India's Ad Market Surges with Digital Dominance

India's advertising market has witnessed a notable surge in recent years, recording a compound annual growth rate of 6-7 percent over the last five fiscal years to surpass the Rs 1 lakh crore threshold in the fiscal year 2024-25, as per Crisil Ratings.

A Crisil report highlights that digital advertising has emerged as the most rapidly expanding segment, now accounting for 45-46 percent of total ad expenditures, a significant increase from the 24 percent recorded in fiscal 2020. In contrast, traditional media growth has stagnated, marking a shift in consumer content consumption patterns.

By fiscal 2020, television and print media constituted around 65 percent of the market share, which declined to 46-47 percent last fiscal year. The television sector is pressured by the rise of over-the-top platforms and upgrading distribution networks. Similarly, the print industry struggles with declining circulation, a preference for digital news, and shifting advertiser interest in digital platforms.

Pushan Sharma, Director at Crisil Intelligence, pointed out that this change is reflected in how consumer-centric sectors, such as FMCG, automobiles, and e-commerce, allocate their ad budgets. Notably, FMCG enterprises increased their digital spend to 55-60 percent, compared to 30 percent in fiscal 2020. Brands are increasingly favoring digital-first strategies due to its targeted approach and cost efficiency, which continues to reshape India's advertising landscape.

(With inputs from agencies.)