The first half of 2024 (H1 FY24) was rather eventful for the Indian advertising industry, with favourable winds that cleared a grim period we saw around the same time in 2023. Automobiles, FMCG, durable goods and pharma sectors outshined others, along with beverages like Pepsi and Coke raking in good moolah. Overall, the numbers panned out well for the industry and aligned with the projections made at the beginning of the year.
Industry reports had indicated a significant jump in India’s ad revenues for 2024, estimating a 9-10.5 per cent growth rate. While the TAM report anticipated a growth rate of 9.5 per cent, GroupM’s TYNY forecasted a 10.2 per cent increase in ad revenue, reaching $18.5 billion in 2024.
When juxtaposed globally, the report stated that the global advertising industry will surpass, for the first time, $1 trillion in total revenue in 2024 and climb 7.7 per cent in 2025 to $1.1 trillion. Defying predictions of a slowdown, the advertising sector—powered by digital innovation—gained momentum in 2024 across regions.
The Media Rundown
Giving us an overview of all the different media, Gaurav Sinha, Head of Marketing & PR, Audi India, comments, “The growth in 2024 was driven by digital advertising, which now accounts for nearly half of the total ad spend. Digital media dominated by formats like social media, search, video, and ecommerce ads are growing rapidly. OOH advertising also reaped its benefits with digital formats like DOOH
Television, on the other hand, benefitted from events like the ICC T20 Cricket World Cup and general elections. However, despite moderate growth in certain quarters, print remained below pre-pandemic levels.
Undoubtedly, video (primarily connected TV and digital video) savoured the maximum growth in H1 FY24. The flexibility to align with different budgets made these mediums increasingly popular and impactful for advertisers
To substantiate, one of the mFilterIt reports reveals that the BFSI sector allocated a significant 70 per cent of its advertising volume to CTV platforms, highlighting a strategic emphasis on connecting with audiences through this medium. Meanwhile, the F&B sector demonstrated a 60:40 ratio favouring CTV over other platforms, reflecting its inclination to prioritise CTV in advertising campaigns.
Festive Adex Brings Buoyancy
Segueing into the second half of the year, marketers are optimistic about the silver lining that the festive time has displayed, backed by an uptick in consumer sentiment.
Retailers, including those in the FMCG sector, for example, garnered at least 10-12 per cent growth over last year’s sales, according to Wright Research.
The adex also grew at a steady rate in July and picked up further in August and September, considering all the festive campaigns. Brands across sectors were seen ramping up their advertising investments in the October-December quarter of the fiscal year 2024, registering a noticeable drive to capture market share amidst festivities and sporting extravaganzas
According to TAM AdEx's most recent study, FMCG stood as the major contributor yet again. When compared month to month, May 2024 had the highest share of FMCG TV ad volumes (18 per cent). In print, January 2024 had the greatest share of FMCG advertising space at 20 per cent. Digital advertising in the FMCG sector increased by 7 per cent in H1 2024 compared to the previous year.
Top players such as Hindustan Unilever (34.49 per cent), Dabur (36.13 per cent), Colgate Palmolive India (20.20 per cent), Godrej Consumer Products ( 24.47 per cent), recorded a double-digit spike in advertising and promotional expenditure for the October-December quarter, year on year.
Shiny Road Ahead
The Indian advertising and marketing industry is poised for significant growth in 2025, expected to grow at a compound annual growth rate (CAGR) of 9.86 per cent, reaching approximately ₹1.12 lakh crore by 2025, according to a Dentsu report.
Digital advertising, on the other hand, is anticipated to register a CAGR of 23.49 per cent, increasing from ₹40,685 crore in 2023 to ₹62,045 crore by 2025, brought on by the pervasive use of AI and an ongoing shift to digital channels.
“As we move into 2025, the focus will be on the growing adoption of AI, real-time interactions, and intuitive platforms,” attests Puneeth Bekal, EVP & CMO, HDFC Securities.
In terms of shifts in consumer behaviour, a positive rural sentiment, bolstered by favourable monsoons and diversified income sources, will lead to increased consumption in these areas. This shift will prompt brands to tailor marketing strategies to rural consumers. Urban markets, sadly, may experience a slowdown in consumption, necessitating a focus on value-driven marketing and premiumisation to cater to discerning urban consumers, where technology fuels the processes.
“Augmented reality, AI-driven personalisation, and programmatic advertising will drive innovation in digital formats. TV and print will see steady growth due to their continued relevance in rural and semi-urban areas,” supports Sinha.
While the past decade’s brand composition was driven by baby boomers, Gen X, and millennials, it is going to change in the next five years with Gen Z becoming a major component across segments and categories, believes Jiten Mahendra, Customer Care Associate & Chief Marketing Officer, Shoppers Stop.
“The relationship between brands and consumers will evolve on experience, engagement, and exclusiveness. Media selection will also evolve based on which medium has a higher affinity than reach, especially if it is driven by these three factors. It is only when brands want to do a reach campaign that conventional mediums like print and TVC will be favourable,” he adds.
The arrival of the new year will demand brands and marketers to navigate the ever-dynamic landscape of marketing by embracing technological innovations, understanding regional market nuances, and adapting to regulatory changes to effectively engage with the diverse Indian consumer base.
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