Pitch Madison Media Ad Outlook 2013

8/10/2019 Pitch Madison Media Ad Outlook 2013

1/16

Pitch|February 20121

PRESENTS POWERED BY

VolumeIX

Issue

5|February2012

VolumeIX

Issue5|

February2012

50

Disappointing 2012Cautious 2013Disappointing 2012Cautious 2013

PRESENTS POWERED BY

Advertisers are expected to remain

frugal on ad spends in 2013 too, unless

the Union Budget springs some surprises


2/16

Pitch|February 2012

PRINTREVIEW 2012

2

INTRODUCTION

18%

YEARLY SPENDS

GROWTH %

18%

18%

18%

18%

18%

Yesterday Once More

The year 2012 was largely tepid

for the media advertising indus-

try, where most verticals saw a

slowdown in growth and fell short of

projected targets. The only sunshine, so

as to speak, was provided by digital and

internet, which continued on its strong

growth trajectory and grew by over 50

per cent with display and search both

growing around 50 per cent.

As far as the industry is concerned,

one cant help but be reminded of The

Carpenters song, Its yesterday once

more, because just like 2011, the glob-

al economy in 2012 too, faced turmoil,

inflation remained high and the Rupee

continued its weak rally against the US

Dollar for most parts of the year. The

media advertising market in 2012 grew

by 5.2 per cent against a projected

growth of 7.5 per cent.

Television, the biggest media platform,

PMMAO 2013 expects the industry to register a cautious growth of 7.4 per cent,

slightly better than the growth achieved in 2012

2008 2009 2010 2011 2012 2013

-9%

19%

0

28%

10%

5.2%7.4%

21,382 Cr ` 19,470 Cr 24,898 Cr 27,282 Cr ` 28,694 Cr ` 30,809 Cr

ProjectedGrowth

Sam Balsara

Chairman & MD, Madison World

BySAM BALSARA


3/16


PRESENTS POWERED BY

against a projected growth of 10 per

cent, remained flat and did not grow

in 2012. The absence of the ICC World

Cup, which had roped in revenues close

to` 750 crore in 2011 and the IPL failing

to garner in as much revenue as 2011,

were the major reasons why TV took a

hit in 2012. Thus, the figures fail to re-

flect the actual growth achieved by a lot

of channels.

Print, on the other hand, surprised

with a 4 per cent growth, as against a

projected negative growth, riding on the

back of strong growth shown by Hindi

and regional dailies and new editions.

However, English dailies, which contrib-

ute almost 50 per cent revenue of the

total newspaper advertising, registered

a de-growth. Magazine advertising im-

proved its overall contribution from 3.9per cent to 4.2 per cent to the overall ad

pie and maintained its 10 percent share

in the print pie.

The automobile sector continued to

increase its share in print spends with

an 11.4 per cent share compared to 9.8

per cent in 2011. However for TV, its

share declined to 6 per cent from 7.6 per

cent in 2011.

FMCGs share in TV and print went up

from 52.8 per cent to 54.4 per cent and

from 8.9 per cent to 10.3 per cent re-

spectively. FMCG continued to form the

backbone for the TV advertising industry.

For the first time since 2008, print

superseded TV to become the largest

contributor to the ad pie at 41.7 per cent

while TV was at 40 per cent. In 2008,

print had contributed 47 per cent, while

TV lagged behind at 39 per cent.

Cinema also disappointed with an 8

per cent growth against the projected15 per cent. The base for cinema con-

tinued to be low, with a meager contri-

bution of 0.5 per cent to the ad pie.

Conventional outdoor grew by only 2

per cent against a projected growth of

5 per cent. However, advertisers seemto have taken to transit media in a big

way with a 28 per cent growth against a

projected growth of 20 per cent and far

surpassing 2011s growth of 3 per cent.

So what is the road ahead for the me-

dia advertising industry? Will the slow-

down continue? Will the sentiments re-

main tepid? There is a lot that depends

on global economy and union budget

and advertisers would be watching it

closely and then try to de-mystify and

understand the nuances of it, because

it will surely have a telling on how 2013

pans out for them.

Pitch Madison Media Advertising

Outlook 2013is quite conservative and

not at all bullish. It expects the industry

to grow by 7.4 per cent, which actually is

less than the projected growth for 2012.

Some predictions for 2013:

TV is expected to grow well, because

of digitisation that will lead to more

spending on niche channel and TRAIs

regulation (10+2) which is likely to be

enforced informally, but more strictly,

which may have an inflationary effect

on TV rates.

