The worst seems over as industry projected to net Rs 12,325 cr in H2: Pitch Madison Media Ad Outlook 09
After seven years of fierce growth, the Rs 21,000-crore Indian media and advertising industry experienced the first bout of negative growth during the first six months of 2009. According to the Mid-Term Review of the Pitch Madison Media Advertising Outlook 2009, the industry together garnered just Rs 7,452 crore in the first half of 2009, which is a whopping Rs 1,414 crore less than what it mopped up in the same period last year.
As per the Mid-Term Review, while the worst affected was the print media, which saw a massive 32 per cent decline in its revenue mop-up, television saw a 19 per cent drop, with cinema and outdoor getting hit heavily at 37 per cent and 30 per cent, respectively. However, there was only a moderate 5 per cent decline in radio revenue. In fact, the Internet media is only media format that recorded growth during the first half, logging in a 16 per cent growth.
So, what do the numbers project for the next six months? Though the impact of a looming drought remains very much alive, on the macro front there are many positive signs with the economy showing clear signs of pulling out of the morass. While all leading corporate houses have reported better-than-expected profits in the April-June quarter, the latest IIP data came as the biggest surprise, clipping at a stupendous 7.8 per cent in June.
“All these lead us to believe that the next six months are going to be much better than the first six months. Our detailed forecast for the July-December period shows that while the media industry earned only Rs 7,452 crore in the first half, we estimate the industry to net Rs 12,325 crore in the second half. And this is a massive 65 per cent jump over the first half,” said Madison Media Chairman Sam Balsara, while releasing the Mid-Term Review of the industry. Balsara, however, noted that “this jump will be driven by a combination of increase in ad rates and an increase in ad volumes.”
According to Anurag Batra, Chairman & Editor-in-Chief, exchange4media Group, “It seems the worst is over for the industry. It is time the media industry got ready for better times. But it will pay to remain sober in the months ahead.”
However, on an aggregate basis, even this massive increase in revenues in the July-December period will not pull the full year estimate out of the red. “Going by our revised numbers, we expect a negative growth of 5 per cent for the full year, against a positive growth of 2 per cent that we had forecast in January. As a result, the industry is projected to close calendar year 2009 with Rs 19,777 crore, as against Rs 20,717 crore in 2008,” said Amit Agnihotri, exchange4media Group Co-founder and Editor of Pitch magazine.
The Pitch Madison Media Ad Outlook has recorded that for the past five years and until the third quarter of 2008, the advertising and media industry was growing at a furious pace, averaging around 17-18 per cent year-on-year. For instance, in 2004, the industry grew by 11 per cent, 15 per cent in 2005, and a full 22 per cent each in 2006 and 2007. Last year, it grew by a smart 17 per cent.
For more details, watch out for the latest issue of PITCH, or write to Madison Media Research Centre firstname.lastname@example.org
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