MAM
Digital & TV steer ad industry’s recovery to pre-pandemic levels in 2021: dentsu
MUMBAI: India has emerged as one of the top five markets with high year-on-year growth rate in advertising spends, said dentsu in its latest Global Ad Spend Forecast June 2021. After suffering a steep 12.9 per cent decline in 2020, the ad spend is expected to bounce back with 10.8 per cent growth in 2021, according to the report.
The forecast suggests the overall ad spend will reach $ nine billion this year, and expand further by 12.4 per cent in 2022. The growth will largely be led by Television and Digital, as Print, Cinema, OOH and Radio are expected to take a longer time to recover.
According to the data, Television continues to remain the most popular and resilient media in India, retaining a 40.9 per cent share in ad spend despite the pandemic. The medium also showed a 7.7 per cent spike in growth, as compared to the 2020 spend. Digital’s share of spend has grown rapidly, from 20.0 per cent in 2019 to 29.4 per cent in 2021, and is expected to reach 32.7 per cent by the end of 2022
India in top 5 mkts-denstu
The bi-annual report based on data from 59 markets, anticipates a full recovery for the global ad market in 2021, with spends exceeding pre-pandemic levels sooner than was previously forecast.
While 2020 remains the weakest performing year since the global financial crisis, the decline in growth during 2020 has improved since the January 2021 forecast from -8.8 per cent to -7.2 per cent. The pandemic-induced decline in global advertising spend during 2020 has also proved less severe than anticipated, it states. The overall ad market outlook for 2021 shows recovery with 10.4 per cent growth and a spend of $634 billion, which represents an improvement of 4.6 percentage points over January 2021 prediction.
Ad-spend in APAC
Overall, the ad spend in APAC is expected to grow by eight per cent, with Australia and India showing higher growth rates in 2021 compared to other countries. In APAC, the 6.2 per cent rise in digital spend last year is likely to grow by 12.8 per cent in 2021 to reach $124.5 billion, representing a 54 per cent share of total ad spend.
Regional live events such Tokyo Olympics and Paralympics Games will remain significant drivers of growth in Linear TV ad spend in APAC (3.9 per cent increase in 2021 to reach $59.2 billion). The report also indicates a shift towards CTV (Connected TV) and OTT (Over The Top). With audiences moving more towards digital media consumption, Linear TV spend will remain below pre-pandemic levels until beyond 2021.
With gradual lifting of restrictions on social activities, OOH will bounce back post impact of the pandemic, rising 7.5 per cent in 2021 in the region. Cinema has a slightly longer recovery, with a further decline in 2021 (-5.0 per cent) but expected to bounce back in 2022. Radio will also see growth (4.3 per cent) in 2021.
While most channels will return to growth in 2021 (Cinema in 2022), Print is seeing a slight decline in 2021 (–2.7 per cent) and expected to continue declining in 2022, as it evolves towards new modes of digital delivery.
Meanwhile, government spending remained a key growth area, supporting the Covid vaccine rollout and other related initiatives. In APAC’s key markets, the travel and transport sectors, will still be affected by the uncertainty of the past year and see a muted increase in demand (4.9 per cent), while Media & Entertainment is forecast to see growth (9.7 per cent).
dentsu International APAC CEO Ashish Bhasin said, “It is promising to see a return to growth in the APAC region with two of our markets in the top five contributors of ad spend growth; China and Japan. While China continues to see strong levels of growth driven by Digital and OOH, Japan’s growth will be buoyed by events like the 2020 Olympic & Paralympic Games, and the House of Representative elections and the advertising spend associated with it, particularly in TV.
By market, the top five contributors to the $ 59.7 billion of growth in incremental ad spend during 2021 will be the US, China, UK, Japan and Australia. The US share of ad spend remains significantly above all other markets in 2021. The highest growth rates in 2021 are forecast to come from spend in India, Canada, the US, Australia and the UK.
Media APAC CEO & Media Singapore MD Prerna Mehrotra said, “We are optimistic that the region will bounce back to positive growth in ad spend, with some channels likely boosted higher than pre-pandemic levels. The main drivers behind the growth is economic recovery, with the APAC GDP set to increase by 7.3 per cent, and a stronger-than-ever push to digital marketing.”
Starting a business is one of the most financially demanding transitions a person can make. In the early months, expenses are immediate and often unpredictable, while revenue streams may take time to stabilise. For first-time entrepreneurs, securing small business loans can feel like a paradox: lenders expect a clean financial track-record before approving a loan, but the business cannot establish that track record without funding. Understanding the start-up lending environment in India and knowing the realistic funding options make this process far less daunting, allowing entrepreneurs to plan strategically.
