India's Digital Ad Spend To Surge To $21 Bn By 2028: Redseer At $21 billion, digital ad spending will account for 65-70 per cent of overall ad spend in India in FY28
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A new report by Redseer Strategy Consultants estimates digital ad spend in India to rise to 2.5 times its present size in the next five years to $21 billion, growing at a CAGR of 19 to 21 per cent.
In the last decade, India's advertisement industry has grown significantly, particularly on account of the covid-led accelerated digitization. The significant surge in the usage of smartphones and internet services has opened many doors for digital advertising.
"Upon mapping market sizing across media agencies, we observe a significant under-reporting of digital ad spend in India. However, Redseer projection has considered enterprise spends, SMB spends, influencer marketing, affiliate marketing and gaming," says Mukesh Kumar, engagement manager, Redseer Strategy Consultants.
Notably, growth in UGC will empower individual creators and influencers to build their digital identity, which brands can leverage for digital ads; this strong ecosystem of around 2.5 to 3 million creators is expected to drive marketing spending of $2.8 billion to $3.5 billion by 2028, the report added.
Global slowdown due to increasing interest rates, energy crisis etc. has led to new-age companies focusing on profitability and controlling their spending on ad and hence slower growth is expected in FY23. Under the current economic headwinds, the ad market is estimated to grow by six to eight per cent in FY23, noted the report, adding, macroeconomic engines are likely to pick up momentum again by FY24 since.
"The Indian digital economy has over 2.5 to 3 million sizeable content creators who have emerged into four archetypes: micro, macro, mega, and elite creators. The micro/macro influencers have given better ROI to bigger brands and enabled smaller D2C brands. It is projected that influencer-led live commerce in India will grow to $8 billion by 2030, and marketing spending on influencers will grow to $3.5 billion by 2028," stated the report.
As digital platforms allow marketers to reach out to target groups across various categories, many small and midsize businesses (SMBs) have opted for digital advertising owing to its democratized access. Digital enablers such as ePayments, eDiscovery, and eCommerce have enabled traders, service providers, Kirana owners, and small shopkeepers to have an online presence. As per Redseer, SMBs are expected to increase their share to around 40 per cent of the total digital ads expenditure by FY28.
