Indepth: TV Vs digital debate revisited - will they continue to complement each other?

For a long time television has remained as a preferred medium for advertisers and brands to reach their target audience. However, the rapid transition to digital during the pandemic period has given this medium a leg-up. So much so that GroupM is its ‘This Year Next Year’ ad spends forecast earlier this year projected that digital ad spends will overtake TV ad spends for the first time in 2022, registering a growth of 33 per cent. According to the report, digital advertising is expected to surge to capture 45 per cent share, ahead of TV’s 39 per cent share. The report also pegged India’s total ad spends to reach Rs 107,987 crore in 2022.

As we enter the last quarter of the calendar year 2022, Adgully looks back at how TV advertising has grown during the year and whether it will lose out to digital. This is not the first time that television has come under the cloud and has felt the threat from digital. Most of the industry experts that Adgully spoke to strongly vouched for television, and gave several reasons that continue to make television a strong medium for brands and advertisers.

At the same time, the industry experts also pointed out that the rapid march of digital can’t be ignored and added that digital ad spends could equal, if not overtake, television ad spends. The phenomenal rise of OTT, growing adoption of connected TV, technological boosts offered by 5G, metaverse, etc., also point out to an evolving media landscape.

TV still strong

Does the good old TV face an existential threat? Marketers feel that despite everything, TV still remains the undisputed leader when it comes to advertising.

Television as a mode of communication continues to have an insurmountable reach, points out Abbey Thomas, Head of Marketing & PR, Volkswagen Passenger Cars India. “There are currently over 210 million TV households and 891 million individuals in India prefer TV as the standard mode to tune in for entertainment, news, and events. Despite the increasing popularity of OTT video ads and streaming services, television remains predominant because of its unparalleled reach, which makes TV advertisements a strong medium for brands to connect with their audiences. There was a skewed inclination towards digital during the pandemic but it is now returning to balanced levels. The weightage given to TV and digital has definitely evolved; however, TV continues to dominate since it is still the best awareness platform. Digital platforms are relevant more from an audience engagement and purchase consideration perspective. Customers go through automotive portals for product familiarisation, comparison and expert and user reviews before purchasing a vehicle. For 2022, our media mix comprises of 55% ATL activities including broadcast/TV, OOH, print while the other 45% is focused on digital platforms and social media,” explains Thomas.

Krishnarao Buddha, Senior Category Head, Parle Products, too, emphasises that TV medium continues to be the preferred medium for brands and advertisers like Parle. At the same time, he also states that over the past few years, an increase in spends on digital medium has been observed as well.

Meanwhile, Pradeep Dutta, Head of Branding, Advertising and Alternate Channel, Panasonic Life Solutions India, foresees that digital advertising will equal TV advertising very soon. “With the advent of digital advertising, brands shifted their focus in building their digital capabilities. It’s very evident that the future would be all about reaching out to consumers through digital platforms,” he adds.

“Industry reports indicate that digital advertising in India is expected to equal television advertising and may even surpass the latter by 2023. The pandemic has further pushed the envelope towards digital and, hence, brands are keen to explore more of it. At Panasonic Life Solutions India, we have doubled our digital marketing spends since last year. However, television still maintains the largest share of media spending,” says Dutta.

QYOU Media India CEO Simran Hoon feels that TV will continue its domination for the next decade. “Taking into consideration that India prevails as a single TV household with a more family viewing proposition, television as a medium has been successfully providing brands and advertisers with an opportunity to reach out to a wider set of audiences. While the industry has witnessed a gradual shift towards digital, TV continues to dominate the pie and will do so for the coming next decade. The advertiser-television relationship is and will strongly grow and evolve due to its sheer reach and strength,” she says.

“In the past few years, the industry has seen an accelerated shift towards digital mediums of advertising,” says Saurabh Baishakhia, President, Appliances at Usha International.

