Mumbai: Advertising spending in the Asia-Pacific, including India, increased in the second quarter of calendar 2009, signalling a turnaround for broadcasters and print publishers that had been hard hit by the regional economic downturn.
According to Nielsen Co., a research agency, advertising spending in the Asia-Pacific rose 11% in April-June from a year earlier to an estimated $29.96 billion (Rs1.4 trillion), with India leading the way.
Spending on television and print media advertising rose 28% in April-June in India, according to the report. Other regional markets that recorded growth in advertising during the quarter included China (17%), Indonesia (8%) and the Philippines (9%).
“In India and China, both of which saw sharp cutbacks in advertising activity in the first quarter, advertising bounced back strongly with double digit growth over the same quarter in 2008,” said Richard Basil-Jones, Asia-Pacific managing director at Nielsen.
Advertisers had cut back on spending during the economic downturn, hurting the revenues of broadcasters and print publishers in the Asia-Pacific. Regional economies, including India, have since rebounded.
To be sure, the bounceback in ad spending isn’t region-wide. Seven countries recorded declines in the second quarter, including South Korea (-17%) and Taiwan (-16%).
In India, though, some advertisers and experts say that there’s been an increase in advertising in some categories.
According to a beverage industry expert, who didn’t want to be named, there’s been a spurt in ad volumes this year. The soft drinks industry spent around Rs350 crore on advertising in 2008, and its budget increased in excess of 20% this year.
Big-budget automobile industry launches have seen auto and bike makers splurge on advertising. Sanjeev Shukla, general manager at Ford India Pvt. Ltd, said industry prospects had improved with the new launches, but said he wasn’t too convinced about Nielsen’s 28% figure for growth in advertising spending.
Even broadcasters such as Star India Pvt. Ltd are sceptical. Says Uday Shankar, chief executive, Star India, “I think that there is a definite growth in ad spending for TV, but I am not sure whether the numbers are as rosy as what’s been released by AC Nielsen.”
According to TAM Media Research Pvt. Ltd, there has been an increase in television and print ad volumes for the August-September period from a year earlier. TV ad volumes were up by 42% and print ad volumes by 13%.
R. Gowthaman, head of the Mindshare unit at GroupM India Pvt. Ltd, said big budget television properties and launches such as mobile phone service provider Tata Docomo had perked up ad spending in India.
His agency had predicted a 4.7% growth rate in ad spending in 2009 over 2008 in its report released in June.
“I wouldn’t be surprised if that growth rate has now increased to 8%, because of festive spends and huge TV properties,” he said. “But a 28% growth over last year is too ambitious.”