Post on 18-Nov-2014
description
INDIAN INDIAN
ADVERTISING ADVERTISING
INDUSTRY : INDUSTRY :
TUSSLING IN TUSSLING IN
THE GLOBAL THE GLOBAL
MARKETMARKET
Made by:Roshni Patel
D 15BBA general3rd semester
INDEXINDEX Acknowledgement
Introduction
Analysis
The Trend
Analyzing the Global Advertising Industry
Indian ad industry attracting overseas attention
Indian Ad Agencies Finding Feet Abroad
PINSTORM
COMPANY PROFILE APPROACH & SERVICES THE TEAM MORE ABOUT PINSTORM PINSTORM CLIENTS
Lintas & Pinstorm tie up for Digital Facts & Figures: Indian Advertising Industry
Advertising
TELEVISION FILMED ENTERTAINMENT PRINT MEDIA RADIO MUSIC LIVE ENTERTAINMENT OUT OF HOME ADVERTISIMENT INTERNET
CONCLUSION
REFRENCES
Indian advertisin
g industry:
An Introducti
on
The Indian advertising industry is talking business today. It has evolved from being a small-scale business to a full-fledged industry. It has emerged as one of the major industries and tertiary sectors and has broadened its horizons be it the creative aspect, the capital employed or the number of personnel involved. Indian advertising industry in very little time has carved a niche for itself and placed itself on the global map.
Indian advertising industry with an estimated value of es13, 200-crore has made jaws drop and set eyeballs gazing with some astonishing pieces of work that it has given in the recent past. The creative minds that the Indian advertising industry incorporates have come up with some mind-boggling concepts and work that can be termed as masterpieces in the field of advertising.
Advertising agencies in the country too have taken a leap. They have come a long way from being small and medium sized industries to becoming well known brands in the business. Mudra, Ogilvy and Mathew (O&M), McCann Ericsonn, Rediffussion, Leo Burnett are some of the top agencies of the country.
Indian economy is on a boom and the market is on a continuous trail of expansion. With the market gaining grounds Indian advertising has every reason to celebrate. Businesses are looking up to advertising as a tool to cash in on lucrative business opportunities. Growth in business has lead to a consecutive boom in the advertising industry as well.
The Indian advertising today handles both national and international projects. This is primarily because of the reason that the industry offers a host of functions to its clients that include everything from start to finish that include client servicing, media planning, media buying, creative conceptualization,
pre and post campaign analysis, market research, marketing, branding, and public relation services.
Keeping in mind the current pace at which the Indian advertising industry is moving the industry is expected to witness a major boom in the times ahead. If the experts are to be believed then the industry in the coming times will form a major contribution to the GDP. With al this there is definitely no looking back for the Indian advertising industry that is all set to win accolades from the world over.
Indian advertisin
g industry:
An analysis
This report starts with a historical overview of the Indian advertising industry and examines how advertising spends have undergone a change over the years. It looks at the trends and key drivers and their impact on the industry. A summary of the issues faced by the advertising industry has also been included. The report conducts a detailed external and internal study of the Indian advertising industry within the PEST and Porter frameworks.
It also studies the competitive landscape including the top three agencies- JWT, O&M, and Lowe’s. Since the agencies are not listed and do not disclose their financial
information, the report has alternatively covered a summary of their operations and competitive strategies. The report concludes with an outlook on the industry.
The Indian advertising industry has been evolving at a fast pace over the past few years owing to an increase in the forms of media and communication and the emergence of new distribution channels. Currently India has a low advertising spend to GDP’ ratio as compared to other economies. Competition
for the outsourcing business and creativity leakage represent the major issues and implications. However, the television advertising is expected to register high rates of growth, with India expected to become Asia's leading cable market by 2010.
Executive SummaryThe Indian advertising industry is being reshaped by regulatory and technological changes spanning various media platforms- radio, TV, internet, print, and outdoor.
Deregulation involving FM radio, Direct-to-Home (DTH), broadband, the implementation of the conditional access system (CAS), and foreign direct investment has laid the foundation for faster growth of the advertising industry. Stricter norms on social responsibility, obscenity, and ethics are altering the industry practices.
