The Union Budget 2024 is expected to be a crucial one for the Indian economy as it will set the tone for the government’s vision and priorities for the next five years, as it is the first full-fledged budget after the 2023 general elections.
One of the sectors that is eagerly awaiting the budget announcements is the digital marketing industry, which has witnessed a tremendous growth in the past few years, thanks to the rapid adoption of digital technologies, platforms and channels by businesses and consumers alike. According to a report by Dentsu, the digital advertising market in India grew by 15.3% in 2023, reaching Rs 23,673 crore, and is expected to grow by 20% in 2024, reaching Rs 28,418 crore.
The digital marketing industry is not only a significant contributor to the country’s GDP, but also a key enabler of innovation, entrepreneurship, employment and social impact. The industry has the potential to transform various sectors such as e-commerce, education, healthcare, agriculture, MSMEs and more, by helping them reach, engage and convert their target audiences online.
However, the industry also faces some challenges and bottlenecks that need to be addressed by the government in order to unleash its full potential and create a conducive ecosystem for its growth and development. Some of the key expectations of the digital marketing industry from the Union Budget 2024 are:
Higher spending on digital infrastructure
The digital marketing industry depends heavily on the availability and accessibility of digital infrastructure, such as internet connectivity, bandwidth, data centres, cloud services, cybersecurity and digital public goods. The government has taken some commendable steps in this direction, such as launching the National Digital Communications Policy 2023, the National Broadband Mission, the BharatNet project, the National Cyber Security Strategy and the Open Network for Digital Commerce (ONDC).
However, there is still a lot of scope for improvement, especially in terms of bridging the digital divide between urban and rural areas, ensuring affordability and quality of internet services, enhancing data privacy and security, and promoting interoperability and standardisation of digital platforms. The industry expects the government to allocate more funds and resources for building and strengthening the digital infrastructure in the country, and also provide incentives and subsidies for the private sector to invest and participate in this domain.
Rationalisation of taxes and duties
The digital marketing industry is subject to various taxes and duties, such as Goods and Services Tax (GST), Equalisation Levy, Customs Duty, Income Tax and more, which increase the cost of doing business and create compliance issues. The industry also faces ambiguity and inconsistency in the interpretation and implementation of these taxes and duties, especially in the case of cross-border transactions and digital services.
The industry expects the government to rationalise and simplify the tax regime for the digital marketing industry, and provide clarity and uniformity on the applicability and scope of these taxes and duties. The industry also hopes that the government will reduce or waive off some of the taxes and duties, such as the 6% Equalisation Levy on online advertising services, which is seen as a discriminatory and unfair tax on the digital economy.
Promotion of digital skilling and talent development
The digital marketing industry is a highly dynamic and competitive one, which requires a constant upgradation of skills and knowledge to keep pace with the changing trends and technologies. The industry also faces a shortage of qualified and experienced talent, especially in the areas of data analytics, artificial intelligence, machine learning, content creation, performance marketing, social media marketing and more.
The industry expects the government to support and promote digital skilling and talent development initiatives, such as providing tax benefits and subsidies for digital education and training programs, creating digital literacy and awareness campaigns, establishing digital skill centres and hubs, and facilitating industry-academia collaborations and partnerships. The industry also urges the government to recognise and certify the digital marketing profession and create a standardised framework for its accreditation and regulation.
Recognition and support for digital marketing startups and MSMEs
The digital marketing industry is home to a large number of startups and MSMEs, which are the backbone of the industry and the drivers of innovation and disruption. These startups and MSMEs offer a wide range of digital marketing solutions and services, catering to the diverse and evolving needs of various sectors and segments. However, these startups and MSMEs also face several challenges and hurdles, such as lack of access to capital, credit, technology, infrastructure, mentorship, market and policy support.
The industry expects the government to recognise and support the digital marketing startups and MSMEs, and provide them with a conducive and favourable environment for their growth and survival. The industry also hopes that the government will extend the benefits and schemes of the Startup India and the MSME Development Act to the digital marketing startups and MSMEs, and also create a dedicated fund and platform for their funding and networking.
“The digital marketing industry is at the forefront of the digital transformation of the Indian economy and society, and has a huge potential to create value and impact for various sectors and segments. The Union Budget 2024 is a great opportunity for the government to acknowledge and appreciate the role and contribution of the digital marketing industry, and to provide it with the necessary support and stimulus to grow and thrive. We hope that the government will address the key issues and challenges faced by the industry, and will announce some progressive and pragmatic measures and policies that will boost the confidence and morale of the industry, and will enable it to achieve its aspirations and goals.”
Inclusion and representation of the digital marketing industry in policy making
The digital marketing industry is a vital and vibrant part of the Indian economy and society, which has a significant impact and influence on various aspects of the country’s development and progress. However, the industry often feels that it is not adequately represented and consulted in the policy making process, and that its views and suggestions are not taken into consideration by the government and the regulators.
The industry expects the government to include and represent the digital marketing industry in the policy making process, and to engage and consult with the industry stakeholders on a regular and timely basis. The industry also requests the government to create a dedicated ministry or department for the digital marketing industry, or to assign a nodal agency or authority for the industry, which can act as a single point of contact and coordination for the industry.
