Two years on, ISEC still awaits take-off

Two years after its launch, the Indian Socio-Economic Classification (ISEC) finds itself at a crossroads—caught between advertiser demand for sharper consumer targeting and what industry executives describe as stiff opposition from broadcasters, which is believed to have slowed its progress.

Introduced by the Market Research Society of India on February 21, 2024, as a successor to the New Consumer Classification System (NCCS), ISEC was envisioned as a more contemporary framework to decode India’s evolving consumer landscape. However, despite early momentum and strong advertiser backing, it has yet to move meaningfully towards industry-wide adoption.

“Conversations around ISEC have virtually stopped,” CMOs of two leading FMCG majors told e4m. Requesting anonymity, broadcasters too admit, “There has been no discussion at all on ISEC with any industry body across the Indian Society of Advertisers (ISA), Indian Broadcasting and Digital Foundation (IBDF), MRSI or Broadcast Audience Research Council (BARC) over the past year and a half.”

According to multiple industry stakeholders, pushback from broadcasters—particularly General Entertainment Channels (GECs)—is widely seen as a key factor behind the stalled implementation of ISEC, though there has been no formal articulation of opposition from the IBDF.

Notably, ISA had backed ISEC within days of its unveiling, shooting off its support letter to BARC. However, when BARC initiated discussions around implementation, broadcasters were understood to be cautious in their response. A taskforce involving all stakeholders to study the ISEC’s impact on TV channels was also proposed at that time, but is believed to have not materialised.

“Since IBDF put its foot down soon after the launch, there has been little movement on ISEC—even though advertisers need it. NCCS clusters nearly 70% of consumers into the topmost bucket A. ISEC, by incorporating women’s education, could help us better identify the top 50 million consumers driving urban consumption,” the CMOs said.

e4m reached out to IBDF President Kevin Vaz, ISA President Sunil Kataria, and BARC CEO Gaurav Banerjee to have their perspective on ISEC implementation. Their responses were awaited at the time of publishing. Responses from leading entertainment networks such as Jiostar, Zee and Sony were also awaited.

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TRPs and ad revenue concerns?

Broadcasters—particularly General Entertainment Channels (GECs)—are believed to be cautious about the potential impact of ISEC on audience measurement and, by extension, advertising revenues.

A shift in classification could alter Television Rating Points (TRPs), especially if it captures behavioural changes such as the migration of affluent audiences to OTT platforms.

“There is a concern that ISEC could show a decline in certain premium audience segments on television, particularly educated women who are increasingly moving to streaming,” said a broadcaster.

Such an outcome, industry executives suggest, could have implications for ad revenues, even though no formal study has quantified this impact so far.

Interestingly, not all broadcasters appear aligned. Some news channels are understood to be more supportive of ISEC, believing a revised classification could improve their relative positioning.

However, for large GEC networks, the issue is seen as more structural.

“When 70% of ad dollars are moving towards digital and FMCG players themselves are shifting spends to digital. From a TV standpoint, ISEC is not very relevant now,” a senior executive at a leading entertainment network told e4m. 

This points to a broader realignment in industry priorities. As digital platforms enable granular, real-time targeting and measurement, the imperative to overhaul legacy classification systems—originally designed for television and print—appears to be waning for some stakeholders.

Advertisers, however, contest this view. “ISEC remains critical even in a digital-first ecosystem. If anything, resistance to updating the classification framework could further erode television’s share of ad revenues,” said the marketing head of a leading FMCG company.

Structural and operational roadblocks

Beyond stakeholder alignment, structural challenges continue to hold ISEC back.

The most critical gap is the absence of comprehensive research mapping viewership behaviour under the new classification. While MRSI has developed the framework, its validation would require integration with BARC’s measurement systems.

Operationally, the transition is equally complex. BARC’s existing panels are built on NCCS, and migrating to ISEC would require recalibration—potentially disrupting weekly ratings data and necessitating a phased rollout over several months.

Funding constraints have further compounded the issue. “Due to global economic constraints and shrinking ad dollars, television media is already under stress and hence unwilling to shell out money for any research which may possibly backfire them,” industry insiders claimed. 

Besides, an insider indicated that the competition watchdog Competition Commission of India’s probe against industry bodies for alleged collusion and unfair trade practices is also believed to have slowed the momentum around new initiatives.

Advertisers remain invested

Despite the slowdown, advertisers continue to back the need for a more refined classification system.

“The need hasn’t gone away—if anything, it has become more critical,” said a senior marketer. “As consumer behaviour fragments, sharper segmentation becomes essential for efficient media spends.”

At the heart of the debate is the growing inadequacy of NCCS. Critics argue that its reliance on the education of the primary wage earner and ownership of consumer durables has lost relevance in a market where such assets are increasingly ubiquitous.

“Consumer durable ownership can no longer be a reliable indicator in the era of easy credit and 0% financing. The system has become less discriminatory and unstable as often 70 percent consumers fall in just category A or A+B categories,” CMOs noted, citing their inability to target affluent urban classes. 

ISEC attempts to address this by incorporating occupation of the primary earner along with the education levels of both male and female members—offering a broader and arguably more contemporary measure of social capital.

Adoption takes time: MRSI  

When asked about the roadblocks in implementation of ISEC, an MRSI spokesperson stated, “We introduced the ISEC keeping in mind the country’s evolving socio-economic landscape and the need for a more contemporary and relevant classification framework. ISEC offers a more holistic lens to understand Indian households and consumer segments. As an industry body, we remain deeply committed to supporting the growth and evolution of the insights ecosystem to help businesses grow.”

“As with the introduction of any new framework, even globally, adoption and implementation take time. We are working closely with our members and stakeholders across the industry to implement ISEC. We will continue to support the industry in every possible way to enable the smooth implementation of ISEC,” the spokesperson added.