The industry is dominated by ten agencies, who account for the majority of capitalized billings. Top 10-15 advertisers with the biggest ad spend (like HLL, Maruti, Hero Honda, Pepsico) wield high
bargaining power and their account movement from one agency to another alters the competitive dynamics.
Table of Contents:
1. Introduction
1.1 Industry DefinitionThe Indian advertising industry comprises
establishments that create and sell advertisements for media such as newspapers, periodicals, radio, and
television.
1.2 Industry SegmentsSigns and Advertising Displays
Advertising AgenciesOutdoor Advertising Services
Radio, Television, and Publishers' Advertising Representatives
Advertising Not Classified Elsewhere, Direct Mailadvertising Services
2. Market Dynamics
2.1 Market OverviewIndian advertising industry is being driven by rising
consumerism and the entry of global brands. In 2005, the industry experienced a growth of 10%.
2.2 Trend AnalysisIncreasing Popularity of Online Advertising
Shift towards a Fee-Based SystemGrowth in Out-of-Home Advertising
2.3 Key DriversPenetration of Delivery Platforms Rising
Increased Broadband AccessMobile Advertising
2.4 Major Issues and ImplicationsCompetition for the Outsourcing Business
Creativity Leakage
3. PEST Analysis
3.1 Political FactorsReview of Advertising Code
Ban on Surrogate Advertising Hitting Advertising RevenuesCAS Implementation Altering Viewership DistributionDirect-To-Home Growth Spurring Niche ProgrammingFM Radio Deregulation Increasing Media Penetration
3.2 Economic FactorsOpportunities from Rural Income Growth
GDP Growth Fuelling Advertisement Spends
3.3 Social FactorsTweens Emerge as Influential Consumer
Non-Metro India Influencing Advertising Strategies
3.4 Technological FactorsDigital and Graphic Innovation in Outdoor Advertising
Animation Industry Driving CreativityINSAT-4A Launch
Internet Penetration Driving Online Advertising
4. Michael Porter’s Five Force Analysis
4.1 Buyer PowerIncreased Bargaining Power of Buyers
Big Accounts Rule Over Agencies
4.2 Supplier PowerShortage of Creative Talent
Mushrooming TV Channels Advantageous for Agencies
4.3 Intensity of CompetitionConcentrated Market with MNC’s Leading the Industry
Advertising Players Setting up Second AgenciesRush for Neighboring Markets
4.4 Threat of New EntrantsDominance of Top Agencies
India Gaining Popularity as an Emerging Market
4.5 Threat of Substitute ProductsDirect Marketing
5. Competitive LandscapeOgilvy and Mather
LoweJWT
5.1 Competitive PositioningPresence in Cities across India
Capitalize BillingCreative Successes
Loss of Major AccountKey People
5.2 Competitive StrategiesO&M
• Sets up Digital Media Network Firm• Consolidates Out-of-Home Businesses
Lowe• Offers Brand Marketing Consulting
JWT• Targets Airlines, Financial Services and Telecom
• Repositions Fortune as a Full Service Agency
5.3 Operation Analysis
5.3.1 Client BaseO&M-Asian Paints, CastrolLowe- Pepsodent, Close Up
JWT-Pepsi, DeBeers
5.3.2 Major AccountsO&M-Hutch: You and I, Fevicol: Building Bonds
Lowe India- Surf Excel: Stains are Good, Axe: The Axe EffectJWT-Pepsi “Yeh Dil Maange More”, Lux: Beauty Soap for Film
Stars
5.4 Key DevelopmentsO&M –O&M Launches Meridian, Ogilvy Worldwide
Outsourcing Work to IndiaLowe India - Wins LG Account, Lowe loses Liril to McCann
JWT- JWT bags Hero Honda Super Splendor, JWT loses Kentucky Fried Chicken
6. Industry OutlookIndian advertising industry is forecast to grow at the rate of 12-15% in
2006.
Indian Advertisin
g Industry:
The Trend
The Indian advertising spends, as a percentage of GDP, is 0.34%, which lags behind other developed and developing countries.
During fiscal 2005, the gross advertising spend in India is estimated at Rs 111 billion, and is expected to grow at
14.2% to reach Rs. 127 billion by fiscal 2006.
