Colvyn Harris
There are mixed signals from the advertising and media industry this year. The volume of commercial time on broadcast satellite channels and radio has grown; so have the cubic centimeter-space devoted to ads in print. But the industry is watching to see if this translates into better values as well. “We think there should be a growth in values as well despite competitive pressures among TV channels. Also, there are several dynamics at play in the market,” says Sam Balsara, CMD, Madison Worldwide.
If industrial growth has been showing signs of moderating over the past few months, advertising honchos don’t see it getting reflected in their business. Rather, they’re expecting a pick-up in activity. “We are growing as a nation despite the pressures such as inflation and slowdown. There’s a huge hunger among new advertisers and existing players to step up the tempo on their brand building activities,” says Colvyn J. Harris, CEO, JWT.
He may be right. Consider: the Board of Control for Cricket in India’s Indian Premier League (IPL) has already put in over Rs 300 crore of advertising money into the system via Sony Entertainment Television. Amazingly enough, the fortunes of general entertainment channels (GECs) began soaring around the same time of the IPL. “Normally, cricket tends to suck viewership and money away from other forms of entertainment; this time, we saw the viewership pie grow across all channels. It’s an amazing time: the existing market leaders have continued to maintain ground, and the new players are growing the market,” says Balsara. Normally, a stock market financial services firms.
Prasoon Joshi
But even that has not been the case this year. Max New York Life, for instance, will pump up to Rs 100 crore in its marketing and media activities. “None of our clients—and we handle all the market leaders—have indicated any sense of caution or cuts in its spends,” says Harris. That’s good news for an industry that was set back in 2007— it recorded a modest increase of 3.5 per cent in 2007 over 2006 against a more robust growth of 23.5 per cent in 2006 over the pervious year. This was largely due to a fall of 1 per cent in TV expenditure.
Sam Balsara
This year promises to finish differently. Prasoon Joshi, Executive Chairman, McCann Worldgroup India, and Regional Executive Creative Director, Asia Pacific, gives the examples of two sectors that will need to step up ad and promotional spends in the midst of a slowdown: fast-moving consumer goods (FMCG) and white goods. “FMCG, for example, needs to remain top of mind and in white goods and such big-ticket items, there will be a greater emphasis on brand-building communication,” he says.Beneath such optimism, however, are a few layers of apprehension. “We are certainly cautious and are constantly looking at effective and cheaper advertising options,” says Manish Bhatt, Senior VP & Executive Creative Director, Contract, who cites the example of the work he did for one of his clients, Aegon Religare Life Insurance. The company launched a campaign called Kum Insurance Lene Ki Bimari (or the disease of taking less insurance) that was restricted only to television and outdoor media. In fact, even in outdoor, we went in only for bus shelters in metros; in smaller towns we opted for billboards,” adds Bhatt. There are other signs of watchfulness. “We are certainly being cautious in our internal recruitments and cutting down on all expenditure internally that is not necessary. We are keeping an eagle eye on all our clients’ investments as well,” says Chandradeep Mitra, President, Mudra Max. A close watch is also being kept on the performance of campaigns on a fortnightly basis; that’s something agencies earlier used to do either mid-term or when the campaigns ended.
Key trends
• High inflation and a moderate slowdown aren't deterring players from stepping up their brand-building activities
• Even sectors most affected by the slowdown, like financial services and aviation, aren?ft taking their feet off the gas
• Mass media like print may suffer at the hands of newer options like digital and outdoor
• After a decline in TV expenditure last year, new channels have begun to grow the market this year
The big spenders
Some numbers that stand out.
• Indian Premier League has put in roughly Rs 300 crore of advertising money into Sony
• Max New York Life is pumping Rs 100 crore in marketing and media
• HUL's ad spend is up 30.5 per cent in the June quarter (over the previous year?fs corresponding quarter), to 10.4 per cent of sales
• DTH will be a big spender this year |
