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The year could end on a positive note for the Rs 38,000-crore advertising sector if estimates of the December quarter performance are anything to go by.
The country's top media agency professionals, who decide where advertiser money should be parked, said growth for the three months ended December would be 10-15 per cent, led by categories such as e-commerce, which spent heavily on advertising in October.
"Elections in Haryana and Maharashtra also propped up growth for the month," Anupriya Acharya, chief executive officer, ZenithOptimedia Group, India, said. "The trend for the rest of the quarter is that e-commerce will continue to be a big driver, like it has been throughout the year."
At a time when traditional big spenders such as fast-moving consumer goods, electronics and telecom slowed on account of inflationary pressures and lower consumer spending, e-commerce was the only saving grace, said P M Balakrishna, chief operating officer (COO), Allied Media, part of the Percept Group. "This and elections were the only highpoints this year and my estimate is that the year will close on a par with what it did last year."
Last year, the sector had closed at growth levels of 10-11 per cent, which is what is estimated this year by both Acharya and Balakrishna.
The country's largest media agency network, GroupM, part of the WPP Group, is even more positive in its outlook for the year, revising its advertising growth forecast from 11.6 per cent to 12.5 per cent recently. Rival Madison, which also releases its annual forecast for the year, is even more optimistic, predicting nearly 17 per cent growth for 2014.
Karthik Lakshminarayan, COO, Madison Media, said his agency's assessment of ad revenue growth this year was based on the positive sentiment among advertisers, notably e-tailers, and events such as elections. "Overall performance this year will be better than last year," he said.
GroupM had revised its forecast on account of heavy spending by e-tailers, handset makers and political parties. While categories such as durables, retail, automobiles and real estate did come into the picture in the second half of 2014 on account of the festive season, GroupM executives said it was really the above three that called the shots through the festive season.
In October alone, e-commerce, which as an advertising category today stands at Rs 1,000 crore, brought in an estimated Rs 200 crore in ad spends. October this year was unique because Dussehra and Diwali fell in the same month.
Among the media vehicles that gained from this surge in advertising were print, television and digital, with e-tailers taking a 360-degree approach, Balakrishna of Allied Media said.
AD SURGE
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Advertising growth for the December quarter is estimated at 10-15 per cent, led by e-commerce, handset makers and political parties
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E-commerce alone brought Rs 200 crore in advertising spend in October, remarkable for a category which did not have a big presence last year