Why Traditional Business Loans Are Harder for Start-ups
Most financial institutions require a minimum business vintage of 2 to 3 years before approving a term loan. This is because the first two years of operations carry the highest risk of failure. For start-ups less than 12 months old, traditional loan options are limited, and lenders often ask for substantial collateral to mitigate risk.
The vintage requirement is not arbitrary. Businesses that have survived their first two operating cycles demonstrate market viability, which significantly lowers the lender’s risk. Until this milestone is reached, entrepreneurs often rely on bootstrapping, personal savings, or alternative financing to build a stable business foundation. Understanding this reality helps first-time entrepreneurs set practical expectations when seeking funding.
Government-Linked Schemes for Startups
India offers several government-backed schemes to support first-time entrepreneurs. One such scheme is the Pradhan Mantri Mudra Yojana (PMMY), which provides collateral-free loans for micro and small enterprises in three categories:
● Shishu: up to Rs. 50,000
● Kishore: Rs. 50,000 to Rs. 5 lakh
● Tarun: Rs. 5 lakh to Rs. 10 lakh
These loans are available through eligible lending institutions, making them suitable for early-stage businesses. For first-time entrepreneurs, a Mudra loan not only provides initial working capital but also helps establish a credit history. Repaying a Mudra loan on time strengthens the entrepreneur’s profile and increases the chances of securing larger loans in the future.
Using Personal Loans to Fund Early-Stage Needs
When business loan eligibility is not yet established, a personal loan can serve as bridge funding. These loans are assessed on the individual’s credit profile and income rather than the business’s financial history, making them accessible to salaried individuals or those with a strong personal credit record.
Personal loans have limitations: the loan amount is capped based on personal income, and the interest rate is typically higher than secured business loans. Nevertheless, taking out a personal loan during the first 12 to 18 months can provide crucial support as the start-up builds its financial profile. It is especially useful for covering immediate expenses such as inventory, marketing, or office setup costs.
Alternative Financing Options for Startups
For start-ups that are not yet eligible for traditional business loans, other financing options are available through financial institutions. Many lenders offer startup-focused or small-business loans designed for early-stage businesses. These loans evaluate the entrepreneur’s personal credit profile, business plan, and projected revenue rather than relying solely on business vintage. Financial institutions such as Tata Capital provide these loans with minimal documentation and fast disbursal, enabling entrepreneurs to manage operational expenses, purchase equipment, or fund early growth initiatives without pledging collateral.
Some lenders also offer flexible loan amounts, quicker approvals, and streamlined processes, making them well-suited for first-time entrepreneurs. Exploring these options early allows start-ups to access working capital while gradually building a credit history that will support larger loans in the future.
Building the Right Financial Profile Before Applying
For entrepreneurs planning to apply for a business loan in 12 to 18 months, the preparation period is critical. Key steps include:
● Filing Income Tax Returns (ITRs) consistently and accurately from the first year
● Maintaining a clean current account with regular deposits and no overdraft patterns
● Keeping the promoter’s CIBIL score above 750
Lenders assess start-ups by examining these signals. Entrepreneurs who maintain financial discipline from the start will have stronger loan applications after two years. Additionally, tracking cash flow and avoiding irregular withdrawals can further enhance the business’s credibility.
Collateral-Based Options for Larger Requirements
Startups requiring larger amounts beyond government schemes can consider loans against property. These loans allow entrepreneurs to access larger amounts of funding at lower interest rates, as the property secures the lender’s risk.
This option carries significant risk: using personal or family assets as collateral can result in a loss if the business does not perform as expected. Such loans should be considered only when the business plan is validated, the entrepreneur has clear cash flow projections, and the repayment strategy is realistic. Careful assessment of risk versus reward is essential before pledging assets.
Practical Steps to Strengthen Your Loan Application
To maximise the chances of approval, entrepreneurs should:
● Maintain accurate financial statements, bank records, and GST returns.
● Avoid over-borrowing; apply for realistic amounts that match business needs.
● Keep personal and business credit profiles in good standing.
● Explore lenders that offer startup-friendly products.
● Be transparent and complete in all documentation.
Taking these steps early ensures a smoother and faster loan process when the business is ready for formal financing. A well-prepared application reduces processing delays and demonstrates professionalism to the lender.
Conclusion
First-time entrepreneurs often face a funding gap in the early stages, but it is usually smaller than it appears. Maintaining clean banking records, filing ITRs consistently, and exploring personal loans, government schemes, and alternative financing options help build a strong financial profile. Entrepreneurs who plan systematically from day one are better positioned to access formal credit sooner, giving their start-ups financial stability through small business loans.
The ideal time to start building a credit-worthy business profile is the very first month of operations, not when applying for a loan. By understanding available funding options and acting proactively, first-time entrepreneurs can confidently apply for a business loan and set their businesses on a path to long-term growth.
