TV will continue to outperform vis-a-vis other traditional mediums: Karan Taurani

As the year draws to a close, Adgully has been doing a recap of all the major developments across M&E, Advertising, Digital, Marketing, Print, Television, PR & Communications along with leading names in the industry as part of the annual REWIND 2021 series.

As opposed to the severe disruptions brought about by the global COVID-19 pandemic in 2020, the year 2021 has been more about resilience and rebuilding.

In conversation with Adgully, Karan Taurani, SVP - Research Analyst (Media & Consumer Discretionary), Elara Capital, speaks about how TV has shown strong recovery in the current environment, and is expected to remain healthy even if a third wave strikes. Taurani also sees positive growth for cinema, local advertising/ SME advertis, as well as revenge consumption in 2022.

Performance & key developments in 2021

The M&E industry has shown strong resilience towards digital in 2021, despite things normalising in H2CY21; many business verticals that had increased exposure towards digital adex, too, haven’t pulled back in the current environment, which is largely normal. TV, too, has been strong as a traditional medium and has recovered back to pre-COVID levels (much earlier than Wave-1 impact) despite negative impact of Wave 2 in Q1CY22. TV will continue to outperform vis-a-vis other traditional mediums like print and radio as it remains favourable for mass campaigns/ brand building. Cinema was another traditional medium that showed strength this year led by success of large scale content, which helped in getting footfalls back to pre-COVID by 70% (for big budget films only).

Projections for 2022

Cinema will continue its promising run, led by a big slate of large ticket films across genres, as footfalls will return to pre-COVID levels; cinema advertising, however, will come back with a lag as pricing has seen a sharp drop recently. Local advertising/ SME advertising will surprise positively and contribute in a big way, and revenge consumption may imply overall ad spends moving up by almost 10-12% higher compared to the pre-COVID levels in CY22; digital and TV will command a lion’s share (~70% contribution) in the M&E pie as both will co-exist, with digital advertising growing almost 2.5-3x that of TV advertising backed by higher penetration and consumption.

Consolidation may happen in the TV industry, which will propel synergies and better growth for select players, whereas it is too early to call out any major consolidation in digital as of now. In case of a third wave due to the new variant, all traditional mediums would struggle and recovery would be further delayed, except TV, which remains healthy; digital will continue to be the least impacted in case of third wave as shift to digital media would accelerate further.