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Advertising spends pick up during festive season, but only at half the rate of 2018

Ecommerce companies and handset brands were the biggest spenders this festival season. Consumer durable brands also returned after a long hiatus, but FMCG advertising spend was flat

twitter-logo Ajita Shashidhar   New Delhi     Last Updated: November 1, 2019  | 22:22 IST
Advertising spends pick up during festive season, but only at half the rate of 2018
Auto companies also stepped up their ad spend in order to get rid of inventory

Advertising spends are an indicator of the health of the economy. After months of tepid growth, the festival season has seen an 8-9 per cent growth in ad spends. Though moderate compared to the 13-14 per cent increase in festival advertising spends last year, the media industry is happy that the advertising clock has finally started ticking. Ecommerce companies and handset brands were the biggest spenders this festival season. Consumer durable brands also returned after a long hiatus, but FMCG advertising spend was flat. Auto companies, which have undergone huge erosion in demand, also stepped up their ad spend in order to get rid of inventory.

As opposed to brand-building the messaging this year was on enabling short-term festival sales, says the sales head of a leading broadcast network. While television has been the biggest beneficiary in value terms, most brands increased digital spends. "A lot of digital spend this year was on a search and programmatic and not on pure display ads. The ads were more output-driven," says Anand Bhadkamkar, CEO, Dentsu Aegis India. Bhadmakar, says that newspaper ads were last moment insertions to announce festival offerings. "Most of the festival advertising was targeted and result-oriented, as opposed to wooing consumers on the back of emotions," he adds.

Also Read: Festive sales: Cashback, discounts, freebies drive up smartphones, consumer durables sale

Though general entertainment channels like Star Plus, Colors and Zee TV saw a surge in advertising this festival season, there were limited takers for niche channels. In fact, post the new tariff regime (which allows a consumer to subscribe to only those channels which she wants to consume), the advertising revenue of niche channels, especially English genre channels, are known to have been severely impacted. These channels have not got respite even during the festival season as the NTO has curbed their reach.

Most companies, especially FMCG brands, advertise on television in order to reach out to a wider audience, but thanks to the NTO, most refrained from spending. Advertisers, says the sales head of this broadcast network, have not been spending for the most part of the year due to a slowdown in consumption as well as the NTO. But festival season spends according to him are an indication of the return of normalcy.

Bhadkamkar of Dentsu says that the steps taken by the Government such as reduction of corporate tax has led to the revival of the ad spend appetite of advertisers. "Most brands which were originally planning to spend only during the festival season are now open to spending through the year." However, aggressive growth in ad spends is still a few quarters away, say ad industry stalwarts.hnology will provide key infrastructure for the development of China's digital economy, and the combination of 5G with artificial intelligence, big data and other technologies will revolutionise the form of the digital economy.

Also Read: Amazon Wholesale India revenue dips 8% to Rs 11,232 crore in FY19

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