World Cup ad spends up 30%; 'dormant' categories return this festive season: Ashwin Padmanabhan

With more brands advertising during the festive season and increased marketing investment in the World Cup, the adex infused in Q3 is definitely much better than last year, said Ashwin Padmanabhan, President - Investments, Trading, and Partnerships, GroupM.

“The spread of brands this festive season is wider than last year, which means more money is being invested this festive season. The categories that have become dormant are returning to advertising. We are seeing an expansion of the categories of brands that are advertising on marquee properties, like the Cricket World Cup. Overall, I would say it's surely going to be better than last year.”

He added, “Last year, the festive period wasn’t very good due to the rise in interest rates. We saw a dramatic cut in spending from July onwards, which led to a very subdued kind of festival. It was also a very short festival."

Adex in World Cup 2023 25–30% higher than last year

The GroupM Trading and Investment Chief told BestMediaInfo.com that the investments this World Cup are close to 25 to 30% higher in comparison to last year.

He continued, "While ad spending was curtailed during last year’s T20 World Cup, this year there is a significant interest and investment made by advertisers in the cricket property. And it's a long tournament, so we'll get to know more as the tournament proceeds."

Brands from Tier 2 and 3 showing more interest in cricket

Usually, cricket has been the playground of either well-funded start-ups or established large brands. But Padmanabhan pointed out that this time around, a lot of the tier 2 and tier 3 brands have started spending on big properties like cricket. 

He further said, “We saw this happen a bit in IPL, especially on digital, where a lot of small brands took on to cricket. We have seen the same thing continue even in the World Cup. There are so many regional and SME brands which are advertising on cricket.”

Categories of brands advertising have increased

Padmanabhan said that this year, traditional brands (auto and consumer durables), big or small, are getting active.

“Navratri has just begun. As we are getting into core festive with Dusshera coming up, we are seeing a lot more categories getting active, added Padmanabhan.

He further said that ad spending by e-commerce players has increased. “We are also seeing that the e-commerce players Amazon and Flipkart have also made a comeback in terms of advertising. The ad spending by e-commerce players was very subdued last year. And most of this year, they have been very subdued. Even clients who had almost taken a sabbatical from advertising are coming back.”

Startup story this festive season

A lot of the start-ups, which are stable now and have been able to get their finances in order, have started spending again to drive sales.

“For instance, the Livspace-like category of brands that completely went off advertising over the past 12 months has started coming back,” said Padmanabhan.

He also told BestMediaInfo.com that even in the fintech space, we are seeing payment apps increasing their adex, but this time the advertising from their end is more about new services and not just UPI.”

“They're also launching a lot of new products. The story earlier about payment apps was about UPI. Now, almost every app has other value-added services that they're trying to upsell. For example, PhonePe is talking about insurance and not UPI."

With new product launches, advertising has also grown. But Padmanabhan emphasised that brands have become more mindful of spending sustainably, driven by the solid fundamentals of business, versus spending purely fueled by a lot of funding in startups’ hands.

He commented, “Ad spending by startups is more pragmatic and sustainable. It may not be to the level of 2021 or even 2019, but surely more sustainable.”

The importance is advertising prevails

Padmanabhan said that there is more and more recognition of the fact that one needs to connect with and talk to consumers to drive volumes of sales and interest.

“You don't need to go overboard, but you surely need to continue to advertise to be able to build your business. I'm hoping that this festival is that point of inflexion where brands and companies who were in a way conserving cash and getting their finances in order are looking to now enter a phase of growth where they start investing in advertising again and start driving more consumption,” he commented.

Brands are advertising sustainably

While 2020 was all about COVID-19, 2021 was a rebound from Covid and we saw brands going all out in terms of marketing.

Padmanabhan commented, “That year, a lot of categories like FinTech, EdTech, and gaming were big spenders. Those are categories that have either vanished today or, in some cases, like gaming, have become very subdued."

He went on to say that this year, we are seeing traditional categories like auto, consumer durables, retail, commerce, BFSI, and FMCG advertising judiciously.

“Although FMCG usually doesn't go overboard during festivals, one can see them spending moderately,” he added.

Info@BestMediaInfo.com