For print, regional press is expected to

continue to grow at a faster rate than

English, as will revenues for special

and niche magazines.

A modest 4 per cent increase in radio

and a 10 per cent increase in cinema

is the forecast. In traditional outdoor,

a marginal 2 per cent growth is fore-

seen, however, transit media will con-

tinue to grow at 10 per cent. Digital will continue to grow strongly

and even on a substantial increased

base, achieved on the back of around

50 per cent year-on-year growth for the

last 9 years. It will still grow at a healthy

32 per cent, on the back of FMCG ad-

vertisers waking up to the interactive

medium and engaging power of digital.

TV

PrintRadio

Cinema

Outdoor

Internet

How the Ad Piesplit in 2012

TV, the biggest share-holder till 2011, lost its

share marginally, tolet Print become the

leader once again

40%

41.7%

3.2%

6.5%

8.0%

0.53%

FMCGs share in TV and print ad pies went up from

52.8% to 54.4% and from 8.9% to 10.3% respectively.

It continued to be the backbone for TV advertising


4/16

Pitch|February 2012

PRINTREVIEW 2012

4

PRINT

10,050 Cr 10,487 Cr` 8,073 Cr `11,509 Cr `11,970 Cr

18%

18%18%

18%

18%

18%30%

10%4% 4.7%

Elephantine MarchPrint is expected to grow steadily, even though it is seen losing sharein the ad pie, owing to the growth of digital

2008 2009 2010 2011 2012

With a contribution of

41.7 per cent, print has

emerged as the largest

share holder in the entire

ad pie. From 2008 to

2011, TV had been ruling

the roost

In 2013, Print will continue

to grow at 4.7 per cent

and is expected to clock

revenues worth `12,526

crore

18%-20%

2013

12,526 Cr

0 % GROWTH

ProjectedGrowth

YEARLY SPENDS


5/16


PRESENTS POWERED BY

FMCGs volume growth hasbeen ever increasing

Print 2008 2009 2010 2011 2012

Categories fond of Print

Alcoholic Beverages 0.3 0.3 0.2 0.2 0.1

Auto 6.8 7.8 7.1 9.8 11.4

BFSI 8.3 7.9 8.7 6.7 5.7

Clothing/Fashion/Jewellery 5.1 5.5 5.3 6.5 7.1

Corporate 3.6 3.0 3.0 2.8 2.2

Education 17.1 17.3 14.6 10.6 10.6

FMCG HH 1.9 2.5 2.6 3.1 4.1

FMCG Impulse 0.3 0.6 0.4 0.3 0.4

FMCG Personal Care 3.6 4.1 4.4 5.5 5.8

HH Durables 6.5 5.3 5.3 5.7 4.9

Media 1.9 2.2 2.2 1.5 1.4

Real Estate & Home Improvement 6.4 6.5 8.0 8.4 8.6

Retail 5.5 5.8 5.8 5.6 5.8

Telecom/Internet/DTH 6.2 5.4 6.3 4.7 4.1

Travel & Tourism 4.3 3.5 2.5 2.8 2.3

Others 22.2 22.5 23.6 25.7 25.3

Growth of FMCG FMCG continued to bet its money

on print taking its contribution

share from 8.9 per cent in 2011

to 10.3 per cent in 2012. Its

contribution in 2010 was 7.4 per

cent

Auto continued to be the largest

contributor to print at 11.4 per cent

Some categories that lost share in

the print ad pie, include corporate,

household durables, BFSI andtelecom/internet/DTH

(% Contribution)

DailiesVs

Magazines

in2012

` 1,202 Crore

` 10,768 Crore

Magazines10.2%

Dailies 89.8%

The rise of magazines

Magazines, as against a projected

negative growth, achieved a growth

of 4.5 per cent in 2012

Magazines also retained their share

in the ad pie at 4.2 per cent

Going ahead, magazines are

expected to grow at a rate of 6 per

cent to clock revenues worth

` 1,274 crore in 2013 as against

` 1,202 crore in 2012


6/16

Pitch|February 2012

PRINTREVIEW 2012

6

2013

New Delhi : March 1, 2013

Mumbai : March 6, 2013

For Sponsorship opportunities, contact

:

Rohit Sardana (Delhi) +91 98113 77592 [email protected]

Varnikaa Jain (Mumbai) +91 97691 53087 [email protected]

