Indian Advertising Industry

Market Size

Rs. 48,977  Crore in CY15

Growth Rates

12.6% Annual Growth Rate

Segments

TV Advertising: INR 22,446 Crore

Print Ads: INR 16,872 Crore

Radio Advertising: INR 2,007 Crore

Out of Home (OOH) Advs: INR 2,582 Crore

Cinema Ads: 482

Digital Advertsing: INR 4,661 Crore

Indian Advertising Industry

INDIAN ADVERTISING INDUSTRY 2015[i]

Firms in the advertising industry prepare advertisements for other organisations and design campaigns to promote the interests and image of their clients.

This industry also includes media representative-firms that sell advertising space for publications, radio, television, and the Internet; display advertisers-businesses engaged in creating and designing public display ads for use in shopping malls, on billboards, or in similar media; and direct mail advertisers. A firm that purchases advertising time (or space) from media outlets, thereafter reselling it to advertising agencies or individual companies directly, is considered a media buying agency.

ADVERTISING INDUSTRY MARKET SIZE AND GROWTH

Advertising spends in India are expected to grow 12.6% year on year to Rs 48,977 crore for the year 2015. The ad spend in 2014 was Rs. 43,490 crore, which reflected a 12.5% increase over 2013. 

The higher growth has been attributed to increase in spending due to elections (both general and state elections) and advertising from categories like e-commerce and telecom.

Between 2013 and 2018, India is projected to be the second fastest growing advertising market in Asia, topped only by China.

ADVERTISING INDUSTRY SEGMENTS[ii]

INR Cr[iii]

2015 -Ad Expenditure

TV

22,446

Print

16,872

Radio

2,007

OOH

2,582

Cinema

482

Digital

4,661

 

1. Television

– Television shows a higher growth percentage in 2015 compared to last year with 16%.

– TV channels will especially be bullish with cross media integration via their own digital platforms.

– The big ticket event this year was the ICC Cricket World Cup in February and March

2. Print

– Even with pressures on advertising revenues, the print medium showed an increase by 5.2% as against the 2014 estimate of 7.6%

– Print magazines continue to be on the decline, as several are looking at digital delivery mechanisms.

– It’s wide regional reach shall still be an advantage that print advertising can cash in on.

3. Radio

– Radio in India is expected to grow at a heartening 17% over the next 5 years.

– It is expected to gain further popularity, backed by increased device adoption.

– With the auction of phase 3 FM licensing announced by the GOI, increase is expected in the listenership and the share of revenues for the Radio segment.

4. OOH (Out of Home)

– The Indian OOH advertising industry has seen an increase from 2,483 crore in 2014 to 2,582 cr in 2015, at a growth rate of 12%

– This growth was driven by the fact that consumers are spending more time out of their homes and the chances of seeing billboards and other mediums of OOH advertising are much more.

– Transit advertising is emerging as the fastest growing segment of OOH advertising. The major categories are billboards, transit, alternative, and street furniture.

5. Cinema[iv]

– Cinema advertising is expected to grow by 20 per cent, as multiplex chains consolidate.

– This growth was driven by the fact that the medium becoming more organised and accountable.

– Ads in cinemas are anywhere between 30 to 60 seconds, giving advertisers more room to drive home their communication message.

– Cinema advertising, at the end of 2014, clocked a 25 per cent increase in spends.

6. Digital

– Digital media continues to show the maximum growth with 37% in 2015.

– Video, Mobile and Social to be the biggest growth drivers.

 

PRIVATE EQUITY AND M&A IN ADVERTISING INDUSTRY[v]

Year

Acquirer

Target

Target/Transaction - Note

Type

2013

Publicis Group

Convonix

Systems

Publicis acquired Convonix, a

full-service digital marketing and consulting agency, based in Mumbai.

M&A

2013

Dentsu Media

Webchutney

Studio

Dentsu acquired an 80% stake in Webchutney, a digital marketing company.

M&A

2013

Peppul Capital

Komli Media

Komli Media raised 30 million USD from new investor Peepul Capital. Komli Media is Asia Pacific's leading media technology company.

PE

2015

Dentsu Aegis Network

Fountainhead Entertainment

Fountainhead Digital is an Online Marketing, Technology and Content Development agency

M&A

 

ADVERTISING INDUSTRY LISTED FIRMS[vi]

Name

Revenue

EV

EBITDA

EV/Rev

EV/EBITDA

Growth in Rev

Pressman Advertising Ltd

461.2 Mil

576.1 M

62.9 Mil

0.8x

7.3x

-39.20%

 

TOP ADVERTISING AGENCIES IN INDIA[vii]

Name

Key People

Major Clients

Head Office

Ogilvy & Mather

Piysuh Pandey, Executive Chairman and John Goodman, CEO

IDBI Mutual Fund, SBI Mutual Fund, TTK Textiles , J K Tyres, Pantaloon Fashion India Ltd, Cadbury, Louis Philippe, UTI, TVS Suzuki

Mumbai

Crayons Advertising and Marketing Pvt Ltd

Kunal Lullani, Managing Director

Marshal, Jindal art glass

New Delhi

McCann Erickson India

Santosh Desai, President

Coca-Cola, Nestle, BPL, Khaitan

New Delhi

Lowe Lintas

Pranesh Misra, President

ITC, Johnson & Johnson, Air France, BPL, Nestle India Ltd

Mumbai

Creative Advertising

Vishwanath Iyer, Director

Trendly systems

Mumbai

J. Walter Thompson

Colvyn J harris, CEO

Pepsico, DYC, Hero Honda Motors, Glaxo Smithkline, Frito Lays India, HPCL, Unilever Home

