INDIAN INDIAN

ADVERTISING ADVERTISING

INDUSTRY : INDUSTRY :

TUSSLING IN TUSSLING IN

THE GLOBAL THE GLOBAL

MARKETMARKET

Made by:Roshni Patel

D 15BBA general3rd semester

INDEXINDEX Acknowledgement

Introduction

Analysis

The Trend

Analyzing the Global Advertising Industry

Indian ad industry attracting overseas attention

Indian Ad Agencies Finding Feet Abroad

PINSTORM

COMPANY PROFILE APPROACH & SERVICES THE TEAM MORE ABOUT PINSTORM PINSTORM CLIENTS

Lintas & Pinstorm tie up for Digital Facts & Figures: Indian Advertising Industry

Advertising

TELEVISION FILMED ENTERTAINMENT PRINT MEDIA RADIO MUSIC LIVE ENTERTAINMENT OUT OF HOME ADVERTISIMENT INTERNET

CONCLUSION

REFRENCES

Indian advertisin

g industry:

An Introducti

on

The Indian advertising industry is talking business today. It has evolved from being a small-scale business to a full-fledged industry. It has emerged as one of the major industries and tertiary sectors and has broadened its horizons be it the creative aspect, the capital employed or the number of personnel involved. Indian advertising industry in very little time has carved a niche for itself and placed itself on the global map.

Indian advertising industry with an estimated value of es13, 200-crore has made jaws drop and set eyeballs gazing with some astonishing pieces of work that it has given in the recent past. The creative minds that the Indian advertising industry incorporates have come up with some mind-boggling concepts and work that can be termed as masterpieces in the field of advertising.

Advertising agencies in the country too have taken a leap. They have come a long way from being small and medium sized industries to becoming well known brands in the business. Mudra, Ogilvy and Mathew (O&M), McCann Ericsonn, Rediffussion, Leo Burnett are some of the top agencies of the country.

Indian economy is on a boom and the market is on a continuous trail of expansion. With the market gaining grounds Indian advertising has every reason to celebrate. Businesses are looking up to advertising as a tool to cash in on lucrative business opportunities. Growth in business has lead to a consecutive boom in the advertising industry as well.

The Indian advertising today handles both national and international projects. This is primarily because of the reason that the industry offers a host of functions to its clients that include everything from start to finish that include client servicing, media planning, media buying, creative conceptualization,

pre and post campaign analysis, market research, marketing, branding, and public relation services.

Keeping in mind the current pace at which the Indian advertising industry is moving the industry is expected to witness a major boom in the times ahead. If the experts are to be believed then the industry in the coming times will form a major contribution to the GDP. With al this there is definitely no looking back for the Indian advertising industry that is all set to win accolades from the world over.

Indian advertisin

g industry:

An analysis

This report starts with a historical overview of the Indian advertising industry and examines how advertising spends have undergone a change over the years. It looks at the trends and key drivers and their impact on the industry. A summary of the issues faced by the advertising industry has also been included. The report conducts a detailed external and internal study of the Indian advertising industry within the PEST and Porter frameworks.

It also studies the competitive landscape including the top three agencies- JWT, O&M, and Lowe’s. Since the agencies are not listed and do not disclose their financial

information, the report has alternatively covered a summary of their operations and competitive strategies. The report concludes with an outlook on the industry.

The Indian advertising industry has been evolving at a fast pace over the past few years owing to an increase in the forms of media and communication and the emergence of new distribution channels. Currently India has a low advertising spend to GDP’ ratio as compared to other economies. Competition

for the outsourcing business and creativity leakage represent the major issues and implications. However, the television advertising is expected to register high rates of growth, with India expected to become Asia's leading cable market by 2010.

Executive SummaryThe Indian advertising industry is being reshaped by regulatory and technological changes spanning various media platforms- radio, TV, internet, print, and outdoor.

Deregulation involving FM radio, Direct-to-Home (DTH), broadband, the implementation of the conditional access system (CAS), and foreign direct investment has laid the foundation for faster growth of the advertising industry. Stricter norms on social responsibility, obscenity, and ethics are altering the industry practices.

The industry is dominated by ten agencies, who account for the majority of capitalized billings. Top 10-15 advertisers with the biggest ad spend (like HLL, Maruti, Hero Honda, Pepsico) wield high

bargaining power and their account movement from one agency to another alters the competitive dynamics.

