Despite a cutback in ad spends by most advertisers in December quarter, media agencies GroupM and Zenith say India will continue to be among the world's fastest-growing ad markets in 2017. The forecast comes as both agencies see cash crisis triggered by demonetisation as temporary.
GroupM, media arm of WPP, said India was a key market with ad growth in 2017 pegged at 12.5 per cent, led by low interest rates, sustained urban demand, and impact of key reforms such as goods and services tax.
Zenith, part of Publicis Groupe, said India's ad growth in 2017 would be 11.2 per cent.
In 2017, categories that would lead ad growth in India would be mobile wallets, telecom 4G, banking, financial services and insurance, mobile handsets, fast-moving consumer goods and consumer durables, said Zenith. "In November, the central government introduced demonetisation, which has led to some contraction in ad spends. We expect demand for goods and services to pick up and this shortfall to be temporary," Tanmay Mohanty, group chief executive officer (CEO), Zenith India, said.
Ironically, the rise of mobile wallets comes at a time when categories such as e-commerce, a key driver of ad growth in India over the past three years, are slowing down. The trend, explains Ashish Bhasin, chairman and CEO, South Asia, Dentsu Aegis Network, has been going on for a while now as consolidation and emphasis on profit grows among e-commerce firms.
Paytm, Mobikwik, and Freecharge have given full-page ads in newspapers over the last one month. Mobile wallets are marking their presence felt aggressively on TV and digital.