Media agencies GroupM and Zenith on Monday said India would be among the top advertising markets in the world next year despite weak domestic economy. WPP-owned GroupM projected a 12-13 per cent growth rate for the local advertising market in 2020, in line with 2019, taking its overall size to nearly Rs 95,000 crore.
Zenith, on the other hand, said India would be among the top 10 global ad markets amid challenges faced by the economy. “India is currently witnessing headwinds, with a gross domestic production (GDP) slowdown over seven quarters. While the short-term view is cautious, the longer term optimism remains,” said Tanmay Mohanty, chief executive officer, Zenith India and head of global partnerships, Publicis Media India.
In the past few months, the government has slashed corporate tax rates, announced a stimulus package for the real estate sector, and injected liquidity into the banking system to get the economy back on track. The effort has hardly yielded any results for now, with the economy slowing to a six-year-low of 4.5 per cent in July-September.
On Monday, brokerage Credit Suisse said that the second half of the financial year ended March 2020 would see even more challenges for the market, especially the fast-moving consumer goods (FMCG) sector, among the leading advertising categories in the country, as rural demand remained weak.
Market research agency Nielsen has already predicted a low single-digit FMCG growth rate in the October-December period from mid-single digits in July-September. Prashanth Kumar, chief executive officer, GroupM South Asia, admitted that pain remained in the market. “In 2020, India faces uncertainties across sectors. However, this brings opportunities for brands to innovate. This will be propelled by greater use of technology and better content across media,” he said.
According to GroupM, the internet or digital advertising medium would see the sharpest rate of growth in 2020 at 26.3 per cent, followed by television at 11.1 per cent and outdoor and radio at 8 per cent each. Digital advertising’s share in the total ad pie, GroupM said, would touch nearly 30 per cent in 2020, second only to television’s share, which would be 42.5 per cent. Print’s share in the total ad pie would be 19.3 per cent.