The key factors which have contributed to growth of the Indian advertising industry
include:
Rapid economic growth of the country on the back of economic liberalization and deregulation
Increase in consumer prosperity
Entry of global consumer companies with large advertising budgets
Higher degree of competitive intensity among consumer companies; and
Growth in media vehicles leading to increase in media penetration
Segmentation of Advertising Spends
The five key industry segments comprise print, television, radio, cinema, and outdoor. These
different segments within the industry are at varying stages of growth and corporatization.
Media Spends as % of Total Ad SpendYear Print TV Radio Cinema Outdoo
rInternet
2000 49.0% 39.3% 2.5% 0.5% 8.4% 0.3%2001 48.4% 40.6% 2.7% 0.4% 7.5% 0.4%2002 47.2% 41.9% 2.9% 0.7% 7.0% 0.4%2003 46.6% 43.0% 2.9% 0.7% 6.5% 0.4%2004 46.3% 43.7% 2.9% 0.6% 6.0% 0.3%
The Indian television industry has grown rapidly, especially since 1991, which saw the beginning of satellite broadcasting in India. This growth was also aided by the economic liberalization program of the Government. The growth of the satellite television
audience saw proliferation of a number of satellite television channels offering more choices to media buyers and consumers of entertainment. Thus, the television broadcasting business, which started off as a single government controlled television channel, now has over 300 channels covering the Indian footprint, resulting in growing ad spends on this medium. Reforms and proliferation of private players were the key reasons for this rapid growth of the share of television in the advertising industry.
Similarly, sectoral reforms and increased number of players could drive market expansion for emerging media segments including radio, outdoor, cinema and internet.
Analyzing the Global
Advertising Industry
The global advertising industry is showing definite signs of a recovery, after one of the worst-ever slumps in advertising. Media-buying firms, TV
broadcasters and radio and billboard companies are making positive noises about the future. Print
advertising looks more promising and several US magazines saw ad pages increase quite dramatically.
The future of the ad industry is not in doubt - things will get better, but only companies that have
positioned themselves correctly will be able to capitalize on the upswing. To do this, many firms are looking toward technology as the point of departure for huge returns. The convergence of the Internet
with television, the growth of wireless communication, and the increasing use of digital
video recorders all offer new avenues and challenges for advertisers. Further consolidation across national
borders is also expected as ad firms try to deliver global capabilities in an increasingly competitive
market.
Aruvian Research’s report on Analyzing the Global Advertising Industry thoroughly explains the global
advertising industry by establishing a clear demarcation of the industry components and the top
spenders as well as the service providers in the global context. This helps the reader understand the
industry in a nutshell overlooking the competitive activity in the industry.
The report also builds a geographical mapping of the major advertising markets worldwide namely the United Kingdom, France, Germany, China, Japan,
Canada, Spain, The Netherlands, Italy, Belgium and the United States. In this section, the report explains each of these markets in detail with their commercial
characteristics along with the major players which are active in these markets thereby drawing up the
overall business picture for advertising in these markets.
Indian ad industry
attracting overseas attention
The Indian advertising industry is increasingly attracting the attention of many American companies and communication agencies, opening up business avenues for the small and medium marketing agencies in India.
Worldwide Partners Inc, the ninth largest global network of more than 90 marketing and communications agencies in about 50 countries, recently tied up with Indian Pressman
Advertising & Marketing Ltd following repeated enquiries about India.
“In the last year, we got the most number of enquiries for India and its advertising scenario from America, followed by enquiries from West Asia and some from Europe,” said Ms Lisa Kettman-Kervinen, Director, Worldwide Partners Inc, on a recent visit to India.
Most of the enquiries were in the nature of harnessing online solutions like logo designs, computer science graphics and outsourcing of other digital solutions. India already has a reputation for computer skills due to the digital education in India and so more and more clients are waking up to the fact that there is good business possibility here.
Before Pressman came on board as a full partner in December 2007, Worldwide partnered Image Ads for some years, before the company decided to sell part of their agency and sold shares back to the network.
Today, ‘Worldwide’ has two partners in India, with Images being an associate partner. Each partner is a shareholder in the network.
Currently, Worldwide is focusing on strengthening its position in India and Korea specifically and Asia Pacific largely, to get more partners and directors on board, she said. The network is scouting for a director based out of Singapore for the purpose.
The network has a fairly established presence in the rest of Asia with offices in China, Japan, Malaysia and Australia.
