FMCG & E-com boost Diwali ad spends; auto takes a backseat

As Diwali 2024 unfolded, India’s advertising landscape saw some striking shifts. Digital platforms, in particular, experienced significant growth, even as traditional platforms held their ground in certain sectors, signalling an era where brands are becoming increasingly agile in their media strategies to capture festive sentiment.

According to Deleise Ross, Senior VP at Mudramax, overall ad spending grew by 5-10% this Diwali, with digital advertising surpassing initial benchmarks. She shared that channels such as YouTube, social media, and Connected TV (CTV) saw considerable investment.

"This year, traditional TV ad spending was more sluggish as it saw a decline of 5-7%, this was due to factors like increased OTT adoption and the absence of major sporting events, which in past years have driven high TV viewership," she noted. 

Despite the digital surge, Ross shared that traditional TV remained a mainstay for categories like fast-moving consumer goods (FMCG), which leveraged it to achieve wide reach and establish brand propositions.

“The drop in traditional mediums was due to auto as a category that ended up underspending compared to last year,” she added. 

Furthermore, Amita Srivastava, Vice President at Carat India, shared that digital investments were strong, especially in sectors like e-commerce and tech-driven sectors, but overall market growth was relatively moderate, with a 9-10% rise in total ad spends compared to last year. She said, “Brands maintained a strong online presence, but a large portion of household spending still occurred in traditional retail stores, as evidenced by footfalls and transactions.”

While digital ad spending has grown significantly, Srivastava observed, the shift from traditional to digital platforms wasn’t as dramatic as anticipated. 

Amyn Ghadiali, Country Head at GOZOOP, highlighted that while TV and print continue to play a major role in reaching mass audiences, digital channels are now where consumer engagement truly thrives. He said, “Over 60% of consumers engaged with Diwali ads via mobile devices, compared to just 45% in 2023, underscoring the growing influence of mobile-first strategies.”

E-commerce, tech, and FMCG led the pack

Certain sectors made the most of this Diwali’s ad spending opportunities. Srivastava pointed to consumer durables, electronics, e-commerce, banking, and insurance as sectors that invested heavily in advertising. 

“Home decor saw substantial growth, driven by a trend towards upgrading living spaces—a hallmark of the season. Categories like electronics and white goods also performed well, aligning with consumer tech upgrades during the festive period,” she added.

Retail clients, local advertisers, FMCG players & financial services showed the highest participation in the festive hustle-bustle. Premium goods, gifting & alco-beverages exceeded planned estimations and increased spends by 10-15% 
- Deleise Ross

According to Ghadiali, e-commerce and gaming platforms emerged as heavy spenders this Diwali, led the way and made up about 30% of total ad spend, driven by aggressive discounts and festive sales campaigns.

He shared, “FMCG followed closely, with a focus on Diwali-specific product launches. Travel and hospitality saw good traction, along with real estate (contrary to expectations). Jewellery as a sector again is planning to double its spending as it saw a huge spike. But the automobile was muted considering global dynamics.”

Interestingly, while automobile advertising saw muted growth in some areas, there was still a notable uptick in vehicle sales. Srivastava highlighted that automobile sales surged by 32% in October alone, with two-wheeler sales reaching the 20-lakh mark.

This indicates that while some categories within auto-reduced ad budgets, consumer demand held strong.

Challenges in inventory and ad rates

The festive season also underscored challenges in media planning, with premium digital inventory costs rising sharply. Ghadiali pointed out that the increased cost of digital spots, paired with fragmented targeting, continues to be a significant hurdle for brands and agencies aiming to maximise reach cost-effectively.

Similarly, Srivastava said, “For many brands, optimising campaign timings and ensuring sufficient stock for last-minute demand surges were crucial. Strategic insights from this season emphasise the need for improved inventory forecasting and adaptive media planning to allow flexibility in Diwali campaigns.”

Post-Diwali outlook and strategic takeaways

According to Ross, post-Diwali, there may be a slight decrease in momentum since we enter the holiday season. “This is normally where all the festive clutter comes to a culmination,” she said.

However, Srivastava highlighted that with Black Friday sales and other upcoming events, brands should look to leverage social and influencer marketing to create brand and business uplift.

She said, “Brands that invested in multi-channel campaigns—amplifying traditional print and television efforts with digital tools like social media and influencer marketing—are likely to benefit from longer-term visibility and consumer recall, boosting engagement and creating an impact that extends beyond Diwali.”

Looking beyond Diwali, Ghadiali shared that brands are seeing strong residual effects, with over 55% reporting heightened brand recall and engagement post-festivities. 

Pointing at challenges in inventory and ad rates, he said, “As we look ahead, data-driven planning and flexibility in media buys will be critical to navigating these challenges for 2025. Integration is now more crucial than ever.”

As brands move forward, the lessons from this festive season will shape their approach. They will look toward a more adaptive, cross-channel strategy that leverages data, refines inventory planning, and strategically aligns traditional and digital channels for long-term success.