TV & Digital to bounce back faster than other media sectors, say experts
According to industry observers, advertising will resume once the economy starts to recover & digital and broadcasting will be the early gainers
One of the highlights of this COVID-19 era has been the spike in media consumption on TV and digital platforms, all attributed to the stay-at-home and work-from-home norms. Although this rise in viewership has not truly translated into ad revenues, industry experts firmly believe that post lockdown television and digital will grow faster than any other sector.
A quick look at the TAM adex data shows that a while digital saw an 11 per cent growth in ad volumes across mediums in March and April 2020 compared to February, TV gained by 4 per cent. Radio saw 5% growth but print ad volumes dropped by 26%.
If only April is taken into consideration, we see advertising volumes did see a considerable drop across mediums but the fall for digital was still lower at 26.13% when compared to broadcast that saw a 46.15% drop with Radio at 71.43% and Print at 84%.
Reflecting on the drop in ad revenue, Jehil Thakkar, Partner and Head, Media and Entertainment, Deloitte India, says that with the exception of print, consumption has been up for radio, digital and broadcasting but the issue lies with the monetisation of this increase in viewership.
“There is a spike in the number of viewers and ratings but how do you monetise that and so we have been seeing a slide in advertising. A lot of that growth is tied to the economy. We will see some advertising coming back when the economy starts to recover. And when that happens, I believe digital and broadcasting will be early to recover. Digital has already seen a spurt in consumption and in the case of broadcasting the advertising money comes from larger companies and these tend to the bigger and resilient ones. Sectors which rely on MSME and local advertising will be able to bounce back faster.”
Meanwhile, Ashish Pherwani, Partner and Media & Entertainment Leader, EY India, pointed out at the factors that will contribute to a quicker recovery for select sectors.
“Mediums that provide reach and measurement quickly will recover the fastest. Bundled digital plus traditional packages will be important, particularly for long tail advertisers. Also, advertising will start to see a rebound as the lockdown is lifted. Geographically calibrated ad packages will be critical during May and June,” Pherwani said.
“Ad volumes can be expected to be higher in smaller towns where the impact of COVID-19 is less, as compared to the metros,” he added.
According to Pherwani, while certain sectors like live entertainment, travel and restaurants will take time to recover, others will bounce back once their supply chains get back to normal.
Talking of recovery measures, most mediums have already started to review their old business model and introduce new revenue options. For instance, in the print industry, Times of India has put its e-paper behind the paywall.
Thakkar spoke of some of the measures that companies will adapt for cutting down costs. “The focus will be on core operations and different business models rather than pure acquisition. Companies will conserve cash and focus on advertisers that are going to recover faster. We know that travel, tourism and hospitality are not going to recover for a while but sectors like pharmaceuticals, FMCGs and retail will come back faster. So the focus must be on advertising pitches with a macro picture in view as you plan your growth ahead.”
Dinesh Singh Rathore, CEO, Madison Media Omega, had similar thoughts on the recovery path. “Companies are already taking measures. My take is that they have to come up with some innovative solutions and are encouraging people to invest in media.”
Reflecting on how things could be in the post-Covid world, Rathore said: “Nobody is going to do numbers that they were doing before, but as compared to OOH, Cinema, Radio or Print, both TV and digital will perform much better. The first quarter, including April and May, has almost been a write-off, so before brands really start advertising they want some semblance of stability. People will want to wait for 2 to 3 weeks to see because they don't want anything to go wrong once they start operating. They want a couple of weeks of stability before resuming communication.”For more updates, be socially connected with us on
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