Ad volume growth on Video & Social slower than expected: S Venkatesh

Magna Global, the strategic global media unit of IPG Mediabrands, has released its half-yearly report on Adex growth forecast for India. As per the report, India’s Adex growth in 2016 has been pegged at +16.2 per cent, compared to the +18.4 per cent growth predicted in December 2015. The size of the industry is expected to touch $9 billion or Rs 564 billion equivalents.

Magna also reports an early prediction of the India Adex in 2017, which it says will grow +15.7 per cent. India pips Italy to get into Top 10 list this year and estimated to move up four ranks to become the 6th largest advertising market by 2020.

In this interaction with AdGully, S Venkatesh, EVP, Director Intelligence Practice, Magna Global – India, throws more light on the study, the growth drivers for the Indian advertising industry, impact of the proposed GST Bill, and more. Excerpts:

From a predicted Adex growth of 18.4 per cent, the figure has been revised to 16.2 per cent. What are the factors contributing to this deceleration?
We had earlier estimated a stronger growth for Mobile across formats. Advertising volume growth, especially on Video & Social will not be at the same pace we had expected during our last forecast.

How do you see the proposed GST Bill impacting ad spends?
Advertising follows economy footprint and the principle – ‘ad revenue grows when GDP grows’ – will apply. GST is expected to add a couple of percent to the GDP growth and there by a positive impact on advertising spends too.

What keeps print buoyant in India for advertisers?
Print will remain buoyant as long as readership and circulation continue to grow. Content is consumed in both physical and digital forms, ABC’s digital measurement is definitely a step forward for publishers to monetise their otherwise elusive readers. Platforms like Magzter will provide contextual and interactive formats for advertisers to keep their consumers engaged. E-retail has definitely helped advertisers overcome the challenge of distribution and media follows product consumption. IRS falling into track is icing on the cake for both advertisers and publishers.

How much of a boost to ad spends do you envisage from the Government sector?
The Government of the day has proved to be the most interactive one so far and efforts to popularise their work will accelerate further. The recent introduction of rating system on Print for DAVP to allocate promotional budgets, intent to revive state radio broadcast and extremely digital savvy Government will bolster overall ad spends.

What, according to you, could be the stumbling blocks to Adex growth in India?
Measurement portfolio expansion and unified view of media consumption definitely gives that inflection point for Adex growth. With digital becoming a way of life, some of the most debated topics like Viewability and adblocking need industry accepted guidelines. Monetising the mobile audience is nearly taking the centre stage and has an all pervasive effect on the way content is distributed and consumed.

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