India ad market projected to grow 14.5% driven by digital: Dentsu report

The Indian ad market is projected to grow by 14.5% to reach $12.0 billion in 2023, which will be the third consecutive year of double-digit growth for the country, according to a report by Dentsu.

It is also the fastest-growing ad market in the Asia Pacific category, the report says.

“Growing by 36.6% and totalling $5.0 billion, digital is the primary driving force of the Indian ad market and now takes a 41.4% share of spend. In 2023, digital is actually set to overtake TV to become the largest media in India for the first time. This surge is attributed to the increased penetration of smart devices and internet connectivity,” the report said.

Looking ahead, the Indian ad market is expected to grow by 15.7% in 2024 to reach $13.8 billion.

In Dentsu’s May ad spend global report, global advertising spend is forecast to increase by $23.0 billion in 2023 to reach $727.9 billion, which is a slowdown in growth from 7.9% in 2022 to 3.3% in 2023 owing to economic headwinds.

The outlook for the global advertising market in 2024 is expected growth at an accelerated pace of 4.7% to $762.5 billion boosted by major events such as the Paris Olympics and Paralympics, UEFA Euro, and the US presidential elections.

Peter Huijboom CEO, Media International Markets dentsu said, “Something interesting is happening in the digital space. This year, digital is not forecast to experience double-digit growth. This has only happened twice in the last 20 years: in 2009 (financial crisis consequences) and in 2020 (COVID-19 pandemic). Digital ad spend is expected to grow by a mere 6.6% three-year compound annual growth rate (CAGR) to 2025. The future will tell if this is a temporary slowdown or a true inflexion point toward a structurally slower growth pace for digital.

This does not mean everything is dark and gloomy. First, because we forecast ad spend growth will accelerate again in 2024 but most of all because the media landscape is investing in its reinvention.”

Globally, total TV ad spend is projected to decline by 3.1% in 2023 to reach $170.2 billion, before growing again by 4.0% in 2024. The momentum in the out-of-home (OOH) market continues with 3.8% growth in 2023, driven by digital OOH and fuelled by programmatically-bought inventory.

According to the report, digital is forecast to grow by 7.8% ($30.6 billion) YoY to reach $424.3 billion by the end of 2023. However, 2023 is projected to be the first of three consecutive years of only single-digit growth.