Exclusive: Mindshare forecasts 12% media spends growth in 2012; it was 13% in 2011

31 Jan,2012

By Johnson Napier


For all the doleful talk of the economy heading south and brands slamming their ad-spend doors on media, sceptics are in for disappointment as the industry managed a commendable growth story for Calendar Year (CY) 2011, clocking a growth rate of 13 percent. Further, with net revenues totalling Rs 33,388 crore, the media confirmed its status as being ‘unstoppable’ and guaranteeing advertisers a good bang for their buck. The results were the finding of a study put together by GroupM, led specifically by the team at Mindshare. Titled ‘This Year, Next Year: Indian Media Forecast’, the study highlights the positive growth story that was witnessed by the industry, especially in the first half of CY 2011.


Continuing with its strong projections and putting aside fears of a financial downturn, the study hints at 2012 to deliver growth numbers in the range of 12 percent and net revenue to the tune of Rs 37,397 crore. This will be driven largely by the advertisers’ willingness to deploy budgets around the media of television, print, radio and digital, the study notes.


Throwing light on the report and its findings, Ravi Rao, Leader, South Asia, Mindshare commented, “The economic outlook is something that one can never get the handle right, with most studies not agreeing on one number. But this is what makes it exciting to look and estimate the Adex growth in India. GroupM does yeoman’s service of providing some startling numbers based on science than the gut, even though India tends to buck the trend away from global predictions.”


The detailed forecast and sector-wise spend analysis are part of ‘The Mindshare Indian Media Forecast 2012’ report published by MxMIndia and presented by UTV Bindass (Details on how you can get your copy at the end of this report)


On the growth pattern to be expected by the industry in 2012, Mr Rao affirmed that since October of 2011, the moment the Eurozone market failure triggered a downslide the thoughts are very much soft where advertising budgets are concerned. “But if you look at the growth driver – every media is expected to grow in double digits with the exception of print and out of home. Every broadcaster and publisher is trying ways and means to cut down input costs while trying to extract the maximum. The first four months of this year will show the trend for the year, but the challenges are aplenty for media,” he asserts.


On the performance of several domains in 2011, Jai Lala, Principal Partner – Exchange, Mindshare said that in terms of Adex, one of the media that stole the thunder last year was television. “In the first half of the Calendar Year (CY) 2011, the medium of television grew as high as 26 percent, which then slowed down to a rate of 16 percent in the second half. So while the average growth for 2011 for television hovers around 20 per cent, 2012 is anticipated to put up numbers in the range of 16 percent. But unlike last year, we expect the first half of CY 2012 to show a slow growth while the second half will manage to show a sudden spurt in growth numbers.”


According to Mr Lala, the properties that will be churning out the numbers for television in 2012 includes cricket – led largely by IPL, reality shows, regionalisation and digitisation. They will be backed by increasing advertiser interest particularly from the sectors of auto, FMCG, finance, IT & ITES, retail, etc.


As for the performance of the other big contributor to Adex – Print, the study envisages a growth of 8-9 percent for 2012. “This is due to the fact that there is going to be a certain amount of demand through elections and the possible bounce-back of certain sectors like auto, real estate, etc who will continue to look at print as a viable advertising option,” states Amin Lakhani, Principal Partner – Exchange, Mindshare. Another factor that will drive the fortunes for Print will be speciality magazines. “Being subscription-based and catering to niche audiences, these magazines will continue to attract the attention of the advertisers as well,” states Mr Lakhani.


Continuing with its solid growth story in 2012 as well, digital is pegged to achieve a growth rate of 30 percent. Apart from servicing the many needs of the online and mobile worlds, marketers are expected to increase their focus on people during the ongoing year. Affirms Mr Ashok Lalla, Leader – Digital, South Asia, Mindshare, “In 2012, the most important media channel that smart marketers will increasingly focus on will not be specific Social websites, TV channels, print publications or radio stations, but it will be People. All the rest of the media mix will be oriented around activating a brand’s audience (People) to be the key driver and proponent of a brand’s communications.”


As for radio, the biggest event that will change the fortunes of the radio industry in 2012 will be Phase 3. According to the study, Phase 3 will help radio owners to drive some incremental revenues. The only stumbling block, the study notes, would be measurement that will have to pan itself to include other cities and towns as well. A growth rate of 11 percent is what is expected out of the medium for 2012, the study notes.


With Out-of-Home, the study notes that the formation of the IOA would lead to standardisation of rates and other operational modalities that will help push for more research into the medium. This effort by the industry would be recognised by clients who will go all out and invest in the medium, it states. “Marketers want to use outdoor as they provide good imagery and high visibility. It has even allowed for newer and better innovations to help advance the sector. Also, outdoor panels, screens, LEDs are now shaping up a new revenue stream which is now getting separately classified as retail. So the medium has come into its own and will continue to grow at a healthy rate in 2012 as well,” notes Mr Lakhani.


Contributing silently but significantly, Cinema will continue to put up good numbers in 2012. The growth projections for this medium would be in the range of 14-15 percent for 2012, the study notes. Sector wise, a large range of advertisers would continue to pursue the medium as an effective advertising option.


‘The Mindshare Indian Media Forecast 2012’ report is presented by UTV Bindass and being distributed to select marketing and media professionals across the country starting today. If you want to make sure you get a copy, please write to us at editor@mxmindia.com writing MIMF2012 in the subject line. And, yes, while we are sure you’ll find it priceless, it’s not a priced report.


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