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#CoronavirusOutbreak: Digital ad revenue to spike momentarily, overall adex to decline

As brands cut their marketing budget with the economy swirling into a recession like situation due to unprecedented countrywide lockdown in order to contain the spread of Coronavirus, India’s adex is likely to be affected proportionally. BestMediaInfo.com talks to industry experts to understand the impact

As India goes into a 21-day lockdown to contain the outbreak of coronavirus, it is expected that there’s likely to be a massive economic cost.

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Experts believe this could force brands to scale down their marketing expenditure significantly. However, it is expected that more focus would be given to performance-based marketing as compared to blanket outdoor and print campaigns.

Saumil Mehta

Saumil Mehta, VP, Solutions, Schbang, believes that with consumers confined to their homes, brands have picked up the signals, and are contemplating revisiting their OOH spends and are shifting their focus to OTT platforms as increased consumption is being seen there.

As reported by Bloomberg, coronavirus could cost the global economy $2.7 trillion. With the worldwide outbreak of Covid-19, marketers are looking at the reallocation of their advertising spend.

Prasad Shejale

Prasad Shejale, Founder and CEO, Logicserve Digital, said the outbreak of this crisis is something very recent and hence it’s hard to understand or track a digital trend. However, he said that although ad revenues will go down in the short term, the percentage of digital spends as overall ad spend will go up.

Samarjeet Reen

“We believe digital/programmatic will be more effective in Metro/ tier 1 messaging, and as we go deeper into India-2, most households still get their content through Cable TV,” said Samarjeet Reen, Chief Strategy Officer of Update Geotarget.

Hareesh Tibrewala

It is very early days in India to spot some trends, but in certain markets like the UK and US, Hareesh Tibrewala, Joint CEO of Mirum India, said that it has been observed that a lot of emphasis on digital content creation is given and thus there is likely to be more digital consumption as well.

Unmisha Bhatt

However, Unmisha Bhatt, Chief Strategy Officer and Director, India and MENA region, Tonic Worldwide, said, “There are very few categories who are advertising in the current times. Most of the brands are acting cautiously with the pandemic affecting business and economy. However, this is an immediate short-term trend and I believe, in the long run, within H2, this will revive and get back to original or faster pace as and when supply chain and production for goods can normalise,” she said.

As there will be a significant cut in the ad budgets, planners will be looking for creative and holistic solutions, across media that cover wide reach, high audience availability and micro-targeting to gain a high ROI.

Experts said that although it is very early days in terms of which categories are spending more on digital, but higher spends are being witnessed on grocery, healthcare, online food delivery, e-commerce, low ticket FMCG goods companies and entertainment and telecommunications.

Rikki Agarwal

Online delivery might be seeing a growth, but Rikki Agarwal, Co-Founder, Blink Digital, said this may be momentary, as the growth is not much.

Is the consumer conversion increasing on digital?

Right now as experts anticipate a substantial increase in content consumption on digital, they foresee it will also eventually result in more online conversions.

Consumer conversion on digital does seem to be increasing with major buying happening online. However, Bhatt said any sort of conversion will finally be impacted by the economy.

Saumil Mehta

As of now with people confined to their homes, there is an increase in demand on ecommerce for essential commodities. With a higher intent to purchase coupled with the fear of limited stocks, digital spends are getting optimised to deliver conversions, said Mehta.

Latish Nair

Latish Nair, Chief Digital Officer, MediaCom, said that with more digital consumption, there is a huge spike in categories like online gaming as well.

Digital is increasingly becoming the preferred media of choice of people to engage and commerce in the moment of quarantining. Will this continue to increase irrespective of the outbreak?

So would this lead to change consumer behaviour as well in the long run?

As people are working from home now, so it is logical that people would rather view content in their free time on large format screens, said experts.

Tibrewala said that in the short term, there is a lot of anxiety factor on account of this non-stop bombardment of corona-related information on phones and TV sets. However, in the long run, he doesn’t see any significant shift in human behaviour in consumption.

Digital time spent is definitely going up. This is going to push everyone to get into the habit of shopping online. E-commerce will possibly grow as well and when things get better, Bhatt believes the habit will continue.

Although experts globally are still figuring or tracking detailed consumer behaviour, but Covid-19 has definitely changed consumer habits and majorly affected the supply chains around the globe.

“Consumer behaviours will change, and consumers will trust and interact digitally more. It means that online sales cycles will reduce, and consumers will like to have easy interactions on the brands digital assets,” said Shejale.

Gopa Kumar

Gopa Kumar, Chief Operating Officer, Isobar, said as more and more people are on digital platforms and engaging with them, in the short term as well as a long run there will be a change in consumer behaviour because of this forced change, people will get comfortable and used to in availing digital services from home.

“Doing e-comm transactions, availing grocery, medical services, banking transactions, perceived dependency on going out for these kinds of services will be busted and people will get to be familiar and use these services more and more. People will become much more familiar in dealing with virtual in the long run. Brands who are willing to be active in this situation can emerge from this situation and also of this behaviour change with stronger brands and a more engaged, trusting consumers when things eventually become normal, brand growth can be back to sustained level,” he added.


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