For Pressman, which handles clients such as Bata India, BlueStar, Mudra Lifestyle and LIC, it is a good opportunity to connect with agencies from across the world in Worldwide’s network.
“The network is like a well where we can dip for some more water as and when we require,” said Dr Niren Suchanti, Chairman and Chief Executive Officer, Pressman. “It is a very active network where we have already received 60 enquiries in a week. As all members do business independently, we can negotiate and agree on some small fee to use the expertise of the other agency, including exchanging creatives for specific campaigns.”
THE ECONOMIC TIMES:
Indian Ad Agencies
Finding Feet Abroad
Perhaps for the first time, the Indian ad agency flag is being hoisted on foreign soil. The dream of a
traditional, brick-n-mortar Indian ad agency (yes, majority-owned by Indians, not Indian arm of a global
agency network), of going global is finally being realized, albeit by a host of new generation agencies
that focus on the digital and mobile space.
Search engine marketing firm Pinstorm, set up by Mahesh Murthy, is foraying
beyond Indian, Malaysia and Singapore to set up offices in
China, US, UK and Sweden and Australia by next year.
Internet promotions company, Webchutney, is expanding in the South-East Asian region, specifically Malaysia and
Singapore by next month. Mobile marketing company, Mobile2win (owned by
contest2win), set this trend by incorporating in Hong Kong (this operation has recently got bought over
Disney), even before it opened its Indian office in ‘03.
If internet knows no boundaries, why should ad agencies in this space have one, goes the logic with
most players here. Anyway, all these internet agencies already work for global clients, either
onshore such as mobile2win or outsourcing work offshore, much like Webchutney. Already, almost
two-third of online agencies revenues is coming from global clients.
“It is much easier to watch trends in media online. Making an ad online is far easier than doing it in
traditional media,” says Siddhartha Rao, CEO & co-founder, Webchutney.
“We started with a global dream, unlike the typical, traditional agency where you set up a local office and
then hire 40 people. We learnt the lessons from Infosys and Wipro and implemented it on ourselves,”
says Mahesh Murthy, CEO of search marketing company, Pinstorm.
And its not that their office footprint are getting global - they even call their creative teams as
‘delivery teams’. These agencies have dedicated delivery team a la software firms that work closely with the business development/servicing teams of clients who may be sitting anywhere, Sydney to
Stockholm.
No wonder interactive agencies are growing at a stupendous, over 400% per annum, and expect this
kind of growth to continue for the next couple of years. Asia-Pacific markets are rich picking grounds
for interactive agencies, owning to high internet penetration amongst consumers, coupled with a
paucity of interactive players.
“Setting up our base there has no real cost advantage to us. It is the hunger to explore and tap these markets that driving us there,”
adds Rao. Webchutney plans to
bring in big ticket venture capital
funding in the next six months to fund
its global expansion plans, with a strong base in West Asia.
The fear of being gobbled up by big global players it seems is no dampener to these players. “If we don’t turn out to be multinational, we at least would like to be a pan Asian,” adds webchutney’s Rao. This global-
local game is something that Alok Kejriwal, CEO, contest2win, has already worked out well.
Even though Disney has bought out the entire stake holding of Mobile2Win China, the Indian operations in Mobile2Win India remain independent. In fact Mobile
2Win India seems is still chasing the global run. It recently inked a deal with Freemantle (its partner for
Indian Idol) to work on Philippine Idol.
“Its time for interactive agencies such as ours to not let geography limit us. The resurgence of the internet
is just helping our global mindsets.”
COMPANY PROFILE
Type PrivateFounded 2004
Headquarters
Mumbai, Maharashtra, India
Key people
Mahesh Murthy, Founder & CEO
Ansoo Gupta, Global Head, Business
Industry Advertising
Services
Internet Marketing, Search Engine
Optimization, Search Engine Marketing
Employees 130Website www.pinstorm.com
Pinstorm is a pay-for-performance digital marketing firm. Pinstorm is based out of offices in Bombay - also known as Mumbai - and Delhi in India, along
with offices in Singapore, Malaysia, Europe and the United States. They service clients in North America,
Europe, Australia and Asia from these offices.
PAY-FOR-PERFORMANCE DIGITAL MARKETING
Pinstorm has been selected by Red Herring (magazine) to their list of Asia’s 100 hottest companies for 2008.
