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Ad spends to grow only by 7.4% in 2013: Pitch Madison Report

11-February-2013
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Ad spends to grow only by 7.4% in 2013: Pitch Madison Report

Pitch Madison Media Advertising Outlook 2013 (PMMAO), unveiled on Friday, projects a bleak year for the media advertising industry, which is likely to grow only by 7.4 per cent.

“You might wonder why not less than 7.4 per cent?” asked Sam Balasara, Chairman and MD, Madison World while he presented the toplines of the report. “Because we are not pessimist. We expect new advertisers, new marketers and new categories to enter the media advertising space. Rural consumption is going up and modern trade has increased.” Balsara further said that advertisers have now understood that sacrificing on brand building in a tough year is not the right option.

While being too negative is not an option, neither is being too positive. Balsara pointed out that since the word for 2013 too is ‘cautious’, PMMAO did not derive a figure more than 7.4 per cent.
He said that India is the 12th largest advertising market in the world and the fourth fastest growing market on advertising grounds. However, the country still continues to be under advertised.

Global economy has been slow and some categories individually witnessed a slowdown too; thus, affecting their share in media advertising. “High advertising spends in last quarter failed to drive sales. Also, we expect advertisers to divert money in discount sales and promotions,” added Balsara.

The projections for various segments within media advertising are as follows:
• Television: TV’s share in the ad pie in 2013 is expected to erode further by 0.5 percentage points from the current 40 per cent and is likely to bring in ad revenues worth Rs 12,166 crore in 2013. Digitisation will give niche channels more focus.
• Print: Print will continue to grow at 4.7 per cent and is expected to clock revenues worth Rs 12,526 crore. Regional press is expected to continue to grow at a faster rate than English, as will revenues for special and niche magazines.
• Digital: Digital will continue to grow strongly and even on a substantial increased base, achieved on the back of around 50 per cent year-on-year growth for the last nine years. It will still grow at a healthy 32 per cent on the back of FMCG advertisers waking up to the interactive medium and engaging power of digital. The medium is expected to bring in ad revenues worth Rs 3,040 crore, of which Rs 1,089 crore are expected to come from ‘search’ alone.
• OOH: Fueled by growth in transit OOH, outdoor is expected to grow at a moderate rate of 4.3 per cent in 2013 to clock ad revenues worth Rs 1,943 crore in 2013, of which Rs 593 crore is expected to come from transit OOH. Transit outdoor is expected to grow at 10 per cent in 2013.
• Radio: Situation for radio is not very good. As the sector clocks Rs 967 crore, radio’s share in the ad pie is expected to drop from 3.2 per cent in 2012 to 3.1 per cent, as advertisers look for greener pastures on digital.
• Cinema: The dry spell is expected to continue in 2013 too, with advertisers betting more on measurable media such as internet and mobile. The medium is expected to clock Rs 166 crore.

Pitch Madison Media Advertising Outlook 2013 was presented by ABP News.

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