SMEs to power AdEx in 2026; quick commerce opens new media inventory: Ashwin Padmanabhan

New Delhi: The next leg of India’s advertising growth will be driven by SMEs as large platforms use AI to make it easier for smaller brands to buy media, Ashwin Padmanabhan, COO South Asia, WPP Media, said at the TYNY report launch.

“The biggest driver of ADEX for us in India has been the SME sector,” Padmanabhan said. He added that large platforms will make it easier for SME brands “to actually advertise and reach their consumers faster, better, maybe in more efficient ways” as AI models start powering ad tools.

WPP Media’s TYNY 2026 report highlighted the structural rise in SME participation in advertising. A chart in the TYNY handout tracks “SME share of advertising” rising from about 12% to about 40% over time, alongside the broader increase in advertising intensity in India.

Padmanabhan positioned the SME shift within a broader move towards accountable media. “The advertising landscape in 2026 will be defined by outcome and intelligence,” he said, adding that “AI-powered consumer engagement is accelerating outcome-driven formats.”

Quick commerce moves from channel to media

After SMEs, Padmanabhan flagged quick commerce as another significant planning variable for marketers in 2026.

“Quick commerce is at a point of inflection, moving from a sales channel to an important media choice,” he said. “Advertisers’ success will be driven by their ability to capture consumers at the intersection of discovery and transaction.”

That framing maps to WPP Media’s channel forecast, which expects commerce to be the fastest-growing segment in 2026 at 24.2%. Intelligence, which includes search and AI search, is forecast to grow 8.0%, while location is seen growing 8.9%.

In the TYNY classification, commerce includes marketplaces, delivery companies, retailer properties, travel platforms, and financial services companies, which is the ecosystem where quick commerce media is being packaged and sold.

Padmanabhan also linked quick commerce to FMCG premiumisation. He said premiumisation in FMCG continues, and added that quick commerce is enabling it to happen faster because it is a go-to-market channel suited to premium products.

Yesterday, February 18, Hindustan Unilever, one of WPP’s biggest clients in India, announced plans to invest up to Rs 2,000 crore to expand manufacturing capacity in fast-growing premium categories across Beauty and Wellbeing and Home Care liquids.

India adex forecast and why money is shifting

WPP Media forecasts India adex at Rs 201,891 crore in 2026, up 9.7% from Rs 184,046 crore in 2025. The TYNY report forecasts digital at 68.1% of total adex in 2026, including digital extensions of TV, audio, print and out-of-home.

Padmanabhan said content-led formats are steadily losing share as budgets move to commerce and intelligence. The TYNY handout pegs content-driven formats at 70% in 2026 and projects content share declining from 91% in 2010 to 70% in 2026, as commerce rises.

FMCG, auto, tech, BFSI, e-commerce and retail signals

Padmanabhan said 2025 was a rebound year for rural growth, especially for CPG and FMCG, and said that trend continued. 

He said the impact of GST started flowing into CPG towards the end of last year and supported volumes, while monsoon remains a swing factor for consumption. He also flagged expected raw material inflation as a potential pricing pressure.

On auto, he said, “Auto was a good year in 2025, with 8% growth in vehicle registrations.” He said growth was seen across commercial and personal vehicles, including tractors and commercial vehicles, which he linked to rural and broader economic activity. 

He said EV continues to grow, led by commercial vehicles and two-wheelers, adding: “So 4% of all personal vehicles and about 6% of all the two-wheelers were EVs in 2025.” He also flagged risks around rare earth magnets and high-end chip shortages.

On tech, he said, “AI war is going to heat up,” citing Google Gemini, OpenAI, Anthropic and Perplexity competing for attention and usage. He added that handset features will become a preference driver, but powerful chips are in short supply, and that could push up prices for AI-enabled phones.

On BFSI, Padmanabhan said personal loan portfolios are growing on consumption spends such as holidays and consumer durables, which is positive for advertising, but he cautioned that declining savings and deposits could put stress on banks’ ability to lend.

On e-commerce, he said the growth focus has moved beyond tier 2, and that festive 2025 volumes for most platforms came from tier 2 and tier 3 towns. He said expanding the consumer base will be critical for e-commerce and quick commerce, adding that quick commerce faces user stagnation risk unless it penetrates deeper and wider.

He also said retail revived in 2025 after more than three years of a slump, led by festive demand, and said new store launches across brands indicate the trend is continuing.

Microdrama, creators and commerce outcomes

When it comes to brands’ interest in advertising on microdrama platforms, Padmanabhan said audience growth alone will not unlock advertising. “We all know it’s not enough to get audience,” he said, adding platforms need to “empower those audiences with enough technology” and “build those connectors” so brands can run meaningful trials.

On creator-driven commerce, he said creators are becoming “the new affiliates” across platforms such as Flipkart, Amazon, Myntra and Nykaa, and said they are working on performance-driven models. 

He said creator-driven or affiliate-driven commerce sales are growing at more than double digits, even if it is not always tracked and called out that way.

On creator strategy, he said, “Celebrities brought mega reach.” He said brands are now working with influencers more deeply and consistently to drive business results, with credibility coming from daily content in specific niches and regions. He cited the example of niche food creators and mentioned “Kavita’s Kitchen” as an example of a creator building a brand, adding that regional trust is a key reason brands are leaning into creator partnerships.

Adex-to-GDP headroom

Padmanabhan also framed long-term headroom through adex-to-GDP. He said India is at about 0.5% of GDP and argued the next inflection could come when per capita GDP reaches $4,000 from about $2,800. He cited the UK at about 1.5%, the US at about 1.4%, and China at about 1.1 per cent, and said India has room to grow advertising penetration.