Pinstorm and Lintas Media Group have announced a
significant non-equity partnership. Designed to push clients to performance-driven media choices, the alliance
between the two leading firms in the offline and online worlds was
to put further pressure on traditional agencies and media
houses.
APPROACH & SERVICES
Pay-for-performance model: in this model clients don't pay for the creative or media costs. They pay only in proportion to the results delivered, through measurable brand visibility, or through measurable target group responses. Pinstorm has already done pay-for-performance campaigns for marketers like
Yahoo, HSBC, Standard Chartered, Jet Airways, Conde Nast and Canon.
THE TEAM
Mahesh Murthy, founder and CEO, has 24 years of marketing and communications experience – of
which over 14 years are in online marketing. While running digital marketing campaigns for a charity in late 2003, Mahesh saw an opportunity to change the
basic business model in advertising and set up Pinstorm with a bunch of great people to do so.
Ansoo Gupta is the Global Head, Business at Pinstorm. Having 14 years of experience across
marketing and advertising sales in print, online and television media across India and South East Asia. Prior to joining Pinstorm, Ansoo Gupta worked with
brands like The History Channel, National Geographic, Star TV, Channel V and First City
Magazine.
Pinstorm has a mix of Search Engine Marketing, Search Engine Optimization & Google Analytics Experts, Client Managers, Strategists, Creative
Minds, Programmers, and Global Support Staff in Finance, Information Systems, People Care and
Administration.
MORE ABOUT PINSTORM
Pinstorm turned 5 years old on May 1, 2009 and is based out of offices in Bombay - also known as
Mumbai - and Delhi in India, along with offices in Singapore, Malaysia and the United States. They
service clients in North America, Europe, Australia and Asia from
these offices.
Pinstorm sees enormous potential in search marketing –
understanding buyer demand by analyzing search patterns over time, topic and geography and
matching it to the offerings of our clients in real time, cost-effectively.
This has required the creation of a set of patent-pending technologies - from BroadWords® that lets them deploy campaigns wider and at lower cost than ever before, to BidWise® to help us bid more intelligently to GeoTrak® that points out geographical patterns in visitor and lead behaviour in real time. All available to brand owners in a pure pay-for-performance model - letting them share the risk and rewards like few other marketing firms do.
They deliver results with precise targeting for clients like American Express, Sun Microsystems, British
Airways, Qantas, Monster.com, Greenpeace and others.
PINSTORM CLIENTS
Banking, Financial Services
Education
Media
Non Profit/Industry
Organizations
OnlineServices
Recruitment
Retail &
E-commerce
Dealer Direct
Technology
Travel & Hospitality
Survey & Contests
Lintas and Pinstorm tie up for
Digital
Advertising
Pinstorm and Lintas Media Group have announced a significant non-equity partnership. Designed to push
clients to performance-driven media choices, the alliance between the two leading firms in the offline
and online worlds will put further pressure on traditional agencies and media houses. This move is
being seen in media circles as a positive step towards a more evolved phase in digital advertising.
Lynn de Souza of the Rs1, 800 crores Lintas Media Group said,
“We don’t think that just buying a digital agency will contribute to our client’s success. What attracted us
to Pinstorm was their pure adherence to pay-for-performance – a vastly different model to the
commission and retainer structures that Indian clients are used to. We think this model can go a
long way in bringing accountability and transparency to investments in advertising.”
The pay-for-performance model was pioneered by Google and Yahoo, and has been pushed further by Pinstorm, India’s only MNC digital ad firm, where the agency pays for the media and the creative – and the
advertisers just pays for results.
Mahesh Murthy, founder of Pinstorm said, “Around the world, media costs are going up and clients are cutting commissions and retainers because they are
unable to see how advertising is performing. At Pinstorm, we simply ask the client to pay for the prospects or results we deliver. Our alliance with
Lintas comes from our joint belief that the Rs16, 000 crores Indian
advertising industry needs a new model. By working together, pay-
for-performance advertising can be brought into the mainstream of
advertiser choices.”
The alliance estimates that they will be able to drive an incremental Rs100 crores of advertising to move
over from traditional models to a performance-driven model in the next 12 months. “Digital advertising accounted for just 4% of spend in India last year.