According to him, the pandemic acted as a catalyst boosting digital advertising and it continues to remain relevant in today’s screen-first world.

“In line with this, we at Usha are consistently working towards ensuring seamless browse-to-buy online purchase journeys for our consumers. Having said that, Usha is a household name across India and, for us, all touchpoints play equally significant roles in building brand recall for our products – be it TV, OOH, digital, or contemporary platforms i.e. OTT. In fact, footfall at brick-and-mortar stores has increased exponentially as markets are now fully open, as well as a rapid proliferation of online shopping by new-age shoppers. We are witnessing growth across both online and offline channels, thanks to our omnichannel approach, as part of which we enhance the consumer interface with brand Usha by giving unique shopping experiences for consumers across purchase channels. Our advertising and marketing efforts are spread across platforms, with our ad expenditures across touchpoints having touched pre-covid (2019) levels,” said Saurabh Baishakhia.

In near to medium term, TV will continue to stay relevant and will keep drawing its share from the marketing pie, says Sidharth Singh, Co-founder at CupShup. He feels that the inherent advantages of TV medium are its strength.

“It looks like that only way from here is downwards, but if you look closely, it remains the de facto entertainment option in the drawing rooms of majority of Indians. Its undisputed kingship comes from two factors. One is that you can watch it with your family without thinking much. The content has already gone through multiple levels of approval for family consumption. Secondly, you need not programme and condition yourself mentally what to watch. The fingertips take you through the glossary than an algorithm about what and when to watch. In a world where brain has already done much throughout the day, TV offers a platform to relax and let you entertain,” says Singh.

Whoppl founder-CEO Ramya Ramachandran vouches for a balanced ecosystem, wherein both forms exist. “As Indian content consumers are already beginning to interact more with social media platforms than television, I believe there is going to be a significant shift in preferences in the next couple of years. One of the main causes of this shift in preference can be the rise in OTT platform viewership. We must say that the emergence of digital has resulted in some major changes, but when we examine the demographics of the overall audience, we notice that there is still a higher probability of relying/trust on television content. Hence, it’s important to have a balanced ecosystem,” says Ramachandran.

Connected TV and the changing landscape

In the western markets such as the US, cord-cutting became a reality a long time back. Though it is yet to catch up on a massive scale in India, the spectre is still hanging, thanks to the increasing popularity of streaming platforms, ably aided by cheap data plans and the high penetration of smart phones.

Sidharth Singh feels that TV is fast losing its lustre due to multiple reasons such as the recent TRP scam. “Advertising spends are a function of audience stickiness and thus, this goes without saying that OTT has been chipping away the advertising spends earmarked for TV. Numbers sliced and diced form the bedrock of the manner in which the spends get distributed, and OTT platforms have been gaining significantly on this front. TV loses on this as there are limited ways in which the impression and impact can be measured. Also, the recent scams surfaced points to manipulation of TRPs, which has taken away steam out of TV’s bandwagon. Having said that, smart TVs are fast catching up and in abroad CTV (Connected TV) is providing much better insights and thus targeting for advertisers,” says Singh.

As the reach of smart TV increases, we will get much better insights and targeting about audiences’ likes, dislikes and preference, says Singh. “Apart from that, the OEMs’ data will serve as DSPs (Demand Side Platforms) for advertisers, thus giving OTTs a run for their money. Thus, while prima facie OTT looks a better bet, rapid penetration of smart TVs coupled with effective utilisation of data by OEMs can change the game in good old idiot box’s favour. The future looks exciting,” he adds.

Seeing the connected TV growth in the past two years, TV would not be the preferred medium for brands after a few years, feels Vishal Agrahari
AVP Media BC Web Wise

Now, digital is not just restricted to mobile and desktop device, Mehta points out. Samsung smart TV has 300 million users, Xiaomi/Mi has 400 million users; so TVs are becoming digital and it will open a new era of advertising with a blend of digital targeting to TV. Connected TV has 45 million reach and by 2025 it will reach 120 million. The subscription of content on connected TV is much cheaper. With an annual subscription of Rs 1,000, users can see all genre content on OTT. 5G services have just launched in India and this will further push traditional TV watchers to Connected TV. Also, with Martech coming in, opportunities to engage/ experience for users on TV will also increase with VR and mataverse,” he says.

