Reena Joshi wants to desperately find out the twists and turns in her favourite show Balika Vadhu. But all she is getting these days is a re-run of the show, thanks to the strike that was called by the Federation of Western India Cine Employees (FWICE) over the wages of workers had brought the shooting of TV programmes to a standstill. With the entire world coming to terms with a global economic crisis, turbulence has hit the television industry as well. Due to the economic recession, TV channels are undergoing a major revenue crunch with escalated broadcasting costs. To add to the dilemma of advertisers and broadcasters, the strike forced channels to air re-runs of shows. TV viewership suffered a blow and though the strike was called off on Wednesday evening, fresh episodes are likely to go on air only from Monday. Advertisers are feeling the pinch too and are now considering rethinking their budgets and going for a medium, which is less costly and has significant reach.
Drop in ratings
According to television audience measurement agency, Audience Measurement and Analytics (aMap), there has been a considerable drop in GEC ratings due to the re-runs of television shows. All major general entertainment channels (GECs) suffered an average drop in prime time GRPs (the sum total of TRPs for a channel) by 35-55% within the last three days since November 10 compared to the prior week. Ashit Kukian, executive Vice President and National Head ? sales, Radio City feels, ?Ideally such a situation should lead to higher listenership for radio stations. But it is a short a period to determine the fate of radio listenership. Recession has led advertisers to become cautious about their spending by concentrating only on the important markets. But the strikes were merely incidental and would have been considered serious if the matter was unresolved for more than three to four months.?
Discounted ad spots
A 10-second ad spot on television costs anything between Rs 15,000 and Rs 2 lakh. This amount is far more than radio, where a similar ad spot may cost between Rs 4, 000 and Rs 10, 000. And the price is dipped further for an online platform like the internet. However, the nationwide reach of television is considered to be more than that of radio or any other platform.
A media analyst explains ?The strike came in at a moment when the television industry is not making much money. Amidst a financial crisis, it is only natural for advertisers to tighten their purse strings and opt for less expensive media like radio, mobile or an online platform.?
Tarun Katiyal, Chief Operating Officer, BIG FM says, ?Last month has been our highest in terms of revenue. We do however recognise the changes in the economic environment and the radio industry will need to take appropriate steps. Greater cost consciousness, higher quality product delivery to engage and deliver even larger number of audiences to clients, providing client with more exciting solutions for their brands and therefore deliver greater value to clients is required now even more than ever.?
For Abraham Thomas, Chief Ope-rating Officer, Red FM, the recession has impacted the entertainment industry but it is too early to say whether the re-runs have compelled advertisers to move to platforms other than television. ?TV has the largest category of advertisers. Both the recession and the strike may have made the advertiser more cautious about his spending budget as of now. For instance, certain categories of advertisers like GECs may refrain from advertising on TV and thus are more likely to spend on radio advertising,? feels Thomas.
Advertisers hit
The two categories of advertisers that have been immensely affected by recession are finance and retail. Major advertisers in the FMCG categories like Procter & Gamble (P&G) and Hindustan