With this alliance and other efforts, investments in digital advertising will cross the Rs1, 000 crores mark, almost 100% growth over last year” said
Murthy.
“An industry only grows when there is pay-for-performance. For too long have clients worried that
their agencies and publishers are simply recommending higher media spends because that’s
how they earn more. That era will soon end. Our work with Pinstorm is to collaborate on clients to give
performance-driven options initially across digital media - but we hope over time to grow the same
basis to traditional media like broadcast, print and outdoor too” added de Souza.
The Lintas-Pinstorm alliance will first come into effect on Lintas’ roster of clients and soon expand to other businesses. Lintas Media Group is among the largest media agencies in India, managing a spend of over
Rs1,300 crores on broadcast, print, outdoor and other media for clients like Idea, Bajaj Auto, Maruti
Suzuki, ITC, Sony, UTI and Naukri.
Pinstorm is the largest independent digital advertising firm in South East Asia, with offices in
Bombay, Delhi, Singapore, Kuala Lumpur, Beijing and Santa Clara in Silicon Valley. It uses proprietary
technologies across search engine marketing (SEM) search optimization (SEO), email, SMS advertising,
online display advertising, online community creation
and blog management to handle the performance advertising needs of Yatra, Jet Airways, Taj Hotels,
Share khan and HSBC in India.The alliance is effective immediately and in place
across all advertisers in India.
Facts& Figures:Indian
Advertisi
ng Industry
Television
Current size: Rs 148 billion
Projected size by 2010: Rs 427 billion; CAGR: 24%
Subscription revenues are projected to be the key growth
driver for the Indian television industry over the next five
years.
Subscription revenues will increase both from the number of
pay TV homes as well as increased subscription rates. The
buoyancy of the Indian economy will drive the homes, both
in rural and urban (second TV set homes) areas to buy
televisions and subscribe for the pay services.
New distribution platforms like DTH and IPTV will only
increase the subscriber base and push up the subscription
revenues.
Filmed entertainment
Current size: Rs 68 billion
Projected size by 2010: Rs 153 billion; CAGR: 18%
Advancements in technology are helping the Indian film
industry in all the spheres – film production, film exhibition
and marketing. The industry is increasingly getting more
corporatized.
Several film production, distribution and exhibition
companies are coming out with public issues. More theatres
across the country are getting upgraded to multiplexes. And,
initiatives to set up more digital cinema halls in the country
are already underway.
This will not only improve the quality of prints and thereby
make film viewing a more pleasurable experience, but also
reduce piracy of prints.
Print Media
Current size: Rs 109 billion
Projected size by 2010: Rs 195 billion; CAGR: 12%
A booming Indian economy, growing need for content and
government initiatives that have opened up the sector to
foreign investment are driving growth in the print media.
With the literate population on the rise, more people in rural
and urban areas are reading newspapers and magazines
today.
Also, there is more interest in India amongst the global
investor community. This leads to demand for more content
from India. Foreign media too is evincing interest in investing
in Indian publications. And the internet today offers a new
avenue to generate more advertising revenue.
Radio Current size: Rs 3 billion
Projected size by 2010: Rs 12 billion; CAGR: 32%.
The cheapest and oldest form of entertainment in the
country, which was hitherto dominated by the All India Radio
(AIR), is going to witness a sea-change very shortly.
In 2005, the government announced three key policy
initiatives which will drive growth in this sector - migration to
a revenue share regime, allowing foreign investment into the
segment and opening of licenses to private players.
As many as 338 licenses are being given out by the Indian
government for FM radio channels in 91 big and small towns
and cities. This deluge of radio stations will result in rising
need for content and professionals. New concepts like
satellite, internet and community radio have also begun to
hit the market. Increasingly, radio is making a comeback in
the lifestyles of Indians.
MusicCurrent size: Rs 7,000 million crores
Projected size by 2010: Rs 7,400 million; CAGR: 1%.
The industry has been plagued by piracy and had been
showing very sluggish growth in the physical format over the
last few years, both in India and globally. However, 'mobile
music' and 'licensed digital distribution' services are
projected
to fuel the recovery of the music industry the world-over.
