What 2025 holds for India’s Digital Advertising Ecosystem?

Authored by Mayura Nayak, Co-Founder & CRO, Huella Services

India's digital advertising landscape is rapidly transforming. Going by recent data, Google, Meta, Amazon and Flipkart reportedly had a collective advertising revenue in excess of Rs.60,000 crore during 2023-24 witnessing a 9% YOY growth. These are encouraging signs for India’s internet advertising market.

India reportedly is now the fastest-growing digital ad market in the Asia-Pacific region and second in terms of global rankings. The rapid stride taken by India's digital ad market have been accelerated by technological advancements, shifting user behaviour, and evolving market dynamics. The government’s push to enhance digital infrastructure is another factor that is fuelling this growth. 

In the New Year, the rapidly growing digital ecosystem will reshape the overall digital advertising landscape in many ways. As internet penetration surges and mobile usage soars, we will witness a mix of opportunities and challenges that will drive innovation in the world of digital advertising.

Digital ad monetization has become key to every brand’s revenue strategy. Finding the perfect balance of reaching a large and targeted audience through various digital platforms and driving customer engagement is the key to an effective digital ad monetization strategy. As we move forward, I have listed down a few trends that will take centre stage in driving effective digital ad monetization. These are also signposts pointing to where the industry is headed in 2025.

Connected TV (CTV’s) continued ascent: Connected TV (CTV) was the stand out story for digital advertising in 2024 and will continue to rule the roost. India is witnessing a continued growth in CTV. From 22 million CTVs in 2022, India is expected to witness 45 million CTVs by the end of 2025. This growth represents a significant shift in viewing habits, as audiences increasingly move away from traditional linear TV, creating new opportunities for advertisers. In 2023, CTV ad spending in India reached $86 million, and projections suggest that this figure will soar to $395–500 million by 2027, reflecting an impressive compound annual growth rate of 31–47%. With more ad units and innovative formats on the horizon, CTV is solidifying its position as a preferred medium for advertisers seeking immersive and impactful campaigns.

Quick Commerce and the attention economy: We are witnessing a convergence of  quick commerce and digital advertising. According to industry estimates, the Indian quick commerce industry is currently valued at USD 3.34 billion in 2024 is expected to grow at a rate of 4.5% (CAGR) to $9.95 billion by 2029. The rapid expansion of quick commerce will continue to drive innovation in the digital advertising world with social media platforms introducing new shopping features, advertisers are increasingly shifting towards integrating ads with direct purchasing options. Shoppable ads and in-app purchases are offering brands a higher exposure for brands to conversion while also enabling a seamless experience for consumers to buy products directly from ads. Social commerce and video commerce will finally become mainstream while blurring the line between entertainment and e-commerce. This growth reflects consumers' increasing demand for ultra-fast delivery services, reshaping the e-commerce landscape and creating new battlegrounds for brand visibility.

Data-Driven creativity and AI-laden personalisation of messaging: With storytelling getting increasingly personalised, actionable data will redefine how brands create and deliver messages. Expect to see campaigns that feel personal, intuitive, and precisely timed. This will also lead to  how effectively we use hyper personalisation will remain the key. The marriage of data driven creativity and AI-laden hyper-personalisation will help advertisers to create highly targeted campaigns based on user behaviour, location, preferences, and real-time data. The level of precision that will help brands now to tailor messages and achieve personalisation that was previously unachievable.

Enhanced measurement tools: Last but not the least, advertisers want their monies well spent. With advertisers demanding greater accountability, we will see significant advancements in tools that measure and validate campaign success, ensuring every dollar spent delivers tangible outcomes.

The past year has laid a robust foundation, but the true test will come in 2025. Today’s advertisers aren’t just interested in where users are; they want to know what they’re doing—whether it’s consuming regional content or engaging with emerging platforms. As first-party data becomes richer and more actionable, it naturally elevates the value of these audiences, transforming them into premium segments for brands. For marketers and platforms alike, the focus will be on staying agile, embracing innovation, and aligning with where audiences are directing their attention. Those who can navigate this landscape with foresight and precision will find themselves leading the charge in an industry poised for its next big leap.

DISCLAIMER: The views expressed are solely of the author and Adgully.com does not necessarily subscribe to it.