IPL deferral, lockdown woes may cause advertisement spends to fall in 20201 min read . Updated: 24 Jun 2020, 06:53 AM IST
Radio, outdoor, print advertisements fell by 80-90% in April, May
NEW DELHI : Following the easing of lockdown restrictions, advertising spends saw a gradual recovery with companies, markets and malls opening up for business. Led by television, ad spends grew 20% in June from last month, primarily helped by fast-moving consumer goods (FMCG), e-commerce and smartphone firms.
However, the complete washout of the crucial first quarter, which is typically dominated by advertising around the Indian Premier League cricket tournament and summer products, will significantly impact the overall Indian advertising expenditure for 2020.
According to media buyers’ estimates, Indian advertising, which was expected to touch ₹75,000 crore this year, will remain either flat or slide below last year’s of ₹67, 000 crore.
Vinita Pachisia, senior vice-president, Carat, a Dentsu Aegis Network-owned media agency, said April, May and June have seen a downward trend for advertising spends due to the lockdown. “While television did get some revenues owing to FMCG firms and online portals, absence of original content on general entertainment channels (GECs) affected the market revenues. There will be multiple factors, going forward, which will decide on how soon advertising will bounce back to pre-covid levels. These could (depend on) opening up of offices, retailers, shops, and resumption of shoots of TV serials, among others."
While TV advertising declined by 60-70% in the last two months, radio, outdoor and print have taken a bigger hit of over 80-90%.
“In the last two months, media spends have declined by 60-70% across platforms given the lockdown. June onwards things have started improving, but it will have a big impact on overall advertising expenditure of 2020. The overall media spends are likely to go down by 18-22% as compared to last year. All media has been impacted, including television. This was led by IPL not happening and most summer categories, such as cellular phones, perfumes and deodorants, cola drinks and air conditioners, not able to advertise during lockdown," said Navin Khemka, chief executive officer, MediaCom South Asia.
Although viewership shot up both on television and digital streaming platforms, ad spends fell because there was no demand and, hence, no active advertisers. It also created pressure on television channels to offer discounted rates, which will stabilize once demand revives.