Indian advertising in 2026: Creativity in an era of AI, data and mergers

By the end of 2025, Indian advertising was operating within a fundamentally altered system. It increasingly operates as a function of data, media efficiency, and artificial intelligence. This shift has not happened in isolation. It has been shaped by two defining forces of 2025: the industry’s accelerating pivot towards performance-led systems, and a wave of agency mergers that fundamentally altered where creative power now sits.

By the end of 2025, Indian advertising was operating within a structurally changed ecosystem. Decisions that once relied on creative judgement now move through dashboards, algorithms, and efficiency models. Artificial intelligence has transitioned from experimentation to infrastructure. At the same time, agency consolidation reduced the number of independent creative agencies, folding many into larger, integrated or network-led structures. Within this revised system, creativity no longer inherently occupies the centre. It is increasingly required to function within frameworks designed for speed, scale, and predictability.

The strain on this paradigm is now visible in the data. Marketing budgets have remained flat at 7.7% of company revenue, according to Gartner’s 2025 CMO Spend Survey, while 59% of Chief Marketing Officers reported insufficient budgets to execute their strategies. 2025 also exposed the limits of performance-led growth. Research from Analytic Partners shows that brand marketing outperforms performance marketing in 80% of cases across sales and return on investment. The industry’s pivot towards short-term conversion has created a value gap that optimisation alone has not been able to close.

As 2026 begins, Indian advertising faces a paradox. Campaigns are reaching more people but leaving little impression, driving conversions without building memory, and scaling content without creating distinctiveness. In parallel, fewer creative agencies now operate with the autonomy to lead brand thinking independently, raising questions about where long-term creative ambition can realistically come from.

Creativity in an efficiency-first, consolidated world

Creative decisions now follow media, data, and efficiency frameworks. Algorithms determine who sees what, when, and how often, while AI accelerates production and optimisation. In many agency environments reshaped by mergers, creativity no longer leads the process; it enters after systems have already defined constraints.

Arun Iyer, Founder and Creative Partner at Spring Marketing Capital, characterises this transition as structural and speaks about 2026 outlook. “Data will become table stakes,” he says. “Everyone has access to it now. Data can tell you what is happening and how fast something is working or not working. But creativity decides why a brand matters.”

This distinction is critical in a market where creative agencies increasingly operate within integrated models. Data explains behaviour, but it does not explain meaning. Creativity’s role is to interpret insight and turn efficiency into relevance, and action into memory, even when it is no longer the primary driver of strategy.

KV Sridhar (Pops), Global Chief Creative Officer at Nihilent Limited and Hypercollective, argues that creativity’s role became misunderstood as performance marketing rose to prominence.

“Data cannot compel people to buy. It identifies who is most likely to purchase and helps optimise media spend. But the real challenge has always been how effective your communication is — how well you understand what will motivate consumers.”

Performance marketing, Pops explains, relies on short-term triggers such as discounts or urgency-driven prompts. These tactics accelerate immediate purchases but do not create desire or expand the market. Traditional advertising, in contrast, built aspiration, awareness, and loyalty, speaking to people who were not yet ready to buy, educating them, and making them care.

Algorithms and data have amplified efficiency, targeting only those with the intent to purchase. “Instead of spending ₹100 crore broadly, you spend ₹10 crore and reach only those most likely to buy,” Pops says. “It eliminates wastage but narrows the market. If you only speak to buyers, your market never grows.”

This shift is already underway. Brands are recognising the need to communicate to audiences with varying levels of intent. Platforms like Meta are adjusting algorithms to reward creative diversity, encouraging messaging for buyers, potential buyers, and even those who might never consider the product. 

“The principle is what traditional advertising has always taught: don’t just push for immediate purchase; build affinity and brand familiarity across mindsets,” Pops says. 

This shift was not theoretical. Its cracks were already visible in how creativity showed up in Indian advertising throughout 2025.

What 2025 taught us

Looking back at 2025, creativity in Indian advertising largely adapted to working within efficiency-led structures rather than challenging them.  Siddhant Sharma, Founding Partner at itch, describes the year as one defined by “Relatability with better craft.” 

“Brands quietly fit themselves into everyday behaviour instead of making everything revolve around them. It felt smart, not staged.” 

Humour became one of the most reliable tools in this environment. Rohan Kumar, Executive Creative Director at VML India, sees its return as a response to cultural fatigue. “Humour is back in fashion. And boy do we need it. For years nostalgia, dominated. And I feel to some extent that’ll always be there. But today with everything around us feeling so heavy, I don’t need brands giving me another memory, I’d rather they crack the tension." While humour made its mark, Kumar argues the industry didn't lean into 

that it was rarely layered with emotional depth, pointing to a missed opportunity to explore quieter, more truthful forms of joy. 

