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Ad expenditure on TV to grow at an unprecedented 21% in 2015, says Madison Media
MUMBAI: Buoyed by a steep increase in advertising expenditure on TV in the first half of 2015, Madison Media has revised upwards its growth forecast for 2015.
The new forecast has pegged advertising expenditure to grow by 13.8 per cent to touch Rs 42,234 crore (Rs 422.34 billion) in 2015.
Incidentally, this upward revision is only because of the 20.6 per cent increase in spends on TV during the first half of 2015. This was driven by more than expected spending from sectors like ecommerce, FMCG and automobile industry. Madison Media expects the growth rate to extend to the second half of the year, resulting in a sharp growth in TV advertising to as high as 21 per cent.
In its original forecast report released in February 2015, Madison Media had predicted an overall 9.6 per cent growth in 2015, with television advertising growing by 10 per cent. According to the revised Pitch-Madison Media Advertising Outlook report, TV advertising is projected to grow by 21 per cent.
“Such a high growth rate is unprecedented and has not been achieved in the last 5 years,” Madison Media said.
Madison Media has not revised its forecast for Print, Radio, Cinema, Outdoor or Digital, since it does not anticipate any major change in the growth rate projected. It said that actual growth rates for these media vehicles may be marginally higher than the originally projected growth rates.
Madison World chairman Sam Balsara said, “If BJP promised ‘Achhe din’ to all Indians, they have certainly arrived for the Indian television industry. A 21 per cent growth coming on the back of a 14 per cent 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.”
Highlights of ad spending on TV in the period January-June 2015:
- TV spends have increased by 21% in H1’15 with total revenue of Rs 8200 crore as against Rs. 6800 crore in H1’14.
- The main categories who have fuelled the overall growth in H1’15 are E-commerce (+70%), Automobiles (+55%) and FMCG (13%). HH Durables and BFSI categories also increased their ad spends by more than 45%. FMCG has been largest contributor in absolute terms contributing as much as Rs. 4,200 crore and accounts for 51% of the total TV spend. E-Commerce players grew by 70% and now account for 6% of the market.
- Total FCT volume across all genres/channels has increased by 14%. FCT of SD channels increased by 11% and HD channels by 224%.
- Overall FCT of SD feed on Hindi Mass Genres (GEC + Movies) has increased by 8% comparing like to like channels.
- Many channels have telecast more than 12 mins/hr of FCT across all leading channels resulting in increase in ad revenue.
- New channel launches in Hindi Mass Genres (Sony Max2, Epic & TV, Sony Pal, Zindagi) from existing bouquets and spends on HD channels also resulted in a hike in advertising revenues.
- ICC Cricket world Cup, IPL, Delhi State elections also contributed to the overall growth in H1’15.
- Finally, in H1’15 TV is the largest contributor to the total advertising pie with a share of 40% as compared to 38% in 2014.