The northward climb of TV advertising from 10% to 21% for the current year will result in the total market reaching Rs 42,234 crore in 2015, states the revised Pitch-Madison Media Advertising Outlook report.
A renewed optimism, a stable government, upbeat consumer confidence, ICC World Cup, IPL and implementation of Phase III radio expansion would drive industry growth in 2015 to reach a total volume of Rs 40,658 crores. This is what the Pitch-Madison Media Advertising Outlook, the benchmark study that industry looks up to for understanding and analyzing trends in growth of the advertising industry had forecasted for 2015.
The unexpected high However, the period from January-June 2015 has already exceeded expectations. Against the original forecast of 9.6% growth, projected in February 2015, the study has now revised its forecast upwards to 13.8% for the total advertising market. This upward revision comes on the back of a steep increase in spends on TV during January-June 2015 period of 20.6%. This growth rate is likely to extend to the second half of the year too, resulting in a sharp growth in the TV advertising market of as high as 21%. Such a high growth rate is unprecedented and has not been achieved in the last five years, the report states.
Says Sam Balsara, Chairman Madison World, “If the BJP promised Achhe din to all Indians, they have certainly arrived for the Indian television industry. A 21% growth coming on the back of a 14% growth in 2014 and without the Elections is quite unprecedented and shows the optimistic outlook of industry in Indian markets and the aggressive stance they are willing to take to protect and grow their market share. The growth is also significant in the light of growing conversations around Digital.”
It’s to be noted that Madison Media has not revised its forecast for Print, Radio, Cinema, Outdoor or Digital since it does not expect significant changes in the growth rates predicted for these media, though these too could be marginally higher than predicted earlier.
Prime Time Reasoning According to the report, TV spends increased by 21% in H1’15 with total revenue of Rs. 8200 crore as against Rs. 6800 crore in H1’14. The main categories that fuelled this overall growth in H1’15 were e-commerce (+70%), automobiles (+55%) and FMCG (13%). Household durables and BFSI categories also increased their ad spends on television by more than 45%. The report singled out FMCG as the largest contributor in absolute terms contributing as much as Rs. 4,200 crore and accounting for 51% of the total TV spend. E-commerce players’ presence on TV grew by 70% and at present accounts for 6% of the market, notes the PMMAO revised outlook.
The total FCT volume across all genres/channels increased by 14%, the report revealed. FCT of SD channels increased by 11% and HD channels by 224%. The overall FCT of SD feed on Hindi Mass Genres (GEC + Movies) also increased by 8% when comparing like to like channels. The report found that many channels have telecast more than 12 mins/hr of FCT across all leading channels resulting in this increase in ad revenue.
Another factor that played a role in increasing ad spends was the new channel launches in Hindi Mass Genres (Sony Max2, Epic & TV, Sony Pal, Zindagi) from existing bouquets and spends on HD channels which also resulted in a hike in advertising revenues, according to the report. ICC Cricket world Cup, IPL, Delhi State Elections also contributed to the overall growth in H1’15, the report stated, concluding that in H1’15 TV is the largest contributor to the total advertising pie with a share of 40% as compared to 38% in 2014.
