By afaqs! news bureau Published: 5 Dec 2022, 11:50 IST
India ad revenue to grow 16.8 percent in 2023: GroupM report
Digital advertising will hold the maximum share of ad revenues.
GroupM has released its 'This Year Next Year 2022 Global End of Year Forecast' global market forecast. The report is a follow-up to the company's previously released data that came out in June. As per that data, global advertising revenues would see a decline - from an 8.4% growth rate in 2022 to 5.9% in 2023. "We now expect global advertising to grow 5.9% in 2023, behind the IMF's expectation for global inflation of 6.5% and a downgrade from our 6.4% June estimate," the report said.
GroupM placed India among its top 10 markets globally. The country's economic outlook appears to be stronger, relative to other markets, with the International Monetary Fund projecting real GDP growth of 6.8% in 2022, positioning it as one of the fastest-growing economies in the world.
"Against this backdrop, our advertising revenue growth forecast for [India] 2022 is 15.8%, with that figure further accelerating to 16.8% in 2023," the report says. The total revenues generated by the ad industry is expected to touch $14.9 billion in 2022.
As for the channel share in the Indian market, digital advertising will hold the largest share of about 48.8% and is expected to continue to rise above pre-COVID levels. This is followed by TV advertising, which continues to hold a dominant 36% share. This is expected to grow 10.8% this year and continue growing double digits, driven by strong growth in both traditional and connected TV.
The report also points out the stark rise in the prominence of retail media, which basically refers to placing ads on a retailer's network. Retail media in India will touch $551 million in 2022 and is expected to nearly double by 2027.
Even though India's ad growth is expected to accelerate this year, GroupM projects that the global ad share will only witness a nominal increase.
"We are projecting nominal global advertising revenue growth in 2022 of 6.5%, a significant deceleration from the 24.4% growth observed last year and a downgrade from our June forecast of 8.4% growth," the report said. Global digital advertising is forecast to grow by 9.3% in 2022, which is lower than GroupM's June forecast of 11.5%.
"This growth comes off the back of 31.9% growth in 2021 and brings the overall share of digital advertising (not including spending by advertisers on digital extensions of traditional media) to 67% of the industry total this year. We expect that share to rise to 73% by 2027," the report adds.
As is the case for India, retail media is also projected to be the fastest-growing segment of the advertising industry globally. The segment is estimated to reach $110.7 billion in 2022.
Outside of retail media, the report predicts digital revenue, including search, video and display, to decelerate from double-digit growth to mid-single-digit growth over the next five years, as the channel reaches maturity in more markets.
"TikTok is likely to roughly double its revenues in 2022. This has likely been another driver of the advertising deceleration or 'pullback' noted at Meta and Snap, for example, over and above macroeconomic factors," the report highlights.
Television continues its recovery to pre-pandemic levels, albeit more slowly in 2022, with an expected global growth rate of 1.7% .
After a brief respite in 2021, the report also highlights that traditional print continues its decline of 7.4% in 2022. "Print-based media will decline by 3.7% when including digital extensions, which are forecast to make up nearly half of total revenue this year and more than three-quarters of revenue by 2026," it said.