India’s E-commerce Giants Elevate Advertising to Core Business
Leading e-commerce enterprises in India are transforming advertising into a fundamental aspect of their operations. Industry titans such as Amazon, Flipkart, and Myntra collectively reported an impressive ₹15,573 crore in ad revenues for the fiscal year 2025.
This figure signifies a robust 26% increase from the previous year, highlighting the escalating significance of retail media as a primary catalyst for growth.
Amazon Seller Services emerged as the frontrunner, amassing ₹8,342 crore—an ascent of 25% compared to FY24. Flipkart Internet followed closely with ₹6,317 crore, reflecting a 27% uptick, while Myntra Designs achieved ₹914 crore, marking a 28% rise.
Ad Revenue as a Percentage of Total Income
- Amazon Seller Services: 28%
- Flipkart Internet: 31%
- Myntra: 15%
In an industry characterized by narrow profit margins, advertising has emerged as a lucrative buffer, significantly contributing to overall profitability.
Retail media, indicative of advertisements served on shopping platforms utilizing consumer data to target purchases at crucial decision points, has gained noteworthy traction globally.
WARC Media anticipates Amazon’s retail media revenues to soar to $60.6 billion in 2025, with further growth projected to $69.7 billion by 2026.
Presently, Amazon stands as the third-largest player in the global digital advertising landscape, trailing only Alphabet and Meta.
In the Indian context, Google and Meta maintain a commanding lead. Google India’s advertising revenue surged by 11% in FY24, reaching ₹31,221 crore, while Meta India’s revenue increased to ₹22,730 crore from ₹18,308 crore—collectively surpassing the ₹50,000 crore milestone for the first time. The financial disclosures for FY25 by these companies remain pending.
“Retail media has become an integral component of the market. The growth potential is vast, showing scant signs of deceleration. Our growth trajectory is consistent with the trends observed over the past one to two years,” remarked Gulshan Verma, Director of Amazon Ads India, during a recent discussion.
The ascent of e-commerce advertising mirrors the broader expansion of online retail. Bain & Company estimates that India’s e-retail market will reach $60 billion by 2024, encompassing 270 million shoppers.
Projections suggest a market expansion to between $170 billion $190 billion by 2030, with annual growth rates exceeding 18%.
According to Dentsu, the paradigm of retail media has shifted from a strictly performance-based approach to a more holistic branding tool. This evolution is largely powered by the wealth of first-party data from e-commerce platforms.
Video-led formats are ushering in what is termed “Retail Media 2.0,” fostering comprehensive campaigns across the marketing spectrum. Sectors such as fast-moving consumer goods and consumer durables, particularly electronics, dominate the advertising expenditure.
Analysts predict that additional categories will increasingly engage as brands seek to harmonize online and offline strategies for enhanced targeting.
With advertising constituting as much as a third of their revenues, e-commerce platforms are evolving into formidable media channels, vying directly with search engines, social platforms, and video services for advertising budgets.
Source link: M.economictimes.com.
