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Madison Media revises 2016 annual growth forecast from 16.8% to 13.2%
TV growth rate in H1 only 11% compared to last year 35% and projected 20% for full year. Total ad market growth rate in H1 12.9% versus projected 16.8% for full year
BestMediaInfo Brueau | Mumbai | August 12, 2016
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Upon review of advertising expenditure in H1 2016 Madison Media finds that growth in all media is more or less as per its original projections released earlier in the year, but there is a slowdown in TV advertising growth rate. Against the projected growth of 20% in the TV advertising for full year, only 11% growth is achieved in H1. This compares poorly with the 35% 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%. This leads to a drop in 2016 annual growth forecast from 16.8% to 13.2%.
| Ad Spends (Rs. Crores) | ||||||
| Medium | 2015 Actual | 2016 Original Projection | 2016 Revised Projection | 2016 Original growth% | 2016 Revised Growth % | 2016 H1 Growth % |
| TV | 17261 | 20713 | 19160 | 20 | 11 | 11 |
| Press * | 16935 | 18629 | 18629 | 10 | 10 | 9 |
| Radio | 1545 | 1823 | 1823 | 18 | 18 | 13 |
| Cinema | 465 | 535 | 535 | 15 | 15 | 13 |
| Outdoor | 2665 | 3010 | 3010 | 13 | 13 | 13 |
| Digital | 5120 | 6656 | 6656 | 30 | 30 | 37 |
| TOTAL | 43991 | 51365 | 49812 | 16.8 | 13.2 | 12.9 |
* Excl tenders/appts/classifieds
Most genres report lower FCT telecast in H1 2016 except Hindi Movies & Kannada Channels.
Sam Balsara, Chairman, Madison World, said, “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, added, “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.”
| Rs. in crores | Television – Category spends and contribution | |||||
| Product Categories | H1'15 | H1'16 | Growth % | Growth Cont. | Category Cont. H1 2015 | Category Cont. H1 2016 |
| Alcoholic Beverages | 96 | 150 | 56% | 5% | 1% | 1% |
| Auto | 773 | 795 | 3% | 2% | 8% | 8% |
| BFSI | 207 | 222 | 7% | 1% | 2% | 2% |
| Clothing Fashion Jewellery | 308 | 241 | -22% | -7% | 3% | 2% |
| Corporate | 148 | 145 | -1% | 0% | 2% | 1% |
| E – Commerce | 629 | 394 | -37% | -23% | 7% | 4% |
| Education | 97 | 118 | 22% | 2% | 1% | 1% |
| FMCG_HH | 2483 | 2874 | 16% | 39% | 27% | 28% |
| FMCG_Impulse | 798 | 853 | 7% | 5% | 9% | 8% |
| FMCG_Personal Care | 1340 | 1619 | 21% | 27% | 15% | 16% |
| TOTAL FMCG | 4622 | 5346 | 16% | 72% | 50% | 52% |
| HH Durables | 400 | 402 | 0% | 0% | 4% | 4% |
| Real Estate & Home Improvement | 289 | 274 | -5% | -1% | 3% | 3% |
| Retail | 55 | 72 | 30% | 2% | 1% | 1% |
| Telecom Internet DTH | 1069 | 1198 | 12% | 13% | 12% | 12% |
| Travel & Tourism | 143 | 107 | -26% | -4% | 2% | 1% |
| Others | 348 | 500 | 44% | 15% | 4% | 5% |
| TOTAL | 9186 | 10198 | 11% | 100% | 100% | 100% |
Madison Media expects this trend to continue and if so the year should close just shy of 50,000 Cr. The only change we are calling out at this stage is a reduction in TV growth from 20% to 11%.