Sneha Walke (Bengaluru) +91 98455 41143 [email protected]


7/16


PRESENTS POWERED BY

18%

18%

18%

SmashedWith advertisers tepid response to IPLand the lack of a big sporting event like

the ICC World Cup in 2011, advertising

on TV largely remained stagnant in 2012

2008 2009 2010 2011 2012

Growth for TV in 2012, marginallywent in the negative. It, however, is

likely to cross ad revenues worth

`12,000 crore in 2013

However, growth rate, projected at

6 per cent for 2013, is unllikely to

touch the peak growth of 2010 or

even 2011

TVs share in the ad pie in 2013, is

expected to erode further by 0.5

percentage points from the current

40 per cent

8,319 Cr ` 8,492 Cr 10,530 Cr `11,478 Cr ` 11,478 Cr

18%17%

9%

6%

0%

18%2%

18%24%

2013

12,166 Cr

ProjectedGrowth

TELEVISION

YEARLY SPENDS

GROWTH %

0


8/16

Pitch|February 2012

PRINTREVIEW 2012

8

Hin GEC 25 4 -2

Hin News 8 7 4

TN CS 7 27 14

Eng News 6 17 -3

Tel CS 6 20 6

Info 5 45 12

Kids 4 5 20

Hin Mov 4 23 -20 Driven by IPL

Mar CS 4 5 -2Ben CS 4 16 -1

Ker CS 4 5 9

Sports 4 87 -23 Driven by ICC WC

Kan CS 3 14 9

Other Reg 3 35 15

Eng Mov 3 29 5

Others 3 25 23

Music 3 19 13

Eng Ent 2 47 40DD 2 -5 -8

Row Labels 2012

Dispersion % Growth %

(2011/2010) (2012/2011)

Which genres got what?

TELEVISION

Kids grow up; Sports lose

Hindi GECs continued to garner the

maximum share in the TV ad pie;

yet the genre saw a negative growthof 2 per cent

Sports emerged as the biggest

loser with a negative growth of 23

per cent. Ad revenues in 2011 were

driven by the ICC World Cup

Even Hindi Movie Channels took a

hit, as IPL seems to be losing sheen

amongst advertisers

The biggest growth gainers though

seem to be the Kids channels, a

genre which has seen growth rate

rise exponentially from 5 per cent in

2011 to 20 per cent in 2012

Will digitisation emerge as the game changer?

O

ne of the major devel-

opments in the Indian

television space has

been the advent of digitalmodes of broadcast reception

and the conversion of analogue

to digital, which represents a

big change for consumers and

the broadcast business.

The Indian television indus-

try has always followed an

advertising revenue depen-

dent model as opposed to the

subscription based structure

adopted by the western coun-terparts. Digitisation has also

led to a spurt of ad free chan-

nels such as Disney Junior,

HBO Defined, HBO Hits and

Nick Junior, which would be

completely ad free and focus

on subscription for revenues.

Not that ad-free proposition

was missing in India prior to

this. The kick-off of HD (High

Definition) offerings fromvarious channels, more specifi-

cally of sports related events

on channels such as ESPN or a

channel such as Zee Golf from

the Zee Entertainment bouquet

also have ad-free or minimum

advertising versions.


