
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 |
|
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/