India’s ad spends grew 3.5 pc at Rs 17,356 crore in 2007

Lintas Media Guide 2008
exchange4media Mumbai Bureau

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While print continued to hold major share with 50 per cent of the total media spends with Rs 8,591 crore, Internet as a means of advertising saw an increase in ad spends of 43 per cent compared to last year, reaching Rs 215 crore. Radio, cinema, and outdoors, on the other hand, capitalised on innovations and saw an increase of 28 per cent, 16 per cent and 17 per cent, respectively, reaching figures of Rs 529 crore, Rs 194 crore and Rs 1,062 crore, respectively. TV ad revenues showed a decline of 0.8 per cent at Rs 6,766 crore as a result of competitive pricing offered by GECs to retain their market share.

Lynn de Souza, Director, Media Services, Lintas Media Group, said, “There are some surprises in store – ad spends have grown by a mere 3.5 per cent in 2007 over 2006, reaching a figure of Rs 17,356 crore, largely due to a fall of 1 per cent in TV expenditure, with large advertisers moving into more cost effective channels, slots and durations. With increasing media reach amongst the rural masses and the urban youth shying away from mass media, 2008 is set to offer enormous advertising opportunities as well as tremendous challenges.”

In television, with the number of channels likely to touch as many as 500 in the next two years, television as an industry is growing at a dynamic pace. Though the direct impact of this is going to be greater ad avoidance, but the time spent on watching any channel has moved up. Also, with this burgeoning increase in the number of channels, the distribution of these channels is rapidly changing. As of now, India is Asia’s second largest pay TV market after Japan. By 2015, it is expected to be the largest pay TV market surpassing the current leader.

In print, with literacy levels rising to 551 million people in India, more people in rural and urban areas are reading newspapers and magazines today. Current estimates reveal that the reach of print media in India has increased to 316 million people. Print media is also the favourite segment for global investors with maximum foreign investment in this segment. 2007 saw launches of many niche magazines like the ‘Vogue’, ‘Economist’ and others. The print media industry still has the potential to grow as 236 million literate people in India are still not tapped by any publication.

Of the total amount spent on ads in India, radio is estimated to have a share of 3 per cent in 2007. This share is expected to rise to 5 per cent during 2008-09. As per a FICCI-PricewaterhouseCoopers report, the opening of new radio channels has provided a boost to creative content. The demand can be estimated to as much as 1.5 million hours of content annually for around 300 channels.

Source: © exchange4media 2008