Madison Report: Growing At 12%, Indian Adex Likely To Touch Rs 1.11 Lakh Crore In 2024

As part of its annual tradition, Madison Media has launched the 11th edition of its report which mentions the agency’s predictions for the advertising industry in 2024. This year, the agency has forecasted that the Indian Adex, growing at 12%, is likely to touch Rs 1.11 Lakh Crore in 2024.

According to Madison’s report, in 2023, the total Adex grew by a mere 10% in India as opposed to the agency’s projection of the same being 16%. Of this, it was the traditional adex which grew by 7% and digital adex which soared up 15%.

While it is traditional adex which dominated Indian Adex with a 60% share, its contribution to the global adex is only 27%.

Digital Medium is the largest contributor to the Indian adex with a 40% share and has gained 2% points in terms of share, still trailing behind Global Adex, where its share is 73%.

That being said, the year 2023 saw Digital medium growing modestly at 15%, followed by Outdoor at 13% and TV and Print by 7% and 4%, respectively.

In fact, in 2023, the Audio Visual medium, as per Madison, contributed to 46.3% of the total Adex with Linear TV at Rs. 32,886 crores and Digital Video at Rs. 12,996 crores, collectively summing up to Rs 45,882 crores.

Moreover, as compared to H1 of 2023 wherein the adex grew by just 6%, the latter half saw a 14% spike as Q4, standalone, was the best performing quarter with a contribution of 31% to the full year and accounted for 50% of the annual growth.

According to Madison Media, the increase in raw material prices in H1, continuing wars in Russia-Ukraine and Israel-Hamas accompanied by inflation and funding winter within the start-up industry were some of the factors that contributed to the slow growth rate of the Indian adex.

“Whilst the GDP growth is estimated at 7.3%, if you look deeper, the contribution of private final consumption expenditure component of GDP has come down, which may explain the reason for lower buying of products and services by the middle class ans rural India,” the report mentions.

When it comes to categories, the FMCG sector continues to be the largest contributor in the Indian adex as per the report and has gained a share of 1% point to 33% in 2023. Following this is the Ecommerce category which has established itself as the 2nd biggest contributor to Adex, with a share of 11% in 2023.

And even though there is no change in the Top three Advertisers of Adex- HUL, Reckitt and RIL, Godrej Consumer Products is the new entrant in the Top 5 list as it has moved up the rung from rank 12 to 5.

“The Top 50 Advertisers list has 20 FMCG companies and only 1 Start-up in the list, compared to 9 last year, reconfirming the funding winter in the start-up eco system. Whilst total Adex has grown by 10%, if we look at the Top 10 advertisers, their advertising budgets have grown 20%,” the report added.

The report also pointed out that even though Video, Social, Display, Ecommerce and Search drive Digital Adex, Digital Video continues to dominate the Digital Adex despite its growth slowing down from 40% last year to 26% in 2023. Moreover, advertising on Connected TV has increased from Rs 450 crores to around Rs. 1,000 crores in 2023.

Registering a modest growth of 7%, against Madison’s forecast of 9% to reach Rs 32,886 crores in 2023, TV’s Share of Adex has declined from 34% in 2022 to 33% in 2023. with this, there has also been a 2% drop in advertising FCT in 2023 over 2022.

“Not only does FMCG continue to be the largest contributor to TV Adex, with a growth in spends of 12%, its contribution to TV Adex increased from 45% to 47%. Ecommerce continues to be the 2nd largest contributor to TV Adex. Auto has increased spends by 21% and contributes to 6% of TV Adex. Education as a category has reduced its spends by 41% and now contributes just 2% to TV Adex,” the report elaborates.

That being said, the agency predicts TV Adex to grow by 8% in 2024 to reach a total of Rs 35,575 crores with a share of 32%.

On the other hand, Print has also grown by 4% to reach Rs. 19,250 crores, but is still below its pre-Covid level. And, while its share to total adex has dropped by 2% points from 21% to 19%, it is still far higher than the Global average of 4% as per the report.

“Auto, FMCG, Education, Retail and Real Estate contribute 50% to Print Adex. This year Auto is the leader of the pack with 14% Share and contributed most to the growth of Print Adex. Also, Hindi and English Publications contribute over 64% to the total Print Advertising space consumed in India. Marathi comes next. But the volume of space used collectively in Kannada, Tamil, Telugu, Malayalam, Gujarati, Oriya. Bengali, Punjabi, Assamese and Urdu is relatively low,” the report highlighted.

As per Madison’s report, Print is expected to grow by 7% in 2024 to reach Rs. 20,613 crores and finally surpass the pre-Covid 2019 figures.

Similarly, the report also pointed out that OOH Adex registered a growth of 13%, on the back of a 68% growth the previous year, taking the industry to Rs 4,140 crores; Radio Adex grew by 12% to reach Rs 2,272 crore to finally surpass its pre Covid level.

“Real Estate has emerged as the largest category in both OOH and Radio, pipping FMCG,” the report stated.

Lastly, the report also highlighted that Cinema registered the highest growth of 36%, to reach Rs 776 crores in 2023, but has yet not reached its pre-Covid levels despite its share going up marginally from 0.60% to 0.80%.

Sharing the highlights of the report, Sam Balsara, Chairman, Madison World, said,

“Whilst the Outlook for Adex in India is extremely strong in the mid-term and long-term, in the short term we are witnessing a slowdown in momentum because of India Inc’s focus on quarterly profits. This does not augur well for sustained growth in profits for Advertisers who should be focusing on volume growth.”