India’s media and entertainment (M&E) sector is expected to recover from current levels and show 33% growth in 2022, following a 20% contraction in 2021, according to a new report from KPMG India.
It noted that India was already experiencing a slowdown in economic activity even before the COVID-19 outbreak in March, with the country’s real GDP dropping from 6.1% in 2018 to 4.2% in 2019. The start of the global pandemic and the ensuing lockdown dealt a severe blow to the Indian economy.
Businesses will be encouraged to invest in credible digital execution models as consumers migrate online faster thanks to the “weak economy” that has emerged thanks to the COVID-19 pandemic. Digital media ad spend is expected to overtake TV by 2021, with digital likely one of the only M&E segments to continue to grow double digits over the coming year.
In 2020, TV was the largest segment in terms of overall revenue and advertising revenue, growing 9% overall. Digital, however, showed an overall growth of 26% in 2020, with OTT advertising increasing by 24%. OTT subscriptions have increased by 47% and are expected to overtake as they have become the platforms of choice during the lockdown.
Advertising revenues are also expected to be severely affected in 2021. Digital is again the only category that is expected to grow and overtake television. Printing is expected to drop 46% in 2021. In 2022, KPMG expects printing to recover but remains below the numbers it has in 2020. Likewise, TV is expected to drop 17% before return to INR 258 billion (US $ 3.5 billion) in 2022 (INR 4 billion or US $ 54.4 million less than in 2020).
The M&E sector is expected to rebound in FY22 with 33.1% growth from FY21 to reach a size of INR 1.86 trillion (US $ 25.3 billion), at a CAGR 3.2% over FY20-22, with games and digital being the fastest. growing segments.
KPMG analysts noted that there may be a dichotomy in the experiences of rural and urban India, as the former appears to show signs of rapid recovery relative to urban centers with encouraging growth in demand and sales. fertilizers, tractors and two-wheelers.
“The distinction between M&E segments has become more pronounced with the experience of foreclosure. Marketing spending has shifted significantly to digital media and away from traditional segments like print, radio and to some extent television, ”said Satya Easwaran, Partner and Head of Technology, Media and Operations. telecommunications at KPMG in India.
The report titled One year outside the scenario: time for resilience is KPMG India’s twelfth edition of its Media and Entertainment report.
From KPMG India, ETBrandEquity