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News channels expect 30% jump in revenue in upcoming election season

Channels have already started lining special coverage around the 2019 general elections. Expecting a major viewership spike, broadcasters have started revising ad rates. The ad volume will also see a major increase due to political advertising

Ending the long period of muted growth, the upcoming general elections are likely to boost the revenues of news channels across languages by at least 30%.

Along with lining up special programming and sending reporters for ground coverage, the channels have started revising their ad rates.

Industry estimates say ad spot rates are being increased by 30-50%. Channels are also getting standalone sponsors for election specials.

It is not only political advertising alone that pushes the ad revenues or ad rates up; corporate advertising too increases and is sold at a more premium rate.

“There is an upward trend in the news consumption pattern, and the viewers are engaged in tracking the rise and fall of political party ratings. Hence, there is an increment in ad revenues as well. There is a substantial increment in the Aaj Tak FCT for all its existing and potential advertisers,” said Rahul Shaw, Chief Revenue Officer, India Today Group.

While the peak election days are not too many — exit polls, pre-post, polling days and counting days — the gain is experienced over a 6-7 month period in the run-up to the elections.

“The Lok Sabha elections are the World Cup of the news genre. It is not a standalone event anymore but a sentiment that starts minimum 6-7 months before the election month, when people start analysing politics more deeply, the markets start swinging like one cannot imagine and a whole new industry emerges out of it. The beauty is that the 2019 general elections are also surrounded by state elections and the countdown has begun,” said Joy Chakraborty, President, Revenue, Network18 and CEO, Forbes.

Talking about the advertising categories that are more active during elections, Shaw said, “The TV genre is an effective media mix, across industries and categories. Elections are very serious business that impacts the life of one and all and with high-decibel campaigns on air; advertisers from all categories want to connect with the viewers.”

“The elections will attract increased ad spend by corporates as the political scenario has a direct impact on the overall political and economic scenario in the country. We expect an underlying opportunity with increased spend heavily during elections on news genre by FMCG, food and beverages, auto, BFSI and services sector,” said Avinash Pandey, COO, ABP News Network.

On the peak days like counting day, Chakraborty said, “The rate for 10 seconds can go as high as Rs 1.5-2 lakh on a Hindi news channel, which can be over a 20 times increase for some channels.”

On a normal day, a news channel will sell as many as 20,000 seconds; on counting days and exit poll days, the channels can sell only 5000-7000 seconds per day.

One of the media agency heads, who did not want to be quoted, said that news channels may gain around Rs 200 crore just from political advertising.

“Political parties also include GECs in their media plans along with news. Last year, GECs got about Rs 75-100 crore, news channels got Rs 15-20 crore, on the back of UP elections. The potential of news channels alone is about Rs 150-200 crore from the political parties. 30% of the total ad revenues would be coming from political parties, in about two monthto the elections,” the media agency head said.

Explaining what makes these elections more lucrative from viewership point of view, Shaw added, “In the year gone by, the focus was on GST and demonetisation and its huge impact on the lives of the common man. So I can safely say that the viewers are clued in to the political scene and are just as tuned in and looking forward to new and positive changes, like during every election season.”

Regional news channels are also poised to gain significantly higher revenues. A lot of national parties look at making alliances with regional parties, which decides who comes to power centrally. So experts estimate the parties might look at strengthening their positions in the regional arena by spending heavily on regional news.

Sprucing up the content

The channels are making significant investments in election programming.

Explaining the importance of the elections and the content plans of ABP network, Pandey said, “The elections are a very big draw for all the electronic channels and ABP News Network is gearing up to brace the hoopla. We started the programme ‘Kaun Banega Pradhanmantri’, the success of which became a benchmarked gold standard and later got replicated by many other channels. For the 2019 elections, ABP News Network will be extensively making opinion poll analysis and extensively cover the election on its digital mediums in multiple Indian languages, bringing the most unbiased, unaltered information on the election, capturing an all-encompassing journey of the entire election drama in the country. ABP’s core strength lies in the regional presence that would be extensively covered for an actual on-ground prognosis of the polls and the various facets around it.”

In preparation, India Today TV on September 7launched Political Stock Exchange, a special show hosted by Rajdeep Sardesai and Rahul Kanwal. Political Stock Exchange has also been launched on Aaj Tak, hosted by Anjana Om Kashyap.

Multiple shows will soon be launched on Aaj Tak for all-round election coverage.

Talking of the plans of India Today group, Shaw said, “Since its inception, Aaj Tak has been covering elections closely and we were the first ever channel to carry out a 72 hours of non-stop coverage on elections. Several innovations are lined up across the group.”

Network18 too has a lot of special programming such as their popular properties Sabse Bada Dangal, road shows, campaigns and other on-ground events through which they are looking at focusing on both FCT and non-FCT sponsorships and branded content.

Giving a more elaborate view on the industry and Network18 channels, Chakraborty explained, “News becomes an important part of each and every media plan in the run-up to LS elections. This is the time when we see the prime advertisers vying to bag presenting/ co-presenting titles, which will have a positive impact on both — revenue and yield. All news channels improve the ad rates, especially for us.Our brand News18 India has grown immensely in the last couple of years and we are No. 1 or 2 in primetime every week. This has helped us in improving the ad rates drastically. Similarly, CNN News18 is also doing very well. We also see an area of opportunity, to monetise election programming on the business news channels at the back of our general news channels.”

How will technology help in more innovation and engagement of content during elections? Shaw answered, “News is the bedrock for content consumption. Technology has dramatically changed the consumer news consumption pattern. Today there is a paradigm shift in how news gets consumed across genres. We have launched 17 digital channels so far. 11 channels in the news category cover an entire spectrum of national, international and regional news. Our multi-platform digital channels will power our coverage, including Hindi News (News Tak, UP Tak, MP Tak, Duniya Tak, Mumbai Tak, Punjab Tak, Crime Tak, Bharat Tak, Sports Tak, Dilli Tak) and English News (News MO).”

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