This make India sound like an ideal place for Western companies looking for growth.
Before jumping in, though, it is good to know a bit more about the country’s media landscape and what the competition is like for ad space.
For example, how much time do people spend online in India? What offline media is most popular? And are there any channels which are overly crowded with advertising, or perhaps an opportunity to try an underused one?
To help find answers to these questions, and many more, Econsultancy and Datalicious recently surveyed marketers globally about their media spending and compared it with the time consumers spend on various media channels in particular markets.
Findings from the survey are now available in an Econsultancy report, the Media Budgets Index.
The report
The Media Budgets Index analyses data from five markets from across the globe on this and other topics and offers specific insights for each region covered.
Subscribers can download the report and there will be two webinars to discuss the findings, one for the UK and another for the APAC region:
- June 21, 2016 at 10am UK time (Sign up here).
- June 23, 2016 at 10am Singapore time (Sign up here).
Below is an overview of a few of the interesting trends from marketers in India.
India consumes most of its media offline
Despite significant growth in the percentage of Indians online over the past few years, nearly 80% of time spent consuming media in India is spent offline.
This figure is quite different from Singapore where only 62% of time spent consuming media is offline and Australia and New Zealand where the figure is 64%.
Surprisingly, India is more like the USA where, according to the report, 76% of time spent consuming media is spent offline.
But marketers in India still underspend on digital
Indian marketers, however, spend a much higher percentage of their budget on offline (87%) than consumers spend time offline (79.6%).
This indicates that marketers are slow to adapt to the changing media landscape and not adjusting spending according to where their audience is spending their time.
Compare this with marketers in the USA who, with a similar amount of time spent consuming media offline, spend a slightly lower percentage (73%) of their budget than the percentage of time consumers spend offline (76%).
Offline media spend is not well-allocated either
Another issue which came up in the survey is that budgets for different kinds of offline media do not match the respective time spent.
For example, Indians spend 67% of their time consuming media on TV, yet marketers spend only around one-third (33.8%) of their budget on the media.
So where is the money going?
If we look at time spent versus budget allocation per media, we can see that marketers in India are overspending on print.
According to respondents, Indian marketers are spending one quarter (25.4%) of their budget on print media, even though consumers spend a scant 6.5% of their time on the medium.
TV spending is likely to rise
It seems likely, however, that this underspend on TV and overspend on print may change soon.
Nearly three in five (59%) marketers in India cite TV as a ‘very effective’ advertising medium, a good indication that spending will rise, not fall.
Also, twice as many marketers in India are looking to increase spending on TV in 2016 than in nearby Singapore.
Additionally, the report indicates that only 37% of Indian marketers surveyed are planning to increase spending on social media this year, a medium which would benefit from a reduction in offline media spending.
Note that the percentage of Indian marketers who are increasing spending on social media is far lower than those in the UK, where 66% plan to allocate more budget in that area.
Marketers in India are very fond of direct response
Marketers were also asked to indicate how they use each media channel – for direct response, branding, or both.
Looking at the chart, it’s clear that marketers in India were far more likely to use channels for direct response only than marketers globally or in Singapore.
For example, TV advertising was used as direct response only by around 20% of marketers globally, but Indian marketers were more than twice as likely (42%) to do so.
Only in paid search were Indian marketers slightly behind the global average (26% vs 30%) in using the media purely for direct response.
The verdict
Most people in India consume their media offline and most marketing budget is spent offline. This makes sense.
What the survey uncovered, however, is that the move to digital in India is happening slowly.
Indian marketers are still overspending on offline media and underspending on online media. Additionally, they are vastly underspending on the media where Indians spend more of their time, TV.
This is likely to change as the Indian online population grows, but the survey indicates that it will be a long time before time spent online in India matches that in the West.
Christian Bartens, CEO and Founder of Datalicious, sums it up:
Obviously internet penetration is lower [in India] than in many Western nations, but mobile technology is seeing that change very rapidly.
We can expect a seismic shift in spending behaviour in India as more people move online, which is going to create a steep learning curve for marketers and planners who need to ensure they allocate budget effectively.
The risk is that Indian marketers’ slow movement to digital will be at the expense of overall marketing efficiency.
So for brands that are considering a launch in one of the world’s biggest and most dynamic markets, consider these findings and adjust your strategy accordingly. India is moving to digital, but at its own speed.
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