Ad spend likely to rise 15% this year

The burgeoning advertising budget in India is set to hit another high this year, with ad expenditure likely to touch Rs 1,609 core in 2006. And this means a growth of 15.5 per cent over 2005, when the ad expenditure in the country was Rs 1,392 crore.

The percentage jump in ad spend in India also outstrips the global growth rate of 5.8 per cent. The ad spend worldwide is likely to touch $391 billion this year.

Among different media, the internet witnessed the fastest advertising growth in India, posting a 0.9 percentage point increase in the 2002-2006 period, vis-a-vis press ad that actually had a negative growth of an identical margin.

Outdoor advertising, too, fell by 0.01 percentage points, while others such as radio and television grew by 0.4 and 0.2 percentage points, respectively.

Let's see the findings of the Spheres of Influence 2006, a global analysis of advertising expenditure study done by Initaiteve Futures Worldwide. The ad spend trend in India to a large extent mirrors the global trend for the same period.

While spending in press declined by 4.5 percentage points, ad spending on the internet increased by 3.3 percentage points.

Similarly, outdoor and radio declined by 0.1 and 1 point, respectively. In actual terms, the internet spend in India is likely to rise the most this year "� going up 35 per cent to Rs 150 crore from Rs 110 crore.

Outdoor ad spend is set to increase 15 per cent, while press spend should be up 14.2 per cent. Again, television spend is projected to move up 16.8 per cent, while radio advertisement is expected to shoot up 20 per cent.

Globally, though press still commands a large share of total ad spends, it has been declining steadily over the last few years. From 42.2 per cent in 2002, it is expected to slump 37.8 per cent this year. The report pointed out that none of the markets surveyed would see a fall in ad spend in 2006.

At the global level, 2004 was the best year in advertising since 2000, with spends up 7.9 per cent year on year.

On the trends in mature markets, the report stated that while regions such as western Europe and North America are losing share of total worldwide advertising spend, Asia and central and eastern Europe continue to gain in share in 2006.