Nostalgia continued to perform, but primarily as emotional shorthand.Aalap Desai, CCO and Co-Founder at tgthr., notes that humour and memory worked because they offered comfort in a turbulent year. “Humans love to laugh, and people love memories,” he says, adding that stories of resilience and hope resonated most strongly.

What changed last year was not the emotion, but the confidence with which brands trusted the audience to get the reference without explanation. Flipkart’s use of R.D. Sharma didn’t rely on overbuilding his legacy; it assumed viewers already carried the memory of school textbooks, tuition anxiety, and exam pressure. The joke landed because the campaign didn’t pause to justify why he mattered. It simply lets recognition do the work. 

Zepto, for instance, consistently used humour as its primary route to relatability. From an over-the-top reaction to a robbery to sell mayonnaise, to a playful take on India’s love for biryani and its pairing with a specific rice brand, the brand leaned into exaggerated everyday behaviour, letting familiar emotions, rather than hard selling, drive recall.

What stood out was how these approaches travelled across categories. Humour and nostalgia were no longer confined to food delivery apps or D2C brands.

Financial services, which typically use cautious and credibility-driven approaches, used comedy to reduce fear and intimidation. HDFC Securities used humour-led storytelling to address fraud awareness, choosing lightness over alarmism. The jokes didn’t dilute seriousness; they lowered resistance, making the message easier to absorb.

Entertainment and pop-culture brands leaned into self-reflexive humour. Shark Tank India used satire to roast toxic corporate culture, effectively acknowledging criticism of hustle culture instead of deflecting it. The humour worked because it didn’t punch down; it admitted complicity.

“They worked because more and more brands are realising the audience isn’t dumb, and it’s good to see,” Sharma says.

Together, these trends showed that creativity could still connect emotionally within constrained systems. At the same time, they exposed the limits of adaptation. Much of the work succeeded within existing frameworks, but rarely stretched them.

AI, scale, and the human edge

By 2025, pressure on creativity was no longer only about metrics or platforms; it was also about volume. Brands were expected to produce more content, more frequently, across more formats. AI emerged as a powerful response to this demand. This is when AI became the disruptor of 2025. Brands across sectors, from FMCG to QSRs to legacy global icons, experimented with AI-generated visuals, copy, and even short-form films. McDonald’s, Coca-Cola, and H&M publicly integrated AI into production pipelines. Yet even an AI-first brand like OpenAI relied entirely on human storytelling for its global ChatGPT campaign, emphasising that meaning cannot be automated. 

Reports suggesting AI-driven video campaigns delivered over 30% ROI gains reinforced its appeal. Yet efficiency alone does not replace cultural understanding. Reflecting on 2025, Prathap Suthan, Managing Partner and Chief Creative Officer at Bang in the Middle, outlines the risk ahead.

“The market will flood with AI-generated work. Competent, yet mediocre. Machines can never understand if tears are cold or warm. You cannot A/B test for goosebumps or smiles.”

Suthan argues that creativity remains inseparable from lived experience. “Authenticity is the electric moment when my mind, shaped by one utterly unrepeatable life, collides with a brief and produces something the world has never seen. AI works with patterns. Zero lived experience inside.”

Arun Iyer echoes this concern, predicting a polarisation in Indian creativity. “On one end, we’ll see a lot of AI-generated sameness. On the other hand, brands that actively chase culture, language, humour, and lived insights with real depth.” The difference, he notes, lies in origin: AI recombines patterns, while humans create from experience.

Suthan says, “Everything can be automated, commoditised, or outsourced. But the mad act of inventing something that surprises, moves and connects remains stubbornly human.” In 2026, this perspective will guide which campaigns cut through the noise; those rooted in culture, emotion, and authentic human insight will outperform mechanically efficient content.

Together, these shifts point to a clear turning point. Performance marketing has made advertising faster, but it has also limited how boldly brands think. AI has helped brands scale content, but it has also increased sameness. Creativity today is working inside systems built for efficiency, not for building meaning.

For Indian advertising, the future of creativity will not be decided by technology alone, but by who controls the brief, who defines success, and whether creative thinking is allowed to lead rather than respond. Now as fewer independent creative agencies remain, protecting creative intent may be the industry’s most urgent challenge yet.