Digital advertising in India to surpass INR 85,000 crore by 2028: PwC report

India’s entertainment and media (E&M) industry is poised for significant expansion, with a projected compound annual growth rate (CAGR) of 8.3% from 2024 to 2028, according to PwC India’s 'Global Entertainment & Media Outlook 2024–28: India perspective.' This growth will see the sector reach an estimated INR 3,65,000 crore (USD 19.2 billion), outpacing the global growth rate of 4.6%.

Despite economic challenges and geopolitical tensions, the global E&M market grew by 5.5% year-on-year, rising from INR 13,891,000 crore in 2022 to INR 17,359,000 crore in 2023. The United States continues to lead the global market, followed by China, with India ranked ninth.

Key drivers of growth

Manpreet Singh Ahuja, Chief Digital Officer and TMT Leader at PwC India commented, “India’s Entertainment & Media sector is on the cusp of a major transformation. According to our Global Entertainment & Media Outlook 2024-2028, key growth drivers such as digital advertising, OTT platforms, online gaming, and Generative AI are shaping the future of the industry. These rapidly expanding segments are positioning India as a global leader in innovation and growth. Businesses that adapt and innovate in these areas are poised to seize unparalleled opportunities in this dynamic landscape.”

India’s significant progress in connectivity, coupled with rising advertising revenues and favourable government policies supporting foreign direct investment (FDI), further underpins the sector’s growth. The country’s millennial and Gen-Z demographic, comprising over 91 crore people, enjoys the world’s cheapest data rates, contributing to an increasingly digital consumer base. Currently, India has 80 crore broadband subscriptions, 55 crore smartphone users, and 78 crore internet users, with 78% of their time spent on mobile apps related to E&M.

Advertising and digital trends

The advertising market is projected to grow at a CAGR of 9.4%, reaching INR 1,58,000 crore by 2028, more than 1.4 times the global average. Digital advertising, in particular, is expected to grow at a robust 15.6% CAGR, increasing from INR 41,000 crore in 2023 to INR 85,000 crore by 2028. The sector has seen a year-on-year growth of 26.0% in 2023, with double-digit growth anticipated throughout the forecast period, expected to slow to 12.2% by 2028.

Traditional TV advertising, meanwhile, is projected to grow at a CAGR of 4.2%, contrasting with a global decline of -1.6%. By 2026, India is expected to become the fourth-largest TV advertising market.

Sector highlights and emerging opportunities

India’s online gaming and esports market, valued at INR 16,480 crore in 2023, is forecasted to grow at a CAGR of 19.2%, reaching INR 39,583 crore by 2028. Including real money gaming, this segment could total INR 66,000 crore by 2028, with a CAGR of 14.5%, outpacing the global average of 8.0%. The OTT sector, with a 14.9% CAGR, is predicted to double by 2028, supported by a 20.9% rise in revenues to INR 17,496 crore in 2023.

India’s cinema market continues to grow, posting a 14.1% CAGR, while print advertising is expected to expand by 3%, bucking a global decline of -2.6% and making India the third-largest print market by 2028. The music industry, including live, recorded, and digital formats, is anticipated to reach INR 10,899 crore by 2028, up from INR 6,686 crore in 2023, marking a CAGR of 10.3%.

The report also forecasts India’s B2B revenue growth at a remarkable 5.6% CAGR, the highest globally, compared to the global average of 1.9%.

Strategic recommendations

The report outlines several strategic approaches for companies to leverage growth opportunities. These include mergers and acquisitions to enhance scale, using social media for content marketing and distribution, and investing in cost optimisation through analytics and automation. The use of generative AI (GenAI) for creating hyper-personalised content is recommended to keep pace with global competitors, especially for regional players seeking technological advancement.

“Early adoption of GenAI can drive hyper-personalised content and dynamic advertising campaigns,” said Ahuja. The integration of innovative strategies and targeted investments in gaming, OTT, and digital advertising will be crucial for companies aiming to maintain a competitive edge in this rapidly evolving landscape.

India's E&M sector is set for one of the highest growth trajectories globally, driven by technological advances, a digital-savvy young population, and strategic investments. With the right blend of innovation, policy support, and adaptability, India is poised to become a global leader in the industry by 2028.