With the huge increase in smartphone and Internet use, digital ad expenditure in India is expected to reach $21 billion by 2028, according to a survey released on Tuesday. Notably, the rise of user-generated content (UGC) will enable individual producers and influencers to establish a digital identity that brands may exploit for digital advertising.
According to a Redseer Strategy Consultants analysis, this strong ecosystem of 2.5 to 3 million producers is predicted to fuel marketing investment of $2.8 billion to $3.5 billion by 2028.
Due to macroeconomic circumstances, digital ad spend in the country is expected to develop slowly in FY23, after which it will account for 65-70 percent of total ad spend in India, expanding at a CAGR of 19-21 percent.
“Upon mapping market sizing across media agencies, we observe a significant under-reporting of digital ad spend in India. However, our projection has considered enterprise spends, SMB spends, influencer marketing, affiliate marketing and gaming,” said Mukesh Kumar, engagement manager, Redseer.
Digital platforms have a high engagement rate, with consumers spending approximately seven hours per day on their devices.
E-commerce, short videos, OTT, social media, long-form videos, and news channels are some of the most popular performances driving digital ad platforms.
According to the report, the global downturn caused by rising interest rates, the energy crisis, and other factors has led to new-age enterprises focusing on profitability and managing ad spending, resulting in slower growth in FY23.
According to the survey, despite present economic difficulties, the ad market is expected to increase by 6-8 percent in FY23.
“We expect macroeconomic engines to pick up momentum again by FY24 since, after every economic downturn, eventually, consumer morale returns,” it added.
According to the survey, as the creator economy evolves, it is critical to bridge the gap between businesses and influencers via a centralised platform such as the creative marketplace.