After muted festive adex, industry pins hope on the remaining quarter

New Delhi: This year’s festive season from Navratri to Diwali was a little muted or below normal and the debate has swiftly moved on to the expectations from the remaining part of the quarter. 

Talking about the festive ad spends, two top media agency heads confirmed with BestMediaInfo.com that it was below normal.

“Usually, there is a lot of demand for inventory during festivities backed by a lot of campaigns. We had a few campaigns running this year but not at the expected scale,” said one of the global agency heads.

When asked about the reasons, the agency head cited various reasons for different clients. “Some clients were in transition. The campaigns got shifted as launches got moved.”

Navratri and Diwali falling early and that too in the same month made things a little trickier for the overall market sentiment. 

“Because Diwali was on the last day of the month, some impact will also be seen when the November data comes out. It would be better to look at combined numbers for Oct-Nov,” said the India CEO of a global media agency.

While there was an impressive number of car sales, especially in the middle and upper price segments, four new cars were announced for launch on the first Monday after Diwali, i.e. November 4. 

“The advertising spends will pick up. It is better to look at the quarter numbers,” the India CEO added.

According to this agency head, “The deepening crisis in the Middle East, along with the danger of expansion of the ongoing Israel-Hamas war, had a cascading effect on the global market. Global clients became a little wary of investment. Monsoon was good but extended and that impacted the overall performance of businesses relying on seasons such as beverages, air conditions and coolers.”

“The govt spending in election years goes down drastically and that has dampened the overall mood. The govt spending is down by 50-70% and that’s a sizeable chunk,” the agency head added. “Then there is unpredictability due to US elections. Look at what is happening to the stock markets.”

Explaining the category-wise buying trend, the agency head quoted above said, “People are not overbuying regular consumer goods. Neither, they are buying into new premium categories. But things like travel and other experiences are growing.”

When asked if the theory of correction into the post-COVID revenge consumption over 2-3 years is true, both agency heads nodded in agreement.

On category-wise advertising spends, the agency head said, “FMCG in general was muted. The automobile also was a little muted. On the other hand, retail, jewellery and real estate were the saviour.” 

Among the traditional mediums, print had a good run during the festive build-up, but it dipped very quickly. “Still, it outperformed any other traditional medium,” said the agency head.

Digital ad spends has stayed with Google, YouTube and Meta and both the agency heads did not see any shift in that.

When asked about the impact of e-commerce or social media platforms on traditional media, one of the agency heads said that these mediums are impacting sales in hardcore metros but that’s very fragmented. “For example, there are 30,000 brands selling candles on Instagram.” 

“It’s only top-tier people spending but with a twist. They are spending on investment and experiences but not on consumer bills,” added the agency heads.

The muted demand also impacted the ad rates this festive season. Owing to the lower demands, brands were able to negotiate and secure significant discounts from platforms. 

“For the regular period, the rate would be 20% less than the average rate for the whole year. The same would be 20% more during the festive season. Brands would pay a premium to ensure that they would get inventory. This year, that did not happen. This time it was a reverse case,” said the India CEO of the global media agency quoted above.

Both the agency heads told BestMediaInfo.com that overall projected ad spends showing 7-10% growth are still achievable.