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Forecasts by some top media agencies, such as GroupM, Dentsu and Interpublic Group’s Magna, of Indian advertising expenditure (adex) growth for the calendar year 2023 remain buoyant despite a slowdown seen in startup advertising in the country.
India’s adex growth rate will also surpass the global adex average of 5-6 per cent pegged by these advertising networks for 2023. It will also go past Brazil to become the eighth-largest advertising market in 2023 from ninth-largest in 2022, led by a push in digital and television advertising, they say.
The three agencies peg Indian adex growth to be in the region of 14-16 per cent in 2023, similar to the levels seen in 2022. GroupM, for instance, says India will close the current calendar year with a year-on-year advertising growth of 15.8 per cent, with the total domestic advertising market size at $14.9 billion (Rs 1.22 trillion). Dentsu and Magna also peg India’s adex growth for 2022 at 15 per cent each.
In 2023, GroupM says that India’s advertising market will accelerate to levels of about 16.8 per cent in terms of growth rate, the most aggressive forecast of the three agencies. Dentsu’s India head of research and consumer insights, Abheek Biswas, on the other hand, says that India’s adex growth rate will continue to be in the 15 per cent range. While Magna sees India’s 2023 adex growth at 14-14.5 per cent, ahead of China, whose adex growth for 2023 is projected at 7 per cent, recovering from the sharp deceleration it saw in 2022 due to lockdowns and the Chinese government’s stringent zero-Covid policy.
“India’s economic outlook appears to be stronger relative to other markets with the IMF projecting a real GDP growth of 6.8 per cent in 2022, positioning it as one of the fastest growing economies in the world. Fiscal policy drivers, such as improved investments in digital infrastructure, a growing labour force and becoming an attractive exporter, partly explains its strong growth. All of this will aid domestic advertising,” Kate Scott-Dawkins, global director, business intelligence, GroupM, said.
Leigh Terry, chief executive officer, Mediabrands (APAC), part of the Interpublic Group, said that India and Australia would lead advertising growth in the APAC region in 2023. “The Asia Pacific ad market will expand by 6 per cent, which is higher than the global average of 5 per cent in 2023. This will be in-line with the long-term growth projected for the region, led by India and Australia,” he said.
Factors contributing to this growth remain digital advertising, says Dentsu’s Biswas, which has been growing at a pace of around 30-32 per cent per annum, a trend that will stay in 2023 as well.
“Digital advertising has been growing at a steady clip right through 2022 despite startup advertising slowing down during the year,” he says. “Traditional advertisers such as fast-moving consumer goods, banking and financial services, auto, telecom and e-commerce have stepped up advertising on digital. This has helped maintain digital’s pace of growth in terms of domestic advertising,” Biswas says.
Both Dentsu and GroupM project digital advertising to be larger in size to television advertising at 45-48 per cent of the total domestic advertising market. TV advertising is expected to be in the region of 35-36 per cent in terms of size, they say.
“Pure-play digital advertising in India has been growing and will continue to rise above pre-pandemic levels in 2023,” Scott-Dawkins says. “Television advertising, on the other hand, is expected to grow 10.8 per cent in 2022 and will continue growing double digits in 2023, driven by strong growth in both traditional and connected TV in India,” she adds.
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