A shift in consumer habits towards e-commerce and a rebound in demand for FMCG products will keep kitchen fires burning for broadcasters.After going through a lull for several months due to economic uncertainty induced by the Covid-19 pandemic, television advertising has shown mild signs of revival during the festive season, between the months of September and November.
As per BARC India, advertising volumes grew by 10-11% over 2019 during Dussehra and Diwali 2020. Ad volume for Ganesh Chaturthi was up 7% over last year. The industry is now counting on sustaining this momentum until the end of the current financial year.
Another study, by TAM, found that there were 655 new advertisers who made an appearance on general entertainment channels in 2020 versus 2018 and 2019 during the months of September-November. These new advertisers were led by Facebook, Airtel Payments Bank and Whitehat Education Technology.
However, the number of categories and advertisers spending on GECs fell during the festive period. The number of advertiser categories dropped from more than 375 in 2018 to about 330 in 2020. In 2020, there were about 280 fewer advertisers on GECs as opposed to 2018.
The spike in advertising volumes tells only half the story. Advertising revenue for leading broadcaster Zee Entertainment Enterprises was down 26% y-o-y in Q2 of FY21 at `902.8 crore for the quarter. In Q1 FY21, though, the company’s ad revenue had fallen by 66% y-o-y.
Not surprisingly, a large chunk of ad spends went into IPL 2020. Ad volume in the sports genre was up by 86% over 2018. “This festive season was anchored around IPL and as expected, it took the lion’s share of the pie,” says Deep Drona, COO, Enterr10 Television.
Unlike other years, advertising during the last few months was dominated by ed-tech, gaming, and fintech brands such as Byju’s, White Hat Jr, Dream 11, MPL, and CRED. “These companies, which are possibly flush with fresh funding, will continue to advertise for the next few months to acquire new customers and build their brands,” observes Kishan Kumar, chief growth officer, Wavemaker.
A shift in consumer habits towards e-commerce and a rebound in demand for FMCG products will keep kitchen fires burning for broadcasters. For instance, India’s largest advertiser Hindustan Unilever spent `1,936 crore in the July-September quarter, 17% less than what it spent during the same quarter last year. Marico MD and CEO, Saugata Gupta, stated in the company’s earnings call that investment in advertising spend is at 9.5% of sales which is almost close to pre-Covid levels for the company.
“About 80-90% of FMCG ad spending is back as compared to last year; this is a sign of revival. However, there is pressure on broadcasters to sell ad slots at discounted rates and the unit price of advertising is not back to pre-Covid levels. Several brands are moving spends from TV to digital media,” informs Pawan Jailkhani, chief revenue officer, 9X Media.
Bigg Boss, the leading non-fiction show from the Viacom 18 stable, has pinned its hopes on capturing ad spends from Dussehra to Christmas and New Year. The company has roped in 15 sponsors for Bigg Boss this year. Mahesh Shetty, head – network sales, Viacom18, says the gap between the volume of ads and revenue earned is narrowing. He expects advertising spend during the second half of the fiscal, that is, October 2020-March 2021 to register about 5% growth y-o-y.
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