The government’s fight against black money has caused not a few headaches for advertisers and businesses. From FMCG to auto to OOH agencies to ad agencies, everyone has been impacted in some way or the other. For the radio sector, the impact has been mainly felt from local advertisers who have been most hurt by the paucity of cash in the market.
"The impact has been very severe. A lot of advertisers have put their campaigns on hold. A few campaigns that were in the final stages of negotiations have also been deferred. The good news is that everyone believes this is temporary and the campaigns will come back," says Prashant Panday, MD & CEO, Radio Mirchi.
"Initial reaction has been a bit skeptical. We have seen around 8 per cent cancellations. Events that largely depend on local sponsors have been postponed due to market sentiments. This will continue for a month or so. As advertisers need to catch up their sales; they would not stay away from promoting their brands and offers for long,” informed Tanaya Patnaik, Executive Director of Kanak News and Radio Choklate 104FM, an Orissa-based radio station.
In reply to being asked whether the station is looking at providing any special offers to attract advertisers, she said, “Not really. Due to cut throat competition media platforms have long been operating at their rock-bottom rates. So no further discount or add on at this stage.”
Vineet Singh Hukmani, MD of Radio One opined that it is difficult to predict the actual impact of demonetisation as an event like this was unprecedented. “Demonetisation has affected advertiser sentiment especially real estate and some retail advertising. However, we at Radio One are not so affected as our upscale audiences continue to buy using cashless methods and our advertisers know this and continue to advertise with us.”
Satyanarayana Murthy, CEO at India Radio Ventures - Radio Indigo, Indigo LIVE Music, Indigo LIVE events - India Radio Ventures, agreed that there has been some impact on the radio sector, especially with the likes of FMCG, real estate and jewellery cutting back on spends for the time being. However, he feels that this is a temporary phase. “I don’t see this continuing beyond mid-December. Apart from the current phase every other factor is in favour of business growth; the monsoon has been good, there is enough money in the market, so business should get back on track soon,” he said.
When asked whether mobile wallets have been taking advantage of the situation and increasing their spends on radio, Murthy said that they were in the process of negotiating campaigns with some of the larger mobile wallet operators.
But could the current slowdown result into better business in the first quarter of 2017. It might be possible, but it depends upon how soon the current aura of uncertainty disappears.
"I expect the current scenario to continue until end-December. In Jan-Mar, I hope there is a big revival. But there is an element of doubt about JFM also. It will depend a lot on how clients handle the slowdown in their business post Nov 8th. Since it’s temporary, we believe clients will come out aggressively in JFM to grab market share," opined Pandey.