Digital advertising to grow rapidly in India – mobile to account for 10.2% of total media expenditure by 2020


Source KPMG India

Digital is now one of the fastest growing areas of the India advertising industry. Despite still being a relatively small segment, digital ad expenditure accounted for 12.7% of total ad spending in 2016. It is expected to increase at a CAGR of 33.% between 2015 to 2020 with search and display formats leading the field.
That’s according to the Digital – The New Normal of Marketing report from the Confederation of Indian Industry (CII) and KPMG India.
Globally, India’s growth is estimated to have reached 15.5% in 2016.
As consumers in the country are catching up to new technologies such as wearables, tech innovators and marketers will have to ensure they are ready to deliver relevant and device-specific content.
Thomas Varghese, Chairman, CII National Committee on Marketing and CEO-Textile Business, Aditya Birla Group, explains:

“The post-demonetisation days have clearly showed how the country is set to leapfrog a few stages to embrace the power of digital. Mobile is being rapidly adopted and marketers have an incredible opportunity to enhance the game of digital communication and deliver great customer experiences at each point of the journey.”

eMarketer estimates that advertisers in the country will be spending around $7.41 billion for paid media placements. The research firm predicts that digital is going to surpass the $1 billion mark this year and amount to 14.3% of outlays.
Mobile advertising spend is going to increase steadily over the next three years to 2020 and make up 10.2% of total media expenditure.

Source eMarketer

Rachna Nath, Partner and Head, Digital Consulting, KPMG in India, adds:

“Singularity, connected systems, cognitive and AI will create a world where the marketer will be marketing not only to humans but the ‘self-thinking’ machines.”

The KPMG report also found that native ads are now being employed to combat ad blockers on mobile and desktop. Due to their non-invasive nature, content can be delivered without disrupting the consumer experience.
In addition, authenticity of campaigns, their relevance and value to the consumer are of growing importance these days. Given the short attention spam of the digital generation, marketers will have to condense their video messages into more compact versions to achieve maximum impact.
That said, curation and user reviews can be effectively employed to reach new audiences.
The report concludes with programmatic advertising, which it says will soon play a larger role in the country’s ad ecosystem.

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