Mumbai

Chaitra Leo Burnett Pvt Ltd

Arvind Sharma, Managing Director

ICICI, Bajaj Auto, Dabur India, BPL Ltd, Coca –cola, Toyota, Amtrex Hitachi

Mumbai

Mudra Communications Ltd

Madhuka Kamath, CEO

Mahanagar Telephone Nigam Ltd, Indian Express, Mid-Day, Global Trust bank, Indian Tourism Development Corporation, Business Standard, Raj TV, Henkel Spice India

Ahmadabad

Grey Worldwide

Ashutosh Khanna, CEO

Ministry of Tourism, ONGC, Gujarat Ambuja, Chhattisgarh Tourism, Haier Appliance

Mumbai

Akshara Advertising

S K Swami, CEO

University of Rajasthan, ONGC, MTNL

New Delhi

 

TOP DIGITAL MARKETING AGENCIES IN INDIA[viii]

Name

Description

Clients

Webchutney

This is one of the top digital marketing firms of the country.

Boston Consulting Group, Airtel, MakeMyTrip, BookMyShow, Tata Motors, Unilever, P&G, HP, Airtel, Microsoft, carslberg and Suzlon.

BC Web Wise

Digital solutions range from website development to online marketing that includes social media and search marketing, as well as media planning and buying.

Hero Honda, airtel, Microsoft, ITC, HUL, Kellogs, GroupM.

Avignyata Inc

digital marketing company include social media marketing services, online monitoring

Inorbit, OVS Industry, Educationtimes.com, Shoppers stop, Sony pictures, Bigg Boss, Big Music, Bloomberg UTV, Murder 2, Movie I AM, Movie Tahaan, Walt Disney Pictures, Movie Zohan

Windchimes Communication

social media agency that provides innovative solutions for brand marketing and social media management

Pond’s, SESA Goa LTD, GE, HDFC Bank, ITC Hotels, Sony Pix, Hindustan Unilever Limited, Lavasa, Thomas Cook, TVS Scooty, Bajaj Allianz, Emerson, Sony Music, Red Bull, ebay.in, Marico, Tommy Hilfiger, Sil, ITC-WelcomGroup, Ginger, Big Bazaar, etc.

Sparrowi

Interactive agency creating digital content starting from websites

DLF, HCL, HMEL, Honda, Intex

Blue digital

Services that are focused on marketing solutions which aim towards various digital formats.

Pearl Academy, Span, Geojit, DWA, BIFM

Flare Path

Provides end-to-end, creative content marketing services and products.

Diesel, Movies Now, ET Now, Channel V, AZA, NDTV

Alive Now

full-service award-winning social media agency offering a wide range of social media services

Hard Rock Cafe, Pepsi, Hyundai, California Pizza Kitchen, Nandos, Chevrolet, KIA, Subaru, ITC, Prestige TTK,

Interactive Avenues

full-service digital marketing company include media, creative, search, analytics, mobile, social and ORM

Tanishq Mia, Mumbai Fighter, American Express, GNIIT, Durex Play O, Toyota Prius, Sony Walkman, Intel

Softz Solutions

Digital marketing agency boasts of a global clientele from all around UK, USA, Australia, Ireland and other European countries

9Round, Inspire Wifi, Big eye deers

 

ADVERTISING INDUSTRY GROWTH DRIVERS[ix] [x] [xi]

  • Funded e-commerce start-ups advertising heavily to capture marketshare
  • Mobile and internet adoption driving digital media advertising growth
  • Increased literacy rate in tier II and tier III cities driving print advertising
  • Evolution of targeted advertising (Separate HD channels for premium brands, Geographic advertising for local ads)
  • More multinational entrants under single brand retail are likely to add to retail spending
  • Higher spends from the Central Government as they showcase their new initiatives
  • Digitization of the OOH media in India and advent of new avenues for advertising


[i] http://advertising.indiabizclub.com/info/advertising_industry

[ii] http://www.medianama.com/2015/02/223-advertising-in-india/

[iii] http://www.indiainfoline.com/article/news-top-story/groupm-estimates-indian-adex-to-increase-by-12-6-in-2015-115020300193_1.html

[iv] http://www.afaqs.com/news/story/43163_Indian-AdEx-to-increase-by-126-in-2015-GroupM-Report

[v] http://www.pwc.in/assets/pdfs/india-entertainment-and-media-outlook/india-entertainment-and-media-outlook-2014.pdf

[vi] http://www.gurufocus.com/term/pettm/BOM:509077/P%252FE%2BRatio%2528ttm%2529/

[vii] http://companiesinindia.in/advertising-agencies-in-india/

[viii] http://www.mindandmatter.in/digital-marketing/top-25-digital-marketing-companies-in-india/

[ix] http://www.exchange4media.com/advertising/indian-advertising-industry-grew-by-16.4-in-2014-almost-at-par-with-our-projection-of-16.8sam-balsara_59164.html#sthash.P9qZqtsB.dpuf

[x] https://www.kpmg.com/IN/en/Press%20Release/Frames-2015-Information-Note-KPMG-in-India.pdf

[xi] http://www.medianama.com/2015/02/223-advertising-in-india/