At 16.4%, Madison predicts Indian adex growth higher than GroupM in 2019

A day after GroupM’s ‘This year next year’ report that predicted 14% adex growth in 2019, Madison released its forecast for advertising spend in India for 2019. According to Madison’s report, 2019 adex is projected to grow at 16.4% to reach Rs 70,889 crore.

At Rs 60,908 crore, the growth was 14.6% in 2018, up from the agency’s prediction of 12.8% and almost double the growth rate achieved in 2017. TV still continues to be the largest contributor to adex with a 38% share, followed by print at 32%, digital at 19%. Outdoor, radio and cinema’s share has remained steady at 6%, 4% and 1% over the last three years.

The agency said that the reasons for high forecast are upcoming parliamentary elections, increase in government spending to showcase its achievements, the upcoming ICC Cricket World Cup 2019, growth of OTT, increased spending in rural and India moving to a consumption society. The highest growth will come from digital at 33%, followed by cinema at 30% (although on a very small base), followed by TV (18%), radio (12%), outdoor (11%) and print (5%).

Sam Balsara

Sam Balsara, Chairman, Madison World, said, “After two dull years, 2018 has seen significant growth in television and digital and we expect the momentum to continue in 2019. With this growth, India has regained its pole position of being the fastest growing advertising market in the world and is expected to retain this position even in 2019.”

TV:

1. TV grew by an unbelievable 19% to reach close to the Rs 23,500-crore mark. 

2. This is the highest growth TV has witnessed in last three years. In terms of absolute numbers, TV advertising has grown by Rs 3,782 crore in 2018.

3. And its share in the adex pie stands at 38%. While its share has declined over the decade from 43% in 2009, it is significant that since 2015, it has increased its lead over print and now the gap in share is as much as six percentage points.

4. The main categories that have fuelled the overall growth of Rs 3,782 crore in 2018 are the evergreen FMCG (Rs 1,660 crore) and auto (Rs 360 crore). E-commerce too grew dramatically by 29% to reach Rs 1,100 crore from Rs 850 crore in 2017.

5. FMCG continues to rule the roost, contributing as much as 50% to the total television adex, followed by telecom at 12% and auto at 8%.

6. Increase in FCT has also been a big contributing factor to the overall increase of 19% in the TV advertising market. The overall FCT demand in 2018 has increased by 12% led by growth in frequency channels and new channel launches.

Print:

1. India probably is the only major market where print adex is actually growing year on year.

2. Print grew by 4.4% during the year, marginally lower than our projection of 5%.

3. However, print continues to be second highest contributor after television with a share of 32%. And this share of adex is also the highest in the world.

4. The resilience of print is brought out in the fact that it has 200,000 advertisers and the number is growing, compared to TV which has only 12,000 advertisers.

5. Nearly 75%, of print’s growth of Rs 820 crore is accounted by just five categories — FMCG, education, auto, retail & e-commerce.

6. In terms of volume, Hindi publications continue to be ahead of English publications contributing 35% of the total volume, while share of English publications dropped by 2% and now contributes 25%.

Digital

1. The digital advertising market had an impressive growth of 26% in 2018. It has been growing at a compounded annual growth of 30%+ for last 10 years and 24% for last five years.

2. The continued growth of digital is fuelled by mobile, online video and social media, which are increasingly attracting more advertising investment.

3. One of the key reasons for this growth has been the proliferation of OTT platforms. The OTT playing field has seen a 3.5x increase in number of players from just nine players in 2016 to 30 players now.

4. Digital adex at Rs 11,705 crore is now 19% of adex in 2018. It was only 9% in 2013.

5. Google and Facebook continue to dominate digital spends cornering 80% of the total digital pie.

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