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Evolving advertising landscape: Digital matches strength with TV

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Evolving advertising landscape: Digital matches strength with TV

In today’s market, consumers are hooked to more media platforms than ever. Digital media is now becoming a necessary evil. The next five years will see a major chunk of advertising spends shifting from TV to digital.

According to Nielsen’s State of the Media report on Advertising & Audiences, National TV drives campaign reach, but digital provides incremental reach and the opportunity to reinforce advertiser messages across platforms with increased frequency.

The advertising landscape is evolving at an unprecedented rate. Changes in the population are creating a younger, diverse and tech-savvy consumer base. Identifying how to reach them has become more complicated due to an exploding number of viewing options, says the report.

The digital advertising segment has been growing at an average rate of 40 per cent over the past three years. According to the FICCI KPMG Media and Entertainment Report 2014, the Rs 3,000-crore sector grew 38.7 per cent in 2013 - the fastest pace of growth in media.

At present, mobile and internet advertising is one of the most cost-efficient mediums. Digital marketers are recognising this trend and are now considering to or are already on their way to execute ‘Mobile-first’ branding and customer engagement strategies. Google and Facebook account for close to half of the online advertising revenue in Asia, and the dominance can be attributed to their massive user base, according to the report.

Digital ad-spend and the landscape digital advertising in India grew by approximately 38.7 per cent to touch $ 30.1 billion in 2013. Indian mobile advertising is expected to grow at 50 per cent and reach $5.1 billion by end- 2014.

However, the total TV advertising market is estimated to have grown around 9 per cent in 2013 to $136 billion, lower than the 11 per cent projected in the report last year. TV advertising is growing at a diminishing rate. And one looks at the drastic changes happening in other parts of the advertising market, it won’t be long before TV ads reach their saturation point.

Leroy Alvares, President, Rediffusion Y&R Digital, feels that digital media can pose to be the biggest threat to TV. “The journey began with the arrival of YouTube in 2005 which exploded the notion that a few hundred channels represented broadcasting. YouTube's motto of "Broadcast yourself” created millions of channels creating and addressing the need of the discerning audience. What’s actually in demand is a person’s ‘Attention’ and that’s getting captured by mobile devices like phones and tabs. Additionally, the need to see things at your convenience rather than appointment viewing will be an advantage for digital media. With content proliferating to the social media channels across the day parts also gives digital media an edge,” said Alvares.

Pratik Gupta, Co-founder, FoxyMoron, is of the opinion that the two mediums will co-exist, but within the next five years, digital will be at the centre of all activities. He says, “Digital has now become a necessary evil. And this has led to a shift in the formats brands are using. While in the physical world, visibility is about projection-mapping, ambush marketing and experiential, in the digital world brands reach people using targeted advertising.

To this point, Rediffusion’s Alvares says, “Today they truly coexist each leveraging the strength of the other. However the challenge today is between producers and consumers is piracy. Thus, the challenge is monetization. Most content is released by production houses on the digital media soon after its television debut to their official channels to avoid piracy, thus reaching out to large audiences, but missing the moolah.”

“The challenge in the digital media content space is defined by a perspective of free as the user pays for the cost of carriage (broadband cost). Add to this is the experience that digital media delivers today is largely poor due to broad band connection speeds. However, with better connection speeds and the advent of 4G coupled with e-commerce success we can look forward to a mindset that pays for value. Thus, value pricing would surely be an advantage to a convenience seeking generation with superior broadband connections,” he added.

According to Siddharth Puri, CEO, Tyroo Media, Internet of Things is the latest buzzword, and we are just beginning to scratch the surface of what is possible with this concept.  Meanwhile, people's online activity is ever more dominated by search engines, where a brand's visibility depends on the content it pushes out on a daily or weekly basis. “We are seeing significant focus from all the big media publishers on developing and promoting original content on behalf of brands too, as this is increasingly acknowledged to be a hugely important revenue stream for them,” he pointed out.

On a broader note, John Kerr, Managing Director, Zeno Asia, feels that it's no secret that as audiences spend more and more time on digital platforms. The result is a surge in branded editorial and entertainment content, competing with online entertainment and news. All this is happening at the expense of traditional media, and advertisers need to follow them.

“It's so much more than advertising: it's bringing the right experience to the right people, enabling a brand to inspire and educate its target market.”

With the two mediums battling it out in the present scenario for advertising spends, it remains to be seen how the landscape eventually changes in the next few years.


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