Media Spending in India Up 20 Percent

Advertising spending in India is on a roll.

A new GroupM study predicts that advertising expenditures in all media throughout India will increase 20 percent in 2008 to $5.6 billion and 19 percent in 2009 to $6.6 billion. The projected hikes follow a 20 percent increase in 2007.

The report, “This Year, Next Year: India Media Forecasts” is part of GroupM’s annual media and marketing forecasting series drawn from data supplied by holding company WPP’s worldwide resources in advertising, public relations, market research, and specialist communications. It includes forecasts for advertising spending in all major media.

“India is clearly set to deliver sustained long-term advertising growth,” said London-based GroupM Futures Director Adam Smith, who oversees all “This Year, Next Year” reports. “It is also one of the world’s most under-advertised countries since measured advertising investment accounts for only one-half percent of GDP, compared to a global norm of around one percent.”

The study predicted that in 2009 India will become the 15th largest advertising market worldwide, rising to that spot from 26th place in 2000. Globally, measured advertising investment has grown by almost 50 percent since that time, rising to a projected $496 billion in 2008 compared to $333 billion in 2000. In the same time period, ad expenditures in India have nearly quadrupled, from $1.5 billion to this year’s projected $5.6 billion.

GroupM expects global ad investment to rise 5.8 percent in 2008 (to $496 billion) and 4.5 percent in 2009 (to $518 billion). With slow-to-no growth in the developed world, India will be contributing one in 20 of all new ad dollars expected in 2009, making it the third largest developing ad economy in the world behind China (one dollar in three) and Russia (one in 10).

The study noted that most of the growth has been driven by spending in traditional media since internet ad spending has been comparatively slow. India’s internet penetration was relatively low at 46 million monthly users at the end of 2007, or four percent of the population. In 2008, GroupM expects internet ad spending to account for only 2.6 percent of India’s measured advertising investment. However, Smith said India’s internet use will accelerate as the quality, quantity, and search capabilities of local content improve. He added that rising internet use in rural areas already accounts for 20 percent of total usage, representing good progress.

A copy of the full This Year Next Year: India 2008 report is available to the media on request.

About GroupM
GroupM is the leading global media investment management operation. It serves as the parent company to WPP media agencies including MAXUS, MediaCom, Mediaedge:cia and MindShare. Our primary purpose is to maximize the performance of WPP’s media communications agencies on behalf of our clients, our shareholders and our people by operating as a parent and collaborator in performance-enhancing activities such as trading, content creation, sports, digital, finance, proprietary tool development and other business-critical capabilities. The agencies that comprise GroupM are all global operations in their own right with leading market positions. The focus of GroupM is the intelligent application of physical and intellectual scale to benefit trading, innovation and new communication services, to bring competitive advantage to our clients and our companies.

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