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com/docs/69981312/Effectiveness-of-Internet-Advertising-Project-Report

Advertising in India
BY: YOGIN VORA ON FEBRUARY 18, 2009 NO COMMENT

India has been among the fastest growing economies in the world, with a nominal GDP CAGR
of 9.94% over the last 10 years (1995-2005). The nominal GDP for fiscal 2005 was Rs. 30,636
billion. According to CSO estimates nominal GDP growth for fiscal 2006 is estimated at 10.9%.
There is a correlation between the economic growth rates of a country i.e. the nominal GDP
growth rate, and growth rates of the advertising industry
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
Segmentation in advertising
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 Spend
Year Print TV Radio Cinema Outdoor Internet
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 anumber of satellite television channels offering more choices to media
buyers and consumers of entertainment. Thus, the television broadcasting business, which
started off as a singlegovernment controlled television channel, now has over 300 channels
covering the Indian footprint, resulting in growing ad spends on this medium. Reforms and
proliferation of privateplayers were the key reasons for this rapid growth of the share of
television in the advertisingindustry.
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