Mehta asserts that the advertising landscape has changed with the arrival of digital. “Yes, it has changed. Digital measurable metrics and martech capabilities for top-to-bottom funnel have given more allocations to digital than other mediums. By 2023, digital ad spends will be equal to TV ad spends, whereas other mediums such as print, radio, and outdoor ad spends being cut. Digital media is expected to have a 29.5% CAGR to reach a market size of Rs 35,809 crore by 2023,” he says.

Arrival of OTT

The arrival of OTT platforms has changed the audience demography in a considerable way with a large chunk of urban youngsters turning to streaming. And there is the increasing influence of digital media. How do these aspects affect the advertising plans of brands and media agencies? Going forward, will TV remain as a preferred medium of advertisers and brands, or will its relevance diminish with digital and streaming media platforms gaining prominence?

According to Pradeep N Dutta, OTT platforms have been increasingly strengthening their presence across audience demographics. “This has led to an uptick in the user and viewer base. A FICCI-EY report which released early this year pointed that audio and video streaming subscribers in India rose to 80 million in 2021 from 50 million in 2020. Hence for consumer brands like PLSI, OTT platforms are becoming relevant than ever. We expect that it will become a mandate for brands across categories to park a part of their budgets for OTT advertising going ahead,” says Dutta.

“We have observed a huge rise in OTT platforms fuelled by high-speed data and low-cost smart phones along with a pandemic forcing high usage of devices for online classes and work-from-home activities. There has been a high incidence of usage of broadband and WiFi services fuelling further growth in the consumption of content on OTT platforms. As a result, we have increased our presence on most of the OTT platforms significantly over the past couple of years,” says Krishnarao Buddha.

The rising popularity of OTT platforms has transformed the entertainment experience for all demographics, says Abbey Thomas.
“From ‘Let’s go for a good movie’, Indian audience transitioned to ‘Netflix and Chill’. As per the fourth edition of the Indian Over-the-Top (OTT) Platforms Report 2021 (post-pandemic consumption), published by MICA, consumption of content across OTT platforms in 2020-21 was the highest among viewers aged 15-34, revealed. The urban youth and rural audience with the higher penetration of smart phones and internet connectivity have become an important part of the OTT subscriber base. We are also witnessing users shifting from paid TV subscriptions to Internet-based streaming services, which has led to the immense rise in OTT universe – from just two OTT platform in 2012 to about 40 players at present. The OTT revolution has come a long way in India,” he says.

According to him, this attitudinal transition has built strong inroads for the digital medium, thus opening doors to numerous possibilities for brands to connect with their audiences. The digital medium, he adds, has witnessed a 2X growth as compared to traditional media on a Y-O-Y basis. “As advertising is driven by consumer engagement and behavior, we do see a substantial rise in influencer marketing. For the effective delivery of key campaigns, brand or product awareness, driving customer aspirations, influencer marketing adds great value and is part of the advertising plans of a brand. At Volkswagen as well, we engaged with new-age influencers for our newly launched products Taigun & Virtus campaigns,” he adds.

Krishal Mehta feels that the increasing influencers of digital media affect the advertising plans of brands and media agencies. “The youngsters from not only metros, but Tier 1, Tier 2 are also reachable on digital with precise targeting of affinity. There is consistent growth of internet penetration across the country regions due to short-form video content and OTT which is free available and these aspects are affecting the advertising plans,” he adds.

