India's digital advertising market is experiencing robust growth and is projected to maintain a strong upward trajectory in the coming years. According to a recent report by Bain & Company, the Indian digital advertising market is expected to grow at a compound annual growth rate (CAGR) of approximately 15% between 2024 and 2029. This growth will propel the market value to an estimated $17-19 billion by 2029.
Several factors are contributing to this impressive expansion. A primary driver is the increasing digital consumption in India, largely fueled by mobile devices. Mobile devices account for a substantial 70-80% of digital ad spending, exceeding the global average. Indians are spending an increasing amount of time on their mobile devices, with daily usage rising from 3.7 hours in 2019 to 4.8 hours in 2023. This surge in mobile usage creates more opportunities for advertisers to reach their target audiences.
Another key factor is the diversification of digital advertising channels. While Google and Meta have traditionally dominated digital ad spending, brands are now allocating their budgets across a wider range of platforms, including news apps, over-the-top (OTT) services, e-commerce platforms, quick commerce apps, and gaming apps. This diversification allows for more targeted and effective advertising campaigns.
The rise of video formats is also playing a significant role in the growth of digital advertising. In-app video formats are expanding rapidly and are projected to increase their market share by 6-8 percentage points over the next five years. Connected TV (CTV) is another emerging channel, with the number of households owning smart TVs doubling to 45 million between 2022 and 2024. Although CTV currently holds a smaller share of the market, its growing traction suggests substantial future potential.
Small and medium enterprises (SMEs) and direct-to-consumer (DTC) brands are also contributing significantly to the digital advertising boom. Their share of digital ad spending is expected to rise from 37% in 2024 to over 40% by 2029. Many of these advertisers are mobile-first and heavily reliant on e-commerce, further driving the growth of digital advertising.
Furthermore, the increasing penetration of smartphones and affordable internet access has led to a significant shift in consumer behavior, with more individuals accessing online platforms for information and shopping. This transition has prompted advertisers to invest heavily in digital channels, particularly social media, video content, and search engine marketing.
The integration of artificial intelligence (AI) and machine learning (ML) into advertising processes is also transforming the landscape. These technologies enable automation, real-time bidding, and hyper-personalization, leading to improved targeting and return on investment.
Overall ad spends in India are projected to increase from 0.4% of GDP to approximately 0.5% by 2029, marking one of the fastest growth rates globally. While this growth is significant, India still lags behind countries like China and Japan in terms of the ad-to-GDP ratio, indicating further potential for expansion.
In 2024, digital ad spending reached ₹45,292 crore, commanding 42% of the total advertising spend. This figure is projected to reach ₹52,992 crore in 2025, capturing 44% of the market share. Other estimates suggest that the digital ad market could reach ₹62,045 crore by 2025, potentially constituting approximately 55% of total ad spending.
The digital advertising market in India is poised for continued growth, driven by increasing internet penetration, the proliferation of mobile devices, the rise of video content, and the adoption of advanced technologies like AI and ML. As brands adapt their digital advertising strategies to meet evolving consumer behavior, the market is expected to reach new heights in the coming years.
