'Advertising spends may keep growing in high single digits'

Mumbai: India's advertising expenditure growth is expected to remain in high single digits in 2026 amid cautious optimism among advertisers, who are spending cautiously this festive season as businesses continue to recover from the aftereffects of the Gulf war, a top ad industry executive said.

"There is cautious optimism. Advertisers were initially enthusiastic about spending more, but as plans have taken shape, I have seen some caution and delays in approvals," Lalatendu Das, chief executive, South Asia, at Publicis Media, told ET.

He expects this festive season to be broadly on a par with, if not better than, that last year, which benefited from a cut in goods and services tax on many products and services. "However, external uncertainties could affect actual spending," he cautioned.


The festive season is a major business driver for automobiles, electronics and gadgets, beauty and personal care, and home decor. India's annual advertising expenditure (adex) is estimated at Rs 1.5 lakh crore to Rs 2 lakh crore, with an ad-to-GDP ratio of 0.5%.

Publicis Media led India's new business rankings in the first half of 2026, securing $218 million in total new business, including retentions, and $157 million in net new business, excluding retentions, according to COMvergence, a research and data consultancy.

"The more interesting development is the shift in expenditure. Money is moving from large celebrity-led productions towards creators, and quick commerce is attracting investment from categories such as food, beauty and clothing," he said.

CTV is another growth area, combining television's co-viewing advantage with the convenience of taking action on a phone. "The integration of content and commerce is important, although frequency capping remains a challenge on some platforms," he said. Clients increasingly expect media agencies to move beyond media efficiency to solving business problems, Das said. "It is not enough to offer a better CPM (cost per 1,000 views) or a cheaper media deal," he said.

Clients also want agencies to future-proof their businesses and explain how they will remain relevant three years down the line.

Das said advertising expenditure as a percentage of GDP was the wrong measure, despite India's ad-to-GDP ratio being lower than that of advanced markets such as the US and Europe. "What we need to look at is advertising expenditure in relation to GDP per capita. That is the more relevant measure," he said.

India has 50-60 million people with purchasing power comparable to developed-market consumers, another 100-140 million comparable to middle-income countries, and a larger low-income population."The challenge is that we may be reaching people through advertising who cannot afford the products being advertised. That does not mean lower-income consumers do not buy anything. They buy smaller packs and affordable products, such as Rs 2 shampoo sachets or Rs 5 chocolate products," he said.