Table of Contents:

1. Introduction

1.1 Industry DefinitionThe Indian advertising industry comprises

establishments that create and sell advertisements for media such as newspapers, periodicals, radio, and

television.

1.2 Industry SegmentsSigns and Advertising Displays

Advertising AgenciesOutdoor Advertising Services

Radio, Television, and Publishers' Advertising Representatives

Advertising Not Classified Elsewhere, Direct Mailadvertising Services

2. Market Dynamics

2.1 Market OverviewIndian advertising industry is being driven by rising

consumerism and the entry of global brands. In 2005, the industry experienced a growth of 10%.

2.2 Trend AnalysisIncreasing Popularity of Online Advertising

Shift towards a Fee-Based SystemGrowth in Out-of-Home Advertising

2.3 Key DriversPenetration of Delivery Platforms Rising

Increased Broadband AccessMobile Advertising

2.4 Major Issues and ImplicationsCompetition for the Outsourcing Business

Creativity Leakage

3. PEST Analysis

3.1 Political FactorsReview of Advertising Code

Ban on Surrogate Advertising Hitting Advertising RevenuesCAS Implementation Altering Viewership DistributionDirect-To-Home Growth Spurring Niche ProgrammingFM Radio Deregulation Increasing Media Penetration

3.2 Economic FactorsOpportunities from Rural Income Growth

GDP Growth Fuelling Advertisement Spends

3.3 Social FactorsTweens Emerge as Influential Consumer

Non-Metro India Influencing Advertising Strategies

3.4 Technological FactorsDigital and Graphic Innovation in Outdoor Advertising

Animation Industry Driving CreativityINSAT-4A Launch

Internet Penetration Driving Online Advertising

4. Michael Porter’s Five Force Analysis

4.1 Buyer PowerIncreased Bargaining Power of Buyers

Big Accounts Rule Over Agencies

4.2 Supplier PowerShortage of Creative Talent

Mushrooming TV Channels Advantageous for Agencies

4.3 Intensity of CompetitionConcentrated Market with MNC’s Leading the Industry

Advertising Players Setting up Second AgenciesRush for Neighboring Markets

4.4 Threat of New EntrantsDominance of Top Agencies

India Gaining Popularity as an Emerging Market

4.5 Threat of Substitute ProductsDirect Marketing

5. Competitive LandscapeOgilvy and Mather

LoweJWT

5.1 Competitive PositioningPresence in Cities across India

Capitalize BillingCreative Successes

Loss of Major AccountKey People

5.2 Competitive StrategiesO&M

• Sets up Digital Media Network Firm• Consolidates Out-of-Home Businesses

Lowe• Offers Brand Marketing Consulting

JWT• Targets Airlines, Financial Services and Telecom

• Repositions Fortune as a Full Service Agency

5.3 Operation Analysis

5.3.1 Client BaseO&M-Asian Paints, CastrolLowe- Pepsodent, Close Up

JWT-Pepsi, DeBeers

5.3.2 Major AccountsO&M-Hutch: You and I, Fevicol: Building Bonds

Lowe India- Surf Excel: Stains are Good, Axe: The Axe EffectJWT-Pepsi “Yeh Dil Maange More”, Lux: Beauty Soap for Film

Stars

5.4 Key DevelopmentsO&M –O&M Launches Meridian, Ogilvy Worldwide

Outsourcing Work to IndiaLowe India - Wins LG Account, Lowe loses Liril to McCann

JWT- JWT bags Hero Honda Super Splendor, JWT loses Kentucky Fried Chicken

6. Industry OutlookIndian advertising industry is forecast to grow at the rate of 12-15% in

2006.

Indian Advertisin

g Industry:

The Trend

The Indian advertising spends, as a percentage of GDP, is 0.34%, which lags behind other developed and developing countries.

During fiscal 2005, the gross advertising spend in India is estimated at Rs 111 billion, and is expected to grow at

14.2% to reach Rs. 127 billion by fiscal 2006.