9/16


PRESENTS POWERED BY

FMCGs contribution to TVhas been ever increasing

TV 2008 2009 2010 2011 2012

Categories fond of TV

Alcoholic Beverages 0.8 0.4 0.6 0.8 0.9

Auto 5.6 6.7 6.7 7.6 6.0

BFSI 7.7 5.7 5.2 5.5 4.3

Clothing/Fashion/Jewellery 3.2 2.8 3.3 3.6 3.7

Corporate 3.6 2.5 2.7 2.5 3.4

Education 1.5 1.5 1.6 1.6 1.8

FMCG HH 26.8 30.7 30.0 28.2 29.2

FMCG Impulse 8.2 9.9 8.9 8.2 8.6

FMCG PersonalCare 13.7 15.0 15.6 16.4 16.6

HH Durables 5.3 4.7 5.4 5.5 6.3

Media 0.2 0.1 0.2 0.1 0.0

Real Estate & Home Improvement 3.3 2.8 3.3 3.3 3.7

Retail 1.1 0.6 0.8 0.8 0.8

Telecom/Internet/DTH 13.9 11.8 11.1 11.5 9.4

Travel & Tourism 0.8 0.9 1.5 1.4 1.4

Others 4.2 3.9 3.2 3.1 3.9

In the fast goods lane With 54.5 per cent contribution

to the TV ad pie, up from 52.8 per

cent in 2011, FMCG continues to

rule the roost in the TV ad space

Corporate advertising, is another

emerging big spender on TV

Auto seems to be moving more

towards Print. Hence, the sectors

contribution to TV ad pie has

dipped from 7.6 per cent in 2011to 6 per cent in 2012

Juhi Ravindranath, Network

Head, Ad Sales, South Asia,

Turner International India says,

In the movies business, digiti-sation has positively impacted

the genre, our channel perfor-

mances and thus we expect

both, HBO and WB, to drive

extremely strong revenue

growths. WB is currently trend-

ing at twice the channel shares

it was a little over a year ago.

According to experts, along

with better quality viewing ex-

perience and providing a levelplaying ground for the chan-

nels, digitisation will also lead

to the increase of niche genre

channels with the focus in-

creasing on channels pertaining

to infotainment, edutainment,

lifestyle and food etc.

(% Contribution)


10/16

Pitch|February 2012

PRINTREVIEW 2012

10

INTERNET

Speeding awayWith attributes like enhanced flexibility, scalability and measurable results in real time as

well as cost-effectiveness and better targeting, the pool of digital immigrants is growing fast

From playing second fiddle to

becoming a part of conventional

marketing methods, internet

marketing has gradually crept in

to assume an important place in

brands marketing blueprint. With

attributes like enhanced flexibility,scalability and measurable results in

real time as well as cost-effective-

ness and better targeting, the pool of

digital immigrants is fast growing.

According to Pitch Madison Media

Advertising Outlook 2013, internet

has seen a growth of 50 per cent in

2012 - in line with projections and a

slight improvement over the growth

in 2011 (49 per cent), taking inter-

nets ad revenues up from

` 1,535 crore in 2011 to` 2,303

crore in 2012 (including Search).

Both Search and display advertisinghave seen a growth of 50 per cent

respectively in 2012.

The mediums share in the overall

ad pie has also substantially in-

creased from 5.6 per cent in 2011 to

8 per cent in 2012. While Searchs

contribution to the overall ad pie has

risen from 2 per cent in 2011 to 2.9

per cent in 2012; display advertisings

contribution too went up from 3.6

per cent in 2011 to 5.2 per cent in

2012.

While Searchs contribution went

up from ` 550 crore in 2011 to` 825crore in 2012, Display advertising

saw revenues grow from `985 crore

to `1,478 crore.

Outlook 2013

According to Pitch Madison Media

Advertising Outlook 2013, digital will


11/16


PRESENTS POWERED BY

YEARLY SPENDS

2008 2009 2010 2011 2012

18%34%

18%50% 18%49%18%46%

` 703 Cr` 470 Cr `1,030 Cr `1,535 Cr ` 2,303 Cr

Search

vs

Display

825 Crore

35.8%

64.2%

` 1,478 Crore

18%50%

Internet emerged as the third largest share holder (8%) in

the entire ad-pie pipping Outdoor. It will further consolidate its

position taking its share up to 10%

Both search and display

advertising on the web are

growing at a healthy rate of

50%

The growth is likely to

slowdown in 2013 to

32% in 2013

continue to grow strongly and

even on a substantial increased

base, achieved on the back of

around 50 per cent growth year-

on-year for the last 9 years. It willstill grow at a 32 per cent on the

back of FMCG Advertisers waking

up to the interactive and engaging

power of digital.

In 2013, total spends on internet

including Search is projected to

increase from the existing` 2,303

crore to` 3,040 crore a 32 per

cent increase. Meanwhile, spends

on Search are projected to go

from` 825 crore to` 1,089 crore

in 2013.

The contribution of internet tothe total ad-pie is projected to

increase from 8 per cent to almost

10 per cent.

Search

Internet (Excl Search)

GROWTH %

is the projected growth rate

for Internet in 2013. Sitting

at a little above `2,000

crore, digital is expected

to cross the` 3,000 crore

mark in 2013

32%Net worthy


12/16

Pitch|February 2012

PRINTREVIEW 2012

12

In 2012, the outdoor industry had a

bitter-sweet mix of highs and lows;

the first quarter was very challeng-

ing due to volatility of Indian market.

Most of the brands had squeezed

their budget for outdoor advertis-

ing. But, the second half of the year

brought new opportunities thanks to

the new set of media options such

has transit mediums which gave the

industry a new boost.

