2024 the year of EV brands revving up media spending?

In 2024, the Electric Vehicle (EV) category is poised to dominate media expenditures with a surge in launches and significant contributions to advertising expenditure (AdEx), according to industry leaders.

India witnessed an impressive 49.25% year-on-year increase in EV sales during 2023, according to the Federation of Automobile Dealers' Association. This surge has propelled the country's electric vehicle market size to an anticipated $19,980 million by 2028, exhibiting a remarkable Compound Annual Growth Rate (CAGR) of 69% during 2023-2028.

The automotive landscape in India is poised for over 10 EV car launches in 2024, led by key players such as Tata, Mahindra, and Maruti. With Original equipment manufacturers (OEM)s, startups, and international entities eagerly eyeing India's burgeoning EV market, there is an anticipation of a substantial uptick in media spending.

According to GroupM's TYNY end-of-year forecast report for 2023, the global ad spending landscape will be influenced significantly by new launches, particularly in the EV category.

Vishal Patankar - executive client director, Landor says players like Tatas, Mahindras, Olas, and Acer have risen sharply given the Central government’s support for the EV industry. He says the advertising landscape in the EV sector is naturally expected to grow as OEMs aim to showcase their dominance in the market.

Atin Wahal, executive director, L&K Saatchi & Saatchi, emphasises on the essential role of advertising in educating consumers about EVs. He states, “Investment in advertising is imperative, making the category a very serious contributor to overall media spends."

EV ad spend forecasts

Projections for EV sector media spending indicate a noteworthy increase from $160 million in 2020 to an estimated $260 million in 2024, states Patankar. Launching EVs incurs higher costs not only in advertising but also due to considerations in infrastructure, safety, innovation, and technology.

He says given the relatively higher cost of EVs compared to traditional petrol or diesel cars, advertisers face the challenge of investing additional resources in effectively communicating the benefits of the EV category and persuading the consumer.

EV ad volumes in 2023 vs 2022

According to TAM, EV car ad volumes increased across mediums. Ad volumes for Cars (EV) observed impressive growth of 4 Times on Television Medium during 2023 over 2022. Additionally, print medium witnessed a remarkable growth in ad space of almost 4 Times for the category in 2023 compared to 2022. Cars (EV) saw a major surge of 2 folds on Radio Medium in 2023 over 2022.

Tata Motors dominated TV ad space, while MG Motors led in print ad volumes. Tata Motors claimed the first position with a 26% share of ad volumes compared to its fourth position in 2022. There were five exclusive advertisers present on TV during 2023 over 2022, with the top two advertisers covering 43% share of ad volumes for the category.

MG Motors was the top advertiser in the print medium for Cars (EV) category with a 51% share of ad space in Y 2023. PCA Automobiles and BMW India were exclusive advertisers during Y 2023 over Y 2022.

However, there was a sharp decline in ad spends from the two-wheeler category on TV suggests TAM. The Two-Wheelers (EV) category witnessed a degrowth of 16% in ad volumes during 2023 over 2022 on Television Medium. Whereas, on Print Medium, the category observed significant growth of 91% in ad space during 2023 over 2022. On Radio, ad volumes of the two-wheelers (EV) category observed growth of 32% in Y 2023 compared to Y 2022.

On TV, Okaya EV and Ather Energy maintained their 1st and 2nd ranks during 2023 over 2022. There were 5 exclusive advertisers present in 2023 compared to 2022 on TV Medium.

On print, Ather Energy was the leading advertiser for the two-wheelers (EV) category with a 28% share of ad space in 2023. This year also saw six new advertisers enter the category list on print compared to 2022. Also, the top 10 advertisers collectively added a 92% share of ad space during the same period.

Shashank Srivastava, senior executive officer, marketing and sales at Maruti Suzuki India says, the typical media spend for a regular car launch ranges from 60-70 crore for an automobile brand. However, for EVs, this figure is expected to be significantly higher. The brand is gearing up for a significant launch in the EV space in the coming few months.

A great example is Tata, who despite having the legacy and brand name, decided to market its EVs under a whole different brand name ‘Tata.ev’. “That was an absolute game changer for Tata,” notes Patankar.

Tata also came on board as the official partner of IPL in 2022 for a period of two years. In the 2023 IPL, they leveraged IPL’s media mix extensively for their Tiago.ev. The group had reportedly spent more than Rs 600 crore or two years of title sponsorship.

Sanjeev Jasani, COO of Cheil India, who has onboarded one 4-wheeler client and another 2-wheeler client says the impact on business has been significant. “The EV category is gearing up for substantial media spends. As charging infrastructure grows, consumer awareness peaks and technology advances, the advertising landscape will witness a surge for sure,” he says.

Kulvinder Ahluwalia, CEO of FCB ULKA adds as the category evolves, EVs have the potential to scale up business for agencies as well as the entire ecosystem.