Advertising and consumer promotion expenditure is set to experience a significant surge of 20-25% year-on-year in the second half of 2023. This growth is expected to be driven by factors such as the Cricket World Cup, a rainy summer leading to postponed ad spends, and the festive season, according to industry executives.
Sectors such as ecommerce, FMCG, travel and hospitality, apparel and fashion, fintech, banking, retail, and automobiles are expected to lead this increase in spending.
The World Cup being played in India during prime time and coinciding with the Diwali season is anticipated to contribute to this growth. Madison World, representing several major brands, predicts a much higher advertising season starting in September compared to the previous year.
Postponed launches in the first half of the year due to unseasonal rains or inflationary pressures are expected to make a comeback in the second half. Furthermore, the second half of the year is seen as attractive for advertisers due to cricket events like the Asia Cup, Australia’s tour of India, and new entertainment shows.
The Cricket World Cup being hosted by India for the first time has generated interest from non-traditional advertisers as well. Companies in the cooling products sector, such as soft drinks, ice-cream, and refrigerators, are particularly banking on the second half of the year to compensate for the sales decline caused by heavy rains.
Beverage companies, such as Coca-Cola, are focusing on connecting their brands with consumers beyond summer. Dabur also expects higher advertising intensity in the second half of the year due to the decline in input costs, like crude and palm oil.
Appliances and electronics brands, including Godrej Appliances and high-end television brands, expect significant promotional spending in the festive season. However, the 28% GST imposed on online gaming companies may impact their ad spend, potentially leading to reduced advertising during this profitable season.
A February report by GroupM forecasted a 15.5% year-on-year increase of Rs 20,000 crore in India’s advertising expenditure in 2023. This figure may need to be revised higher due to the cricket season and what industry executives refer to as a “second summer.”