The key factors which have contributed to growth of the Indian advertising industry

include:

Rapid economic growth of the country on the back of economic liberalization and deregulation

Increase in consumer prosperity

Entry of global consumer companies with large advertising budgets

Higher degree of competitive intensity among consumer companies; and

Growth in media vehicles leading to increase in media penetration

Segmentation of Advertising Spends

The five key industry segments comprise print, television, radio, cinema, and outdoor. These

different segments within the industry are at varying stages of growth and corporatization.

Media Spends as % of Total Ad SpendYear Print TV Radio Cinema Outdoo

rInternet

2000 49.0% 39.3% 2.5% 0.5% 8.4% 0.3%2001 48.4% 40.6% 2.7% 0.4% 7.5% 0.4%2002 47.2% 41.9% 2.9% 0.7% 7.0% 0.4%2003 46.6% 43.0% 2.9% 0.7% 6.5% 0.4%2004 46.3% 43.7% 2.9% 0.6% 6.0% 0.3%

The Indian television industry has grown rapidly, especially since 1991, which saw the beginning of satellite broadcasting in India. This growth was also aided by the economic liberalization program of the Government. The growth of the satellite television

audience saw proliferation of a number of satellite television channels offering more choices to media buyers and consumers of entertainment. Thus, the television broadcasting business, which started off as a single government controlled television channel, now has over 300 channels covering the Indian footprint, resulting in growing ad spends on this medium. Reforms and proliferation of private players were the key reasons for this rapid growth of the share of television in the advertising industry.

Similarly, sectoral reforms and increased number of players could drive market expansion for emerging media segments including radio, outdoor, cinema and internet.

Analyzing the Global

Advertising Industry

The global advertising industry is showing definite signs of a recovery, after one of the worst-ever slumps in advertising. Media-buying firms, TV

broadcasters and radio and billboard companies are making positive noises about the future. Print

advertising looks more promising and several US magazines saw ad pages increase quite dramatically.

The future of the ad industry is not in doubt - things will get better, but only companies that have

positioned themselves correctly will be able to capitalize on the upswing. To do this, many firms are looking toward technology as the point of departure for huge returns. The convergence of the Internet

with television, the growth of wireless communication, and the increasing use of digital

video recorders all offer new avenues and challenges for advertisers. Further consolidation across national

borders is also expected as ad firms try to deliver global capabilities in an increasingly competitive

market.

Aruvian Research’s report on Analyzing the Global Advertising Industry thoroughly explains the global

advertising industry by establishing a clear demarcation of the industry components and the top

spenders as well as the service providers in the global context. This helps the reader understand the

industry in a nutshell overlooking the competitive activity in the industry.

The report also builds a geographical mapping of the major advertising markets worldwide namely the United Kingdom, France, Germany, China, Japan,

Canada, Spain, The Netherlands, Italy, Belgium and the United States. In this section, the report explains each of these markets in detail with their commercial

characteristics along with the major players which are active in these markets thereby drawing up the

overall business picture for advertising in these markets.

Indian ad industry

attracting overseas attention

The Indian advertising industry is increasingly attracting the attention of many American companies and communication agencies, opening up business avenues for the small and medium marketing agencies in India.

Worldwide Partners Inc, the ninth largest global network of more than 90 marketing and communications agencies in about 50 countries, recently tied up with Indian Pressman

Advertising & Marketing Ltd following repeated enquiries about India.

“In the last year, we got the most number of enquiries for India and its advertising scenario from America, followed by enquiries from West Asia and some from Europe,” said Ms Lisa Kettman-Kervinen, Director, Worldwide Partners Inc, on a recent visit to India.

Most of the enquiries were in the nature of harnessing online solutions like logo designs, computer science graphics and outsourcing of other digital solutions. India already has a reputation for computer skills due to the digital education in India and so more and more clients are waking up to the fact that there is good business possibility here.

Before Pressman came on board as a full partner in December 2007, Worldwide partnered Image Ads for some years, before the company decided to sell part of their agency and sold shares back to the network.

Today, ‘Worldwide’ has two partners in India, with Images being an associate partner. Each partner is a shareholder in the network.

Currently, Worldwide is focusing on strengthening its position in India and Korea specifically and Asia Pacific largely, to get more partners and directors on board, she said. The network is scouting for a director based out of Singapore for the purpose.

The network has a fairly established presence in the rest of Asia with offices in China, Japan, Malaysia and Australia.

