Tanushree Basuroy
Research expert covering India
Digital advertising in India - statistics & facts
While advertising in India is already a billion-dollar-industry, the digital advertising segment under its umbrella has emerged as one of the fastest growing in the world. Having surpassed the two dominating traditional media, that is television and print, digital accounted for nearly half of the overall revenue earned within the Indian ad market. Given India's vast digital population and rapidly expanding digital media market, this was a development that was inevitable.
The Indian consumer's unquenchable thirst for online video entertainment gave rise to other platforms for digital ads to branch out to, such as short-form video (SFV) apps, live commerce, and video commerce. The latter was a feature developed and introduced on e-commerce platforms, a sector that is a major contributor to digital ad spends. Yet another trend that is here to stay is influencer advertising and marketing. Brands increasingly rely on content creators to connect with diverse audiences, while the latter is dependent on brand deals to earn revenue.
Drivers of digital advertising
With the increasing use of smartphones and users being connected to the internet at all times, Indian advertisers' ability to reach targeted audiences has been amplified. Social media usage in the country has provided a key avenue for digital advertising, with the format accounting for almost a third of digital ad spends. The social media advertising spends in India amounted to over a billion U.S. dollars as of 2022. YouTube followed by Meta platforms, Facebook and Instagram, had the widest ad reach as of 2023.The Indian consumer's unquenchable thirst for online video entertainment gave rise to other platforms for digital ads to branch out to, such as short-form video (SFV) apps, live commerce, and video commerce. The latter was a feature developed and introduced on e-commerce platforms, a sector that is a major contributor to digital ad spends. Yet another trend that is here to stay is influencer advertising and marketing. Brands increasingly rely on content creators to connect with diverse audiences, while the latter is dependent on brand deals to earn revenue.
Push for programmatic
Despite these advancements, India remained in the nascent stages of digital advertising in one aspect - programmatic media buying. Programmatic advertising uses a software or algorithms to purchase ad inventories instead of the traditional route of human negotiations usually involving ad agencies. More than half of all digital media ads in India continues to be bought through direct manual channels. However the gap between programmatic and direct advertising in India has slowly been closing. ChatGPT's rise to the limelight has propelled the adoption of AI tools and technology across various sectors around the world. The trend can be expected to inspire AI-assisted advertising and marketing in India too. Additionally, improvements in audience analytics, along with a better focus on ad fraud detection and data privacy is the need of the hour in order to fully integrate digital advertising as a valuable element in the country’s advertising pie.
