Home >Industry >Advertising >Telecom advertising in India to grow at 11% by 2023: Report

New Delhi: India will be the fastest-growing market for telecom advertising between 2020 and 2023, registering an 11% annual growth, said a report by media agency Zenith.

This is much higher than the telecom advertising globally which is predicted to grow at an average rate of 4.5% a year to 2023 as its recovers from an 8.7% decline in 2020, according to Business Intelligence – Telecommunications report, published on Monday.

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Telecom ad spend in the 12 key global markets included in the report will rise from $17.8 billion in 2020 to $18.7 billion in 2021, and then return to its pre-pandemic level of $19.5 billion in 2022.

Telecom segment comprises services and equipment facilitating the transmission of voice calls and data by land lines and mobile networks.

According to eMarketer, only 31% of the population in India currently has a smartphone, but thanks to the launch of low-price handsets such as the Jio phone, this proportion is rising rapidly.

“The telecom sector in India in 2021 is anticipating a robust growth on the basis of an increase in tariff pricing, demand for data, growing number of mobile users and hopefully the launch of 5G in the last quarter. This will lead to a substantial increase in media investments by the key players especially on television & digital," said Jai Lala, COO, Zenith India.

While most of the global markets are forecast to grow between 3% and 6% a year to 2023, Russia will grow at 8% and France at 6%.

In terms of key trends, the report stated that smartphone sales will start to spring back this year once consumers feel more confident in their future. Consumers are becoming more willing to finance and purchase handsets independently from their network providers, giving manufacturers and retailers a greater incentive to advertise handsets themselves.

Meanwhile, the networks will seek to recoup their investment in 5G licences and infrastructure through new services and more expensive data packages.

Globally, telecom brands are cutting back their spending on traditional media platforms. Zenith forecasts that between 2019 and 2023, telecoms brands will reduce their television ad spend by an average of 2% a year, compared to a 3.5% annual reduction across all categories. They will also reduce their radio ad spend by 2.8% a year, compared to 4.1% a year for the market as a whole.

Telecom brands will increase their digital ad spend at an average rate of 5% a year between 2019 and 2023. By 2023, digital advertising will account for 54% of all telecom advertising.

“Covid-19 has demonstrated how dependent we are on good, fast and reliable internet connections. Telecoms companies have been the unsung heroes of the pandemic, shifting our lives online and keeping us connected to entertainment, work and commerce. The spread of 5G and the reality of our new-found virtual lives give telecom brands the opportunity to move into the limelight," said Ben Lukawski, global chief strategy officer, Zenith.

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