For Pressman, which handles clients such as Bata India, BlueStar, Mudra Lifestyle and LIC, it is a good opportunity to connect with agencies from across the world in Worldwide’s network.

“The network is like a well where we can dip for some more water as and when we require,” said Dr Niren Suchanti, Chairman and Chief Executive Officer, Pressman. “It is a very active network where we have already received 60 enquiries in a week. As all members do business independently, we can negotiate and agree on some small fee to use the expertise of the other agency, including exchanging creatives for specific campaigns.”

THE ECONOMIC TIMES:

Indian Ad Agencies

Finding Feet Abroad

Perhaps for the first time, the Indian ad agency flag is being hoisted on foreign soil. The dream of a

traditional, brick-n-mortar Indian ad agency (yes, majority-owned by Indians, not Indian arm of a global

agency network), of going global is finally being realized, albeit by a host of new generation agencies

that focus on the digital and mobile space.

Search engine marketing firm Pinstorm, set up by Mahesh Murthy, is foraying

beyond Indian, Malaysia and Singapore to set up offices in

China, US, UK and Sweden and Australia by next year.

Internet promotions company, Webchutney, is expanding in the South-East Asian region, specifically Malaysia and

Singapore by next month. Mobile marketing company, Mobile2win (owned by

contest2win), set this trend by incorporating in Hong Kong (this operation has recently got bought over

Disney), even before it opened its Indian office in ‘03.

If internet knows no boundaries, why should ad agencies in this space have one, goes the logic with

most players here. Anyway, all these internet agencies already work for global clients, either

onshore such as mobile2win or outsourcing work offshore, much like Webchutney. Already, almost

two-third of online agencies revenues is coming from global clients.

“It is much easier to watch trends in media online. Making an ad online is far easier than doing it in

traditional media,” says Siddhartha Rao, CEO & co-founder, Webchutney.

“We started with a global dream, unlike the typical, traditional agency where you set up a local office and

then hire 40 people. We learnt the lessons from Infosys and Wipro and implemented it on ourselves,”

says Mahesh Murthy, CEO of search marketing company, Pinstorm.

And its not that their office footprint are getting global - they even call their creative teams as

‘delivery teams’. These agencies have dedicated delivery team a la software firms that work closely with the business development/servicing teams of clients who may be sitting anywhere, Sydney to

Stockholm.

No wonder interactive agencies are growing at a stupendous, over 400% per annum, and expect this

kind of growth to continue for the next couple of years. Asia-Pacific markets are rich picking grounds

for interactive agencies, owning to high internet penetration amongst consumers, coupled with a

paucity of interactive players.

“Setting up our base there has no real cost advantage to us. It is the hunger to explore and tap these markets that driving us there,”

adds Rao. Webchutney plans to

bring in big ticket venture capital

funding in the next six months to fund

its global expansion plans, with a strong base in West Asia.

The fear of being gobbled up by big global players it seems is no dampener to these players. “If we don’t turn out to be multinational, we at least would like to be a pan Asian,” adds webchutney’s Rao. This global-

local game is something that Alok Kejriwal, CEO, contest2win, has already worked out well.

Even though Disney has bought out the entire stake holding of Mobile2Win China, the Indian operations in Mobile2Win India remain independent. In fact Mobile

2Win India seems is still chasing the global run. It recently inked a deal with Freemantle (its partner for

Indian Idol) to work on Philippine Idol.

“Its time for interactive agencies such as ours to not let geography limit us. The resurgence of the internet

is just helping our global mindsets.”

http://www.pinstorm.com/

COMPANY PROFILE

Type PrivateFounded 2004

Headquarters

Mumbai, Maharashtra, India

Key people

Mahesh Murthy, Founder & CEO

Ansoo Gupta, Global Head, Business

Industry Advertising

Services

Internet Marketing, Search Engine

Optimization, Search Engine Marketing

Employees 130Website www.pinstorm.com

Pinstorm is a pay-for-performance digital marketing firm. Pinstorm is based out of offices in Bombay - also known as Mumbai - and Delhi in India, along

with offices in Singapore, Malaysia, Europe and the United States. They service clients in North America,

Europe, Australia and Asia from these offices.

PAY-FOR-PERFORMANCE DIGITAL MARKETING

Pinstorm has been selected by Red Herring (magazine) to their list of Asia’s 100 hottest companies for 2008.

