India's Advertising Boom: Digital Dominance and AI Revolution

Digital Takes the Crown

The Indian advertising landscape is transforming rapidly, with digital emerging as the undisputed king. A new report reveals that digital advertising, including digital extensions of traditional media, will command a staggering 60% of total ad revenue in 2025, solidifying its reign in the ever-evolving media kingdom.

While digital and TV together will account for a whopping 86% of ad spend, the rise of streaming TV is undeniable. Its share within total TV advertising is projected to reach 12.6%, signaling a significant shift in viewing habits and media investment strategies.

India's Ad Market: A Beacon of Growth

Despite global economic headwinds, India remains a shining star among the top four growth markets worldwide. Global advertising spend surpassed the $1 trillion mark in 2024 and is expected to grow by 7.7% in 2025, fueled primarily by the digital surge.

Contrary to earlier predictions, Indian advertising spending defied expectations, growing by 8.8% in 2024 to reach ₹1.53 trillion. This momentum is set to continue in 2025, with an anticipated growth of 11.5%, driven largely by digital's projected absorption of ₹10,225 crore out of the total incremental ad spend of ₹10,730 crore.

Traditional Media Adapts

While digital flourishes, traditional media is adapting to the changing tides. TV ad revenue is predicted to decline by 1%, while print is expected to hold its ground with a 4% growth. Out-of-home and cinema advertising are also poised for growth, at 8% and 10% respectively.

AI: The Engine of Innovation

The driving forces behind this advertising revolution are AI-powered marketing innovations, the surge in commerce-driven advertising, and the emergence of dynamic formats like programmatic Connected TV (CTV) and AI-powered retail media.

"India is at the forefront of a marketing revolution driven by AI, data privacy, and immersive technologies. As digital crosses 60% of ad spends, we see a shift toward hyper-personalization and AI-driven content," says Prasanth Kumar, CEO, GroupM South Asia.

Key Trends Shaping the Future

The industry is undergoing a period of rapid transformation, with brands recalibrating their strategies in response to evolving consumer behavior and regulatory changes. Key trends include the rise of AI-powered marketing and automation, the surge in retail media, the expansion of CTV, the disruptive force of e-commerce, and the challenges surrounding data privacy and measurement.

The Data and Measurement Dilemma

As AI increasingly influences marketing decisions, the challenges surrounding data privacy and measurement are coming into sharper focus. Integrated measurement frameworks, combining market mix modeling, multi-touch attribution, and clean room analytics, are becoming essential for accurately gauging campaign impact.

"With fragmentation and privacy regulations, traditional tracking methods are becoming obsolete," explains Parthasarathy Mandayam, Chief Strategy Officer - South Asia, GroupM. "Marketers must now combine market mix modeling, multi-touch attribution, and clean room analytics to measure true impact.”

Data Privacy: A Strategic Advantage

Data privacy is no longer merely a compliance issue; it's a strategic advantage. "Marketers are rapidly migrating to data clean rooms—not just for privacy compliance, but to drive richer audience insights and precision marketing," says Priti Murthy, President, GroupM Nexus. She also highlights the role of clean rooms in publisher monetization, enabling them to curate audience segments within privacy-safe environments and unlock new revenue streams.

The Rise of AI-Powered Influencers

AI's influence extends to influencer marketing, with AI-driven influencers redefining storytelling. "AI-driven influencers are redefining storytelling. With their ability to be always-on, brand-safe, and culturally relevant, they offer brands an unprecedented level of personalization and engagement," emphasizes Vinit Karnik, Managing Director, Content, Entertainment, and Sports, GroupM.

Retail Media and Quick Commerce: The New Frontier

Retail media and quick commerce are experiencing explosive growth, reshaping retail strategies and disrupting traditional models. "Retail media has been growing at 40% CAGR and is no longer just an advertising channel—it’s a key driver of omnichannel retail strategies," notes Atique Kazi, President - Data, Performance, and Digital Products, GroupM. "Quick commerce is also disrupting traditional retail models, with brands optimizing for hyper-local, real-time demand.”

In conclusion, despite global economic uncertainty, India's advertising sector is thriving, driven by digital innovation, AI-powered commerce, and the rise of CTV. With retail media, quick commerce, and influencer marketing undergoing rapid transformations, 2025 promises to be a pivotal year for brands and marketers navigating this dynamic and complex landscape.