Indian Cinema Advertising Jumps 25 Percent in 2014 (Study)

Courtesy of PVR Cinemas

Report by global advertising major GroupM shows the sector sustaining growth as multiplexes consolidate.

Indian cinema advertising recorded a healthy 25 percent growth in 2014, touching revenues of $57 million (rupees 3.4 billion). This sector is expected to grow by 20 percent to $68 million in 2015.

The findings come from global advertising major GroupM's biannual advertising expenditure futures report This Year, Next Year, which found that Indian advertising spending reached $7.2 billion in 2014, a 12.5 percent increase over 2013.
According to the study, cinema advertising was considered the "surprise element in the media mix." With cinema advertising growing 12 percent in 2012, the study indicates how this sector is recording a steady growth rate “as multiplex chains consolidate, leading to a more organized and accountable environment.” The report also added: "With technology fueling exhibition and distribution, especially in smaller towns, consumers will get a better viewing experience."

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The last year saw a flurry of deals in the multiplex segment. Reliance-owned Big Cinemas was acquired by South India's Carnival Cinemas for an undisclosed amount. Mexico's Cinepolis – the only foreign player in the market – acquired the Fun Cinemas chain for a reported figure of $77 million. Back in 2012, New Delhi headquartered PVR Cinemas became India's largest cinema chain when it acquired Mumbai-based rival Cinemax India, buying a majority stake for $745 million.

Looking at other advertising sectors, GroupM's study indicated that digital media continued to show substantial growth, recording a 35 percent average over the last two years. In 2014, digital advertising hit $567 million and is estimated to increase by 37 percent in 2015 to $776 million.

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Television advertising is expected to grow slightly higher at 16 percent in 2015, compared to 2014's 15 percent growth. In 2014, advertising revenues touched $3.2 billion and is expected to grow to $3.7 billion in 2015.

Sports continues to be a growth driver backed by major events lined up this year, notably the Cricket World Cup which will air on News Corp.'s Star Sports network. With India defending champions, viewer interest is expected to be high.

This Year, Next Year is part of GroupM's media and marketing forecasting series drawn from data supplied by holding company WPP's worldwide resources in advertising, public relations, market research and specialist communications.