TV ad growth drops to 11% H1 2016; total ad market growth rate at 12.9%

Following review of the advertising expenditure in H1 2016, Madison Media has stated that growth in all media is more or less as per its original projections released earlier in the year, however, there is a slowdown in TV advertising growth rate. Against the projected growth of 20 per cent in the TV advertising for the full year, only 11 per cent growth is achieved in H1. This compares poorly with the 35 per cent growth rate achieved in H1 2015 over H1 2014 on the back of substantial increase in e-commerce spends and ICC World Cup.

Drop in growth rate of TV advertising is also the main reason why the total ad market growth in H1 2016 is only 12.9 per cent. This leads to a drop in 2016 annual growth forecast from 16.8 per cent to 13.2 per cent.

Most genres have reported lower FCT telecast in H1 2016, except Hindi Movies and Kannada channels.

Sam Balsara, Chairman, Madison World, commented, “The drop in growth rate of TV advertising does not augur well for the economy as generally a spurt in ad spends leads to higher GDP growth.”

Vikram Sakhuja, CEO, Madison Media & OOH, noted, “The drop in growth rates in TV is led by a lower contribution of e-commerce, which is a category known to pick and choose high priced inventory/ impact programmes and substituted by FMCG users, who resort to everyday advertising and seek high value for money.”

Madison expects this trend to continue and if so, the year should close just shy of Rs 50,000 crore.