Have news channels become lucrative for FMCG brands due to GECs opting out of Free Dish?

Industry experts agree that elections are a big reason behind this shift, but it is not the only reason for a surge of FMCG brands on news channels

e4m by Moumita Bhattacharjee
Published: May 17, 2019 8:50 AM  | 5 min read
FMCG ads

News channels, be it Hindi, English or Regional, have been seeing a distinct surge in viewership this year due to the many big events taking place. The Pulwama attack, strikes on Pakistan and now Election 2019 have all been extensively covered and the genre has become the best bet for advertisers. There has been a rise in the FMCG brands advertising on news channels due to these big events. But the Election is not the only reason for that.

We spoke to industry experts who pointed out that the withdrawal of some GECs from the Free Dish has also led to an increase in the ad volumes of FMCG brands on news channels.

Explaining this trend, Vikas Khanchandani, CEO, Republic TV, told exchange4media earlier, “This isn’t happening just because of elections. It’s overall and this is happening because Hindi news, especially FTA, is delivering very high reach today. It even measures up to what a GEC serves up in terms of reach. More importantly, it is exclusively serving rural audiences because most of the big GECs are not on the Free Dish platform. It is important that the FMCGs have a huge presence on Hindi news because there are limited platforms available for them to get that audience.

There is a huge decline in rural GRPs that they were getting from these channels. There are very few entertainment movies, news and music channels available on the FreeDish platform. So that 30mn homes are equivalent to almost 100 million people, that’s because it’s community viewing in rural areas rather than personal viewing. Those audiences are now far better available on Hindi news platforms.”

As per reports, many broadcasters had pulled out their Hindi Mass Entertainment channels from DD Free Dish post the TRAI's NTO came into effect. This included Colors Rishtey, Zee Anmol and the likes.

Avinash Pandey, CEO, ABP News Network, asserts that news genre was always extremely lucrative for FMCG brands. “For example, Patanjali, Emami, Dabur, they are heavy spenders on news anyway. Even Colgate, they were a big spenders on news last year and last to last year.” But he admits that the absence of Tier-II GECs has helped the share of news channel. “If you look at Television overall movement, obviously because of the DD Free Dish, news became extremely popular amongst the rural audience. If you see the overall DD Free Dish pattern, it was the news genre which went to it first. That led to the expansion of the same. Finally, a service provider will expand only when there is content. It was then further joined by Tier-II GECs which have been withdrawn. That has resulted in those GECs’ reach is down by close to 60-80%.

At present, the news genre is itself doubled the size of what it used to be due to the election coverage. The lack of availability on the DD Free Dish of some GEC channels makes Hindi news most lucrative medium to buy currently for all product manufacturers including FMCG. Those companies who work on the CPRP, CPT models, news is extremely efficient. In fact, it is grossly under-priced. You are getting 90mn or 100 mn reach almost half the cost of what GECs will charge. Advertisers should realise that it is an effective model and obviously the absence of Tier-II GECs has helped the share of news channel."

Bashab Sarkar, Sr.VP-Media, Emami Ltd, revealed how it has been a boon for their company. “It’s true that large channel networks have not participated in the DD Free Dish Auction mid-February 2019 which had an immediate effect on their FTA GEC ratings from March. As a result, the weekly GRPs of the two remaining channels with DD Free Dish benefitted. This was a boon for advertisers such as Emami, especially for brands with a rural focus. The news channels, particularly Hindi ones came into focus grabbing eyeballs with elections and other major developments around the country, thereby boosting its advertising revenues.”

Rajiv Dubey, Head-Media, Dabur India Ltd. agreed that there has been a shift of monies from these erstwhile FTA channels to the news channels. “Typically FMCG looks at reach numbers as well and to get those reach numbers through news channels is extremely difficult. However, there has definitely been a shift of monies from these erstwhile FTA channels to the news channels because of other reasons and not just the TRAI’s NTO. News channels per se have become a very attractive thing to buy because of the buzz in the marketplace. News channels are an extremely important genre to buy. We will continue to invest in news genre. It’s very current and a large number of people watch it. It gives a very good volume of viewers. They are a very light viewer and the viewer is very discerning. People who have money are on this genre. Whereas in GECs, those viewers you can get anywhere.”

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