“TV ads still contribute to the major chunk of the spends. However, reports indicate even as the advertising industry faced inflationary headwinds during the pandemic; the ad revenue for most OTT platforms remained buoyant in the first half of 2022. While factors such as unique content and increasing brand spends are key reason for advertisers to lean towards digital, we will have to wait and watch for the situation to evolve,” observes Pradeep N Dutta.

Abbey Thomas feels that TV will continue to dominate the scene in a country like India. “Streaming services such as Netflix, Disney Hotstar, SonyLIV, Amazon Prime, etc., are proliferating. However, this change has not negatively impacted television viewership. The popularity of TV has remained steady and withstood the test of time and it is still the largest consumption touchpoint with 891 million individuals connected to it. For the next few years, TV will continue to be a priority medium for advertisers and brands in order to reach a large audience in a country like India. However, from an audience point of view, advertising is more likely to be encoded in long-term memory if there is a unified 360-degree approach, including all prominent mediums right from television, print, OOH, and social media, to ensure the right message is delivered to customers,” he points out.

As a result of younger viewers shifting to OTT platforms and the rising surge of content creators, there has been a change of consideration in the audience, says Ramya Ramachandran. But if we focus on the elderly audience or people from Tier 2 or 3 areas, we can find television more popular amongst them. Also, due to the rise in bundled deals/packages that are available with a recharge or given as a free reward, we’ve seen an increase in customer base in the specific OTT platforms. With the increase of smartphone usage in India, we’ve seen an increase in viewership too, says Ramachandran.

She foresees new ways of advertising in the days ahead. Already, she adds, we’re looking at in-shows brand integration and subtle product placements in OTT shows. According to her, moving forward, with the increase in viewership, shifting from mainline to digital we do see new ways of advertising the brands online.

“Having said that, a large chunk of the audience in India still watch TV and to have a multi-platform approach would be viable. The emergence of digital media and the transition of the younger audience demographic from television to OTT platforms will undoubtedly bring about some options for brands to reach out. Brands and advertisers will need to adapt their strategies in order to reach the younger demographic by incorporating digital in their strategy,” Ramachandran says.

Krishnarao Buddha is optimistic about the future of TV. Going forward, he expects TV to remain a preferred medium of advertisers and brands considering the deep rural penetration of the television medium. “We can surely expect a rise in consumption of targeted advertising on digital medium over the next five years. Events like the introduction of 5G services will further propel the growth in the digital medium.”

While digital undoubtedly has grown to become a must-have for brands, television continues to exist as an effective and efficient medium, says Simran Hoon. She feels that going forward, both will co-exist and complement each other.

When it comes to advertising, she adds, an integrated approach is far more effective. “Also, a general media plan cannot be applied to all categories. There are different strokes for different folks. Brands and advertisers are always on the lookout for new ways to reach out to their consumers and prefer the medium that sells the most. At QYOU Media India, we believe that both these mediums will continue to complement each other with television delivering reach and digital deepening brand engagement. With continued headroom for growth, TV is poised to offer a strong prominence to brand categories such as FMCG and e-commerce, ensuring mass targeting while digital is preferred for brands that aim to target a niche set of consumers,” she says.

TV’s relevance will not diminish so soon and will still be considered in the plan for the broader reach at target frequency, asserts Krishal Mehta. “The premium and high TRP content and sponsoring big events on TV will keep its relevance alive for top funnel reach campaigns. Planners will put more allocations in the mid and bottom funnel, which will be majorly on the digital,” he adds.

On the other hand, Rithesh R, Co-Founder, Deepsense Digital Solutions, notes that the landscape has changed with the increase in digital penetration across India. “Now beyond social, people have started watching their favourite shows and sports in OTT. For example, Hotstar reported 1.5 crore people watch the India vs Pakistan match on Hotstar. It is 1.5 crore concurrent users, and with digital they can interact with the ads too. Consider 0.5% CTR, the traffic is very high to their CTA. So, brands are moving towards data-oriented decision-making and that’s where digital plays major role,” Rithesh says.