With businesses going beyond

borders, people spending more time

in travelling, cities are expanding into

distant suburbs and tier II and III cit-

ies are gaining prominence. People

are spending up to nine hours out-

doors, leading to exponential growth

of the transit medium especially

with around 30 modern upcoming

airports and metro rail expansion in

all major metros.

Considering the potential that

transit media has and the fact that it is

significantly contributing to the over-

all growth of outdoor advertising,

starting this year, Pitch Madison

Media Advertising Outlook 2013, has

included transit media in addition to

the traditional outdoor advertising in

its analysis. Conventional Outdoor,

against the projected 5 per cent

growth, grew by only 2 per cent.

However, advertisers seem to have

taken to transit media in a big way.

Expensive airport advertising showed

strong growth and as a result, Transit

Advertising grew by a robust 28 per

cent against a projected 20 per cent.

OUTDOOR

Outdoor is expexcted to retain its growth rate and share in the ad pie, riding on the

back of transit OOH

Bitter-sweetcocktail


13/16


PRESENTS POWERED BY

More or less, Outdoor achieved the

growth target of 8.7 per cent by

achieving 8.4 per cent in 2012

Fueled by growth in transit OOH,

Outdoor is expected to grow at a

moderate rate of 4.3 per cent in 2013

In transit

mode

` 1,323 Crore

OOH Transit Media

Traditional Outdoor

2008 2009 2010 2011 2012

18%24%

18%30%

18%-7%

18%8.4%

` 1,419 Cr` 1,752 Cr 1,848 Cr 1,717 Cr ` 1,862 Cr

2013

18%4.3%

1,1943 Cr

18%

-19%

Though the year 2012 has not been

the best one for the outdoor medium,

it has definitely proven to be much

better than 2011. 2012 showed an 8.4

per cent increase in the mediumsoverall revenues. The mediums rev-

enue in 2012 stood at` 1,862 against

` 1,717 in 2011. Outdoors share in the

total ad pie also increased to 6.5 per

cent in 2012. In 2011, the share of the

medium was at 6.3 per cent.

As per the Pitch Madison Media

Advertising Outlook 2013, outdoor

is expected to grow by 4.3 per cent

to clock ad revenues worth` 1,943

crore in 2013, of which` 593 crore is

expected to come from transit OOH.

Transit OOH continued

its bullish run in 2012

with a growth rate of 28

per cent as against a

growth rate of 2 per cent

recorded for traditional

outdoor

Transit outdoor is

expected to grow at

10 per cent in 2013

` 539Crore

28.9%

71.1%

ProjectedGrowth

YEARLY SPENDS

GROWTH %

0


14/16

Pitch|February 2012

PRINTREVIEW 2012

14

YEARLY SPENDS

18%

Scaled and FlatEven Phase III of FM radio expansion isnt encouraging the

advertisers to bet their money on the medium

2008 2009 2010 2011 2012 2013

662 Cr ` 681 Cr `885 Cr 903 Cr ` 930 Cr

38%

18%30%

18%3%

` 967 Cr

18%4%

18%3%

18%2%

As against a projected growth of 5 per

cent, Radio grew only at the rate of 3

per cent in 2012, adding only about Rs

27 crore more to its revenue total of

2011

The outlook isnt very encouraging forradio and the Phase III expansion is

also not likely to shake up the industry

much

Expect its share in the ad pie to drop

further from 3.2 per cent in 2012 to

3.1 per cent, as advertisers look for

greener pastures on digital

ProjectedGrowth

RADIO

GROWTH %


15/16


PRESENTS POWERED BYCINEMA

Despite blockbusters like Dabangg 2, Ek Tha Tiger, Rowdy Rathore and Talaash

besides others, Cinema failed to attract expected quantum of advertising

2008 2009 2010

18%24%

18%-20%

18%15%

` 103 Cr` 129 Cr 118 Cr

18%

Cinema, in 2012, grew only by 8 per cent lagging far behind 2011s

growth of 18% and failing to achieve the projected growth rate of 15%

The dry spell is expected to continue in 2013 too, with advertisers

betting more on measurable media like internet and mobile

2013

166 Cr

18%18%

8%18%10%

The Talaash continues

2012

151 Cr

2011

140 Cr

ProjectedGrowth

YEARLY SPENDS

GROWTH %

0


16/16

Pitch|February 2012

PRINTREVIEW 2012

16

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Pitch Madison Media Ad Outlook 2013