Indian ad outlook positive

Warc, 20 August 2014

MUMBAI: The outlook for India's advertising expenditure is bright following some uncertainty at the start of the year ahead of a general election, a leading industry figure has said.

In its latest This Year, Next Year report, GroupM, the media management investment operation of WPP, revised upwards its predictions for growth in India, from 11.6% to 12.5%, the Economic Times reported.

"After a cautious start to the year, the overall sentiment in the country is positive following the general elections and a new stable government," according to CVL Srinivas, CEO, GroupM South Asia.

In particular, he anticipated that the retail sector would contribute strongly to this trend. "With FDI in multi-brand retail taking a backseat, the market will see a surge of local players in this sector," he said, "specifically e-commerce players that are investing heavily in above-the-line advertising along with digital media."

Other sectors expected to register a growth in adspend included FMCG, auto, telecom and banking, financial services and insurance.

Digital media is projected to show the greatest increase, at 35% year on year. TV advertising expenditure has also been revised upwards, from 12% to 14.8%, as a proliferating number of channels accompanies the ongoing digitisation of the nation's broadcasting network.

In the print medium, regional publications and local advertisers are forecast to lead the growth for dailies. Government spending and retail will also continue to increase spending in print.

Not everyone was convinced by GroupM's figures, however, as the chief executive of one broadcast company noted that, despite the optimistic sentiments, advertisers were being cautious.

"Most of them are yet to increase advertising spends," he said. "We will know the real advertiser sentiment in the upcoming festival season," he added.

Warc's International Ad Forecast, released in June, put all media adspend growth in India at 14.0% this year, slowing to 13.5% in 2015. Digital will see the largest growth in 2014, at 36.8%, while TV is forecast to record growth of 13.7%.

Data sourced from Economic Times; additional content by Warc staff