The pace of growth in mobile music reflects the fact that
consumers increasingly view their wireless device as an
entertainment medium, using those devices to play games
and listen to music, while carriers are actively promoting
ancillary services such as ring tones to boost average
revenue per user.
Presently, ring tones (for cellular phone subscribers)
constitute the dominant component of the mobile music
market. Licensed digital distribution services are also
contributing significantly to growth in all regions.
Live entertainment
Current size: Rs 8,000 million
Projected size by 2010: Rs 18,000 million; CAGR: 18%
This segment of the entertainment industry, also known as
event management, is growing at a fast and steady rate.
While this industry is still evolving, Indian event managers
have clearly demonstrated their capabilities in successfully
managing several mega national and international events
over the past few years.
In fact, event managers are also developing properties
around events. The growing number of corporate awards,
television and sports events is helping this sector.
With rising incomes, people are also spending more on
wedding, parties and other personal functions. However,
issues like high entertainment taxes in certain states, lack of
world-class infrastructure and the unorganized nature of
most event management companies continue to hinder
growth of this industry.
Out-of-home advertising
Current size: 9000 million
Projected size by 2010: 17,500 million; CAGR: 14%.
Outdoor media sites in India are predominantly owned or
operated by small, local players and are typically, directly
marketed by them to advertisers and advertising agencies.
However, this segment too is witnessing a sea-change with
technological innovations. Growing billboard advertising is
fuelled by technologies such as light-emitting diode (LED)
video billboard.
This is a segment that is seeing interesting technological
innovations across the world and is likely to evolve in India
too in the short-term.
Internet Advertising
Current size: Rs 1.6 billion
Projected size by 2010: Rs 7.5 billion; CAGR: 50%.
An estimated 38.5 million Indians are currently hooked on to
the Internet. And this rising number is leading to the growth
of internet advertising, which today stands at approximately
Rs 1.6 billion.
The internet is being used for a variety of reasons, besides
work, such as chatting, leisure, doing transactions and
writing blogs.
This offers a huge opportunity to marketers to sell their
products. And, with broadband becoming increasingly
popular, this segment is expected to grow by leaps and
bounds.
CONCLUSION
Indian advertising Industry set to rise - no signs of vertical ad networks
The Indian advertising industry is expected to grow 61% by 2010 (with advertising spend climbing to Rs. 36,731 crores)
As per report by ZenithOptiMedia, “Expect advertising expenditure in India to increase from 0.50% of the gross domestic product (GDP) to 0.53% over the next three years.”
Worldwide, the ad industry is expected to grow 6.7% to reach $61 bn and Internet advertising is expected to surpass magazine advertising; and the upswing will be triggered by quadrennial events like Olympics, US elections and Euro 2008.
As far as Indian market is concerned:
Internet advertising contributes only 1.8 % of the country’s total advertising spends.
Internet medium is set to witness 150 per cent growth in 2008.
For every hundred rupees spent by advertisers, Rs 91 is spent on television and the print media while the outdoor media accounts for Rs 5. The rest is divided between cinema, radio and the Internet. (The Indian entertainment industry too is expected to grow by CAGR of 18% to reach Rs. 1 trillion numbers by 2011).
Though these numbers may sound great (and most of the times theoretical), what is really important and worth noticing is the rise of ad networks by newspapers/magazines worldwide (after all they are the ones who have a strong relationship with local advertisers as well as readers) which are essentially competing with ad networks from Google/Yahoo/MSN and online companies.
The industry is seeing its first flush of recovery, as key advertisers in sectors such as automobiles, real estate, financial services and consumer durables begin to report higher sales.
REFRENCES
http://www.researchandmarkets.com/reports/221191
http://www.bharatbook.com/Market-Research-Reports/Indian-Advertising-Industry-An-Analysis.html
http://www.exchange4media.com/e4m/bottombarfiles/Indian-advertising-industry.asp
http://www.pluggd.in/online-advertising-in-india/indian-advertising-industry-set-to-rise-918/
http://sasidhar.org/blog/indian-advertising-industry/
http://www.thehindubusinessline.com/2008/05/03/stories/2008050351010500.htm
www.enil.co.in/radioindustry.html
www.pinstorm.com/
en.wikipedia.org/wiki/Pinstorm
http://www.livemint.com/2008/03/18172710/Lintas-and-Pinstorm-tie-up-for.html