsu India titled Digital Advertising in India 2022.

Out of expected total advertising of 93,119 crore, digital advertising will account for Rs. 35,809 crore by 2023 at 14.75% CAGR. The report added that it expects the advertising industry to reach 81,025 crore by the end of this year, 2022, with a growth of 14.6%.

The Indian advertising industry in 2021 stood at 70,715 crore, up 18.6% over 2020. The report added that the digital advertising industry has witnessed a growth in market size from 15,782 crore in 2020 to 21,353 crore in 2021, growing at 35.3% CAGR. Digital media is expected to grow at 29.5% CAGR by 2023.

But television still maintains the largest share of media spending at about 42% or 29,279 crore, followed by digital at 30% or 21,353 crore and print at 24% or Rs16,599 crore.

Of this, fast-moving consumer goods (FMCG) brands have the highest contribution of 34% of 23,736 crore towards the entire advertising industry, followed by e-commerce at 14%, 9,619 crore and automotive at 7% or 4,745 crore.

Advertising revenues have seen a growth of 18.6% over the last year. This growth can be attributed primarily to the BCCI-backed Indian Premier League (IPL); ICC T20 World Cup, Asia Cup 2021 and the upcoming assembly elections in five states.

Digital is growing

In digital too, the trend remains similar, the biggest contributors to the digital media industry is FMCG at 42%, 8,928 crore of spends while e-commerce is a tad higher than that on television at 17% or 3,607 crore while some other categories like consumer durables and pharmaceuticals are more significant contributors digitally at 6%, 1,368 crore and 5%, 1,124 crore respectively.

In the digital space, in 2021, 75% of digital advertising spends were recorded on mobile devices. India will continue to rise in the global economy in the coming years, driven by digital, said Narayan Devanathan, chief client officer at Dentsu India.

He added: “Notwithstanding the devastation caused by Covid-19’s second wave in 2021, we have seen a dramatic upsurge in digital in ways we have not seen before."

Spends on digital media are largely led by social media, which has the largest share at 29% or Rs. 6,218 crore, closely followed by online videos at 28% or Rs. 5,907 crore and paid searches at 23%, Rs. 5,039 crore. Additionally, most of the online expenditure on mobile devices goes to social media (30%) and online video (30%).

FMCG, education and media & entertainment verticals spend the largest share of their digital media budget on online video, while pharmaceuticals and e-commerce spend the most on paid search.

The report, the company said, is compiled by conducting interviews with advertisers across industry verticals, media agencies, online publishers and ad networks to understand their advertising investments across media, along with other focus areas in digital media. Secondary research was also done to identify the market structure and dynamics of the digital ad market in India.

 

ABOUT THE AUTHOR

Varuni Khosla

Varuni Khosla is a journalist with close to 14 years of experience in writing business news stories for mainstream newspaper companies like Mint and The Economic Times. She reports and writes on luxury and lifestyle brands, hospitality and tourism news, the business of sports, the business of advertising and marketing and alcohol brands.
Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
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