Pinstorm and Lintas Media Group have announced a

significant non-equity partnership. Designed to push clients to performance-driven media choices, the alliance

between the two leading firms in the offline and online worlds was

to put further pressure on traditional agencies and media

houses.

APPROACH & SERVICES

Pay-for-performance model: in this model clients don't pay for the creative or media costs. They pay only in proportion to the results delivered, through measurable brand visibility, or through measurable target group responses. Pinstorm has already done pay-for-performance campaigns for marketers like

Yahoo, HSBC, Standard Chartered, Jet Airways, Conde Nast and Canon.

THE TEAM

Mahesh Murthy, founder and CEO, has 24 years of marketing and communications experience – of

which over 14 years are in online marketing. While running digital marketing campaigns for a charity in late 2003, Mahesh saw an opportunity to change the

basic business model in advertising and set up Pinstorm with a bunch of great people to do so.

Ansoo Gupta is the Global Head, Business at Pinstorm. Having 14 years of experience across

marketing and advertising sales in print, online and television media across India and South East Asia. Prior to joining Pinstorm, Ansoo Gupta worked with

brands like The History Channel, National Geographic, Star TV, Channel V and First City

Magazine.

Pinstorm has a mix of Search Engine Marketing, Search Engine Optimization & Google Analytics Experts, Client Managers, Strategists, Creative

Minds, Programmers, and Global Support Staff in Finance, Information Systems, People Care and

Administration.

MORE ABOUT PINSTORM

Pinstorm turned 5 years old on May 1, 2009 and is based out of offices in Bombay - also known as

Mumbai - and Delhi in India, along with offices in Singapore, Malaysia and the United States. They

service clients in North America, Europe, Australia and Asia from

these offices.

Pinstorm sees enormous potential in search marketing –

understanding buyer demand by analyzing search patterns over time, topic and geography and

matching it to the offerings of our clients in real time, cost-effectively.

This has required the creation of a set of patent-pending technologies - from BroadWords® that lets them deploy campaigns wider and at lower cost than ever before, to BidWise® to help us bid more intelligently to GeoTrak® that points out geographical patterns in visitor and lead behaviour in real time. All available to brand owners in a pure pay-for-performance model - letting them share the risk and rewards like few other marketing firms do.

They deliver results with precise targeting for clients like American Express, Sun Microsystems, British

Airways, Qantas, Monster.com, Greenpeace and others.

PINSTORM CLIENTS

Banking, Financial Services

Education

Media

Non Profit/Industry

Organizations

OnlineServices

Recruitment

Retail &

E-commerce

Dealer Direct

Technology

Travel & Hospitality

Survey & Contests

Lintas and Pinstorm tie up for

Digital

Advertising

Pinstorm and Lintas Media Group have announced a significant non-equity partnership. Designed to push

clients to performance-driven media choices, the alliance between the two leading firms in the offline

and online worlds will put further pressure on traditional agencies and media houses. This move is

being seen in media circles as a positive step towards a more evolved phase in digital advertising.

Lynn de Souza of the Rs1, 800 crores Lintas Media Group said,

“We don’t think that just buying a digital agency will contribute to our client’s success. What attracted us

to Pinstorm was their pure adherence to pay-for-performance – a vastly different model to the

commission and retainer structures that Indian clients are used to. We think this model can go a

long way in bringing accountability and transparency to investments in advertising.”

The pay-for-performance model was pioneered by Google and Yahoo, and has been pushed further by Pinstorm, India’s only MNC digital ad firm, where the agency pays for the media and the creative – and the

advertisers just pays for results.

Mahesh Murthy, founder of Pinstorm said, “Around the world, media costs are going up and clients are cutting commissions and retainers because they are

unable to see how advertising is performing. At Pinstorm, we simply ask the client to pay for the prospects or results we deliver. Our alliance with

Lintas comes from our joint belief that the Rs16, 000 crores Indian

advertising industry needs a new model. By working together, pay-

for-performance advertising can be brought into the mainstream of

advertiser choices.”

The alliance estimates that they will be able to drive an incremental Rs100 crores of advertising to move

over from traditional models to a performance-driven model in the next 12 months. “Digital advertising accounted for just 4% of spend in India last year.

