As the first quarter of financial year 2016 closes in, we review which categories have been actively spending on TV. Being the first quarter of the year media companies and especially TV broadcasters expect a good amount of spends allocated towards advertising as the marketing budgets are replenished.
Ecommerce continues to spend big on TV
A source we spoke to from a top broadcast network said that they have seen a 15-20% growth in their ad revenues in compared to the same time last year. He further added that growth has been especially good because of the continued spending from ecommerce companies. “Almost as much as 30% of our ad revenues have come from ecommerce brands. Apart from this FMCG brands continue to maintain their level of spends like the previous year and they still continue to contribute the highest spends among the brand categories. Auto spends were low during the quarter, they may pick during the next quarter. This is because auto companies are choosing to pick up inventory in a few news channels and niche genre channels and spend more money on print,” he said.
While the head of the revenue department of another TV broadcaster too said that ecommerce brands have been spending on their network but they have seen BFSI companies and even consumer durables spending. He said they expect them to continue to increase spends in the coming quarters, especially during the third quarter which falls during the festive season. Ecommerce he said accounted as much as 20-25% of their ad revenues.
Policybazaar.com has spend 50% of the their brand building marketing budget on TV during the first quarter. The ecommerce company has a marketing budget of Rs.80-100 crore during the year out of which 80% of the ad spends are expected to go towards television.
Another ecommerce brand CarTrade.com had spent a large majority of their marketing budget on TV in Q1. During the first quarter they had spent 50-60% of their marketing budget on TV said Vinay Sanghi, CEO, CarTrade.com. He said they are looking to continue with the same level of spending on TV in the coming quarters this year.
According to Deepak Netram, SVP, Lodestar UM television has been a larger part of the brand spends during the quarter. “Of course you know the ecommerce is on a big high. So that is definitely fuelling a lot of the television revenues. It is fueling print also. Durables by and large in addition to ecommerce has also been increasing spends. I think as we are approaching the festive period you do see a lot of brand categories coming on board,” he said.
Another senior media planner said that almost as much as 60% of the ad spends of some ecommerce had been on television during the quarter. “Most of the ad spends of the ecommerce brands are due the continuous sales discounts that they have every few weeks to boost sales. Television is the right media for now in order to get their audience attention in the run up to these special sales. They are spending a lot on television now because spending only on digital or print doesn’t work and they have understood this,” he said.
Another media planner from a GroupM agency said, “Most ecommerce brands they are handling had spent more than 70% of their marketing budgets towards television in the first quarter.”
“While quarter one brought in decent growth, we expect quarter two to be slow as many brands anticipate spends for the festive season in Q3. Quarter three is what we look forward to as it is the festive season and we can expect even higher spends this time around,” said the Sales Head of TV channel.