June sees a resurgence in digital advertising, volume up 27%: TAM AdEx
According to industry experts, in the coming months digital is expected to grow further as clients come back and drive some revenues
After the onslaught of COVID-19 that crippled advertising as a whole, June has witnessed a positive growth in advertising volume on the digital medium as compared to the April and May figures in the TAM Adex Television & Digital Advertising Report for Q1.
The report shows a resurgence in ad insertions/day during June’20 on the digital medium post facing a drop in April-May’20.
The medium saw a 23% drop in April but it gradually picked up bringing the drop to 5% in the month of May, and in June digital advertising witnessed a 27% growth in ad volume.
Moreover, the drop in ad insertions on digital when compared to the same period last year is the least for June. In March-May’20 the ad insertion drop compared to March-May’19 was at an average of 48%. A further break up shows that drop in digital ad insertions compared to last year was at 44% in March, 53% in April, and 47% in May but the difference has reduced to 23% in June.
Sharing insights on the digital ad front, Shradha Agarwal, COO, Grapes Digital explained, “When COVID struck advertising went on a freeze. No one was spending except in a few sectors like FMCG, Pharma, and Online Education. All clients wanted to wait and see what will happen. With the ease in lockdown rules, there was some hope but the transactions have still been minimal. Some brands in FMCG and Pharma saw it as an opportunity to do brand campaigns as people were picking anything available on the shelf and loyalty was decreasing with flickering customers, but the spends were not the same. And a lot of brands in retail, hospitality and confectionary reduced the spends to zero or kept it minimal since they were still to see any traction. Hence, the overall spend had to be lower on digital than last year.”
On what determined the change in media plans, Agarwal said: “Since COVID struck us in March, a lot of clients had their summer spring campaigns ready, be it ice cream brands, retail etc., and they were put on pause. In June, I saw all those clients starting on TV as the creative was ready, the season was slipping and ROs had gone to the publishers. But on digital the majority of the spends are on biddable platforms like social media, YouTube, programmatic etc where the spending power is in your control and you have no liability. So we revised all our media plans to literally like 1/4 th budgets. Even in that our priority was ecommerce and the budgets there were also reduced.”
Interestingly, June’20 surpassed the count of advertisers and brands compared to the average count of this January to March. The tally of categories in June and an average of January to March was almost similar.
On what works in favour of digital advertising, Siddharth Devnani, Co-Founder & Partner at SoCheers said, “Digital ads are inherently more adaptable and agile with budgets being optimized day on day. This also makes digital faster to react to the environment, where cutting edge analytics on digital enables planners to change budgets based on real-time campaigns and business performance.”
Talking about the flexibility of the digital medium, he further pointed out that unlike TV, where the minimum ticket size of a campaign makes it viable only for the big brands, far more SMEs spend on digital. “The pandemic and lockdown in India have disproportionately affected different businesses - and only a handful of them are back to spending again. The major contributor to TV ad spends are the FMCG brands. They have continued to enjoy reasonable consumer demand through these four months.”
Now if we compare data for the same period with respect to TV, the difference in advertising volume here too was minimal for June but the difference is lesser than for digital. In April, television saw a drop of 47% in ad duration hours, in May it dropped by 41.67% but in June the least drop was at 6.45%.
Also, for the period January-June ’20 for both TV and digital, the Ad Volumes per day on TV started growing from May ’20 after facing a drop in the previous three months. Whereas for digital, a resurgence in ad insertions per day was observed during June’20 post facing a drop in April-May ’20.
Pointing out why there is some ray of hope, Agarwal said: “When anything goes wrong in sales, advertising and marketing budgets are the first ones to be slashed. But it's been a quarter and the economy has to move, so it will pick up. However, it will not be the same as the budgets we were given in Q1 (January to March). We are hopeful as customers are now tired, clients want to kick start and drive some revenues through some or the other means.”
A look at the top ten categories and advertisers for June shows that advertising volume has witnessed an increase in share as compared to 2019.
According to Devnani, in the coming months digital is bound to grow and may even surpass previous levels. “With a large number of SMEs shifting to online sales, growing smartphone users, and lack of on-ground events or exhibitions in the near future, digital will provide the necessary advertising channels and prove to deliver impact in due course,” he noted.
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