With this alliance and other efforts, investments in digital advertising will cross the Rs1, 000 crores mark, almost 100% growth over last year” said

Murthy.

“An industry only grows when there is pay-for-performance. For too long have clients worried that

their agencies and publishers are simply recommending higher media spends because that’s

how they earn more. That era will soon end. Our work with Pinstorm is to collaborate on clients to give

performance-driven options initially across digital media - but we hope over time to grow the same

basis to traditional media like broadcast, print and outdoor too” added de Souza.

The Lintas-Pinstorm alliance will first come into effect on Lintas’ roster of clients and soon expand to other businesses. Lintas Media Group is among the largest media agencies in India, managing a spend of over

Rs1,300 crores on broadcast, print, outdoor and other media for clients like Idea, Bajaj Auto, Maruti

Suzuki, ITC, Sony, UTI and Naukri.

Pinstorm is the largest independent digital advertising firm in South East Asia, with offices in

Bombay, Delhi, Singapore, Kuala Lumpur, Beijing and Santa Clara in Silicon Valley. It uses proprietary

technologies across search engine marketing (SEM) search optimization (SEO), email, SMS advertising,

online display advertising, online community creation

and blog management to handle the performance advertising needs of Yatra, Jet Airways, Taj Hotels,

Share khan and HSBC in India.The alliance is effective immediately and in place

across all advertisers in India.

Facts& Figures:Indian

Advertisi

ng Industry

Television

Current size: Rs 148 billion

Projected size by 2010: Rs 427 billion; CAGR: 24%

Subscription revenues are projected to be the key growth

driver for the Indian television industry over the next five

years.

Subscription revenues will increase both from the number of

pay TV homes as well as increased subscription rates. The

buoyancy of the Indian economy will drive the homes, both

in rural and urban (second TV set homes) areas to buy

televisions and subscribe for the pay services.

New distribution platforms like DTH and IPTV will only

increase the subscriber base and push up the subscription

revenues.

Filmed entertainment

Current size: Rs 68 billion

Projected size by 2010: Rs 153 billion; CAGR: 18%

Advancements in technology are helping the Indian film

industry in all the spheres – film production, film exhibition

and marketing. The industry is increasingly getting more

corporatized.

Several film production, distribution and exhibition

companies are coming out with public issues. More theatres

across the country are getting upgraded to multiplexes. And,

initiatives to set up more digital cinema halls in the country

are already underway.

This will not only improve the quality of prints and thereby

make film viewing a more pleasurable experience, but also

reduce piracy of prints.

Print Media

Current size: Rs 109 billion

Projected size by 2010: Rs 195 billion; CAGR: 12%

A booming Indian economy, growing need for content and

government initiatives that have opened up the sector to

foreign investment are driving growth in the print media.

With the literate population on the rise, more people in rural

and urban areas are reading newspapers and magazines

today.

Also, there is more interest in India amongst the global

investor community. This leads to demand for more content

from India. Foreign media too is evincing interest in investing

in Indian publications. And the internet today offers a new

avenue to generate more advertising revenue.

Radio Current size: Rs 3 billion

Projected size by 2010: Rs 12 billion; CAGR: 32%.

The cheapest and oldest form of entertainment in the

country, which was hitherto dominated by the All India Radio

(AIR), is going to witness a sea-change very shortly.

In 2005, the government announced three key policy

initiatives which will drive growth in this sector - migration to

a revenue share regime, allowing foreign investment into the

segment and opening of licenses to private players.

As many as 338 licenses are being given out by the Indian

government for FM radio channels in 91 big and small towns

and cities. This deluge of radio stations will result in rising

need for content and professionals. New concepts like

satellite, internet and community radio have also begun to

hit the market. Increasingly, radio is making a comeback in

the lifestyles of Indians.

MusicCurrent size: Rs 7,000 million crores

Projected size by 2010: Rs 7,400 million; CAGR: 1%.

The industry has been plagued by piracy and had been

showing very sluggish growth in the physical format over the

last few years, both in India and globally. However, 'mobile

music' and 'licensed digital distribution' services are

projected

to fuel the recovery of the music industry the world-over.

