Indian Entities Spent $1.6 Billion On Facebook And Google Ads In 2018-19
Indian entities increased their digital ad spends on Facebook Inc. and Google in fiscal 2018-19, according to filings available at the Registrar of Companies.
Online ad revenue of Facebook and Google in India rose to Rs 11,500 crore in FY19, the filings reviewed by BloombergQuint showed. Of this, the search engine behemoth clocked Rs 9,203 crore from ads compared to Rs 6,389 crore in the previous fiscal while the social media giant garnered Rs 2,233 crore.
Facebook's gross advertisement reseller revenue wasn’t available for FY18 as it started reporting ad revenue from FY19. The social network said its ad revenue includes ad spends by Indian entities on Instagram, Messenger and third-party affiliated websites or mobile applications.
With over 1.3 billion people and about 500 million internet users, digital advertising in India—the fastest-growing advertising market in the world—is expanding at a faster pace than any other medium. According to a report by Dentsu Aegis Network Ltd., online ad spend is expected to reach Rs 28,249 crore by 2022—up from Rs 13,683 crore in 2019.
Google and Facebook together had a combined market share of 68 percent in India’s online advertising space, according to a SeekingAlpha report published in 2018. Both are now vying to increase this market share amid competition from the likes of Amazon.com Inc. and Walmart Inc.-backed Flipkart.
Revenue Of Indian Arms
Facebook Indian Online Service Pvt. Ltd., the social media firm’s Indian arm, said it pays back the ad inventory cost to the group company, which was around Rs 1,969 crore in FY19. The remaining Rs 263 crore was counted as net revenue of the Indian arm.
Similarly, Google India Pvt. Ltd. showed Rs 1,097 crore as ‘net sales’ from advertisements in the country, according to its RoC filing.
Facebook India’s overall revenue rose 71 percent year-on-year to Rs 892 crore in FY19 and profit jumped 84 percent to Rs 105 crore, the filing said.
Google India’s overall revenue more than halved to Rs 4,147 crore in FY19 due to a change in accounting standards. Its profit, however, rose 16 percent to Rs 473 core.