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2008 Olympics torch unlikely to light up Indian TV ad spends

2008 Olympics torch unlikely to light up Indian TV ad spends
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First Published: Wed, Apr 23 2008. 12 16 AM IST

Updated: Wed, Apr 23 2008. 12 16 AM IST
Mumbai: As the torch for the Beijing 2008 Olympic Games makes its way across the world, special commercials and promos are being readied for this August mega event. Industry analyst Informa foresees worldwide net advertising revenues for TV rising 5.8% this year to $123 billion (Rs491,262 crore), versus last year’s 3.5% growth—partly due to the Olympics and despite overall economic despondency. India presents a different small screen though: The Olympics have never been a huge draw for Indian advertisers with its limited viewing audience. Throw in economic volatility, marketers conserving spends for the festive season and towering ad spends already pledged to our real torch-bearing television event of the year—the Indian Premier League (IPL)—and TV ad spends related to this event could be even duller, agree various media buyers. Political controversy has also been dogging these games, and some global advertisers are not sure if they even want to be seen on such a platform.
Media buyer and specialist Chandradeep Mitra, president, Mudra Max, says that advertising on the Olympics will be driven by two factors: India’s chance of winning a medal and some of the global sponsors who are active in the Indian market. India has some chance of winning medals in shooting and wrestling.
However, this will not help TV ad spend to grows; print is more likely to benefit from this opportunity. “In the last Olympics, the estimated advertising spend on Doordarshan (DD) during the live telecast was around Rs41 crore,” says Mitra. A DD executive says even that would be too high. Another official, Dhiranjan Malvey, director, commercial, Doordarshan, says the Olympic games are part of their public service—not commercial—agenda and involves promotion of games/sports in the country. But if it garners revenues as a by-product, then why not?
This year, the fact that the only team sport where India had the remotest chance of showing anything worth watching—hockey—has no Indian representation will further dampen the spirit of our viewers, says Ravi Kiran, CEO, South-East and South Asia, Starcom MediaVest Group.
Typically, the worldwide partners of an event such as the Olympics are the biggest advertisers before and during the event. The good news is that quite a few of these brands are present in India—Visa, Samsung, McDonald’s, Coke, Lenovo, Kodak, and Panasonic. But, except Samsung and Lenovo, all others have a relatively modest marketing budget. This alone can mean bad news for Olympics-related advertising, adds Kiran. The Olympics partners are expected to run consumer promotions and invest funds there, instead of doing a lot of high-profile advertising. One positive is the time difference between India and Beijing is not much. A favourable broadcast time band promises larger viewing audiences for live events which could attract more advertisers.
So, how much would Indian advertisers would fork out for TV spends? Shashi Sinha, CEO, Lodestar Universal, makes a guess based on current TV spends. His math: “While there are no reliable estimates...my sense is 2007 saw ad spends of Rs6,000 crore. While one normally expects an increase of 10-12% per annum, I am not sure of the status this year, as the sentiment is a bit low currently and various categories, such as auto finance and corporate, have already started slowing down. IPL hopes to collect at least Rs200 crore just on TV advertising. The Olympics look tough to me from a media spend point of view. My estimate is that between TV and print, companies will spend a maximum of Rs100 crore to leverage this opportunity... The focus will be on creatively taking advantage of the Olympics rather than a dramatic increase in media spends. There will be a lot of low-cost but interesting and innovative activity on the emerging media (front),” says Sinha.
The guesstimates of N.P. Sathyamurthy, joint president, Lintas Media Group are even more conservative: “With DD telecasting the 2008 Olympics, too, the overall TV ad revenue on this event should be in the range of Rs15 crore.”
Some of the new categories that have been aggressive since the last Olympics might take advantage of this event on DD to cater to their expanding smaller town focus, he adds. DD is the only network that is likely to benefit.
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First Published: Wed, Apr 23 2008. 12 16 AM IST