The pace of growth in mobile music reflects the fact that

consumers increasingly view their wireless device as an

entertainment medium, using those devices to play games

and listen to music, while carriers are actively promoting

ancillary services such as ring tones to boost average

revenue per user.

Presently, ring tones (for cellular phone subscribers)

constitute the dominant component of the mobile music

market. Licensed digital distribution services are also

contributing significantly to growth in all regions.

Live entertainment

Current size: Rs 8,000 million

Projected size by 2010: Rs 18,000 million; CAGR: 18%

This segment of the entertainment industry, also known as

event management, is growing at a fast and steady rate.

While this industry is still evolving, Indian event managers

have clearly demonstrated their capabilities in successfully

managing several mega national and international events

over the past few years.

In fact, event managers are also developing properties

around events. The growing number of corporate awards,

television and sports events is helping this sector.

With rising incomes, people are also spending more on

wedding, parties and other personal functions. However,

issues like high entertainment taxes in certain states, lack of

world-class infrastructure and the unorganized nature of

most event management companies continue to hinder

growth of this industry.

Out-of-home advertising

Current size: 9000 million

Projected size by 2010: 17,500 million; CAGR: 14%.

Outdoor media sites in India are predominantly owned or

operated by small, local players and are typically, directly

marketed by them to advertisers and advertising agencies.

However, this segment too is witnessing a sea-change with

technological innovations. Growing billboard advertising is

fuelled by technologies such as light-emitting diode (LED)

video billboard.

This is a segment that is seeing interesting technological

innovations across the world and is likely to evolve in India

too in the short-term.

Internet Advertising

Current size: Rs 1.6 billion

Projected size by 2010: Rs 7.5 billion; CAGR: 50%.

An estimated 38.5 million Indians are currently hooked on to

the Internet. And this rising number is leading to the growth

of internet advertising, which today stands at approximately

Rs 1.6 billion.

The internet is being used for a variety of reasons, besides

work, such as chatting, leisure, doing transactions and

writing blogs.

This offers a huge opportunity to marketers to sell their

products. And, with broadband becoming increasingly

popular, this segment is expected to grow by leaps and

bounds.

CONCLUSION

Indian advertising Industry set to rise - no signs of vertical ad networks

The Indian advertising industry is expected to grow 61% by 2010 (with advertising spend climbing to Rs. 36,731 crores)

As per report by ZenithOptiMedia, “Expect advertising expenditure in India to increase from 0.50% of the gross domestic product (GDP) to 0.53% over the next three years.”

Worldwide, the ad industry is expected to grow 6.7% to reach $61 bn and Internet advertising is expected to surpass magazine advertising; and the upswing will be triggered by quadrennial events like Olympics, US elections and Euro 2008.

As far as Indian market is concerned:

Internet advertising contributes only 1.8 % of the country’s total advertising spends.

Internet medium is set to witness 150 per cent growth in 2008.

For every hundred rupees spent by advertisers, Rs 91 is spent on television and the print media while the outdoor media accounts for Rs 5. The rest is divided between cinema, radio and the Internet. (The Indian entertainment industry too is expected to grow by CAGR of 18% to reach Rs. 1 trillion numbers by 2011).

Though these numbers may sound great (and most of the times theoretical), what is really important and worth noticing is the rise of ad networks by newspapers/magazines worldwide (after all they are the ones who have a strong relationship with local advertisers as well as readers) which are essentially competing with ad networks from Google/Yahoo/MSN and online companies.

The industry is seeing its first flush of recovery, as key advertisers in sectors such as automobiles, real estate, financial services and consumer durables begin to report higher sales.

REFRENCES

http://www.researchandmarkets.com/reports/221191

http://www.bharatbook.com/Market-Research-Reports/Indian-Advertising-Industry-An-Analysis.html

http://www.exchange4media.com/e4m/bottombarfiles/Indian-advertising-industry.asp

http://www.pluggd.in/online-advertising-in-india/indian-advertising-industry-set-to-rise-918/

http://sasidhar.org/blog/indian-advertising-industry/

http://www.thehindubusinessline.com/2008/05/03/stories/2008050351010500.htm

www.enil.co.in/radioindustry.html

www.pinstorm.com/

en.wikipedia.org/wiki/Pinstorm

http://www.livemint.com/2008/03/18172710/Lintas-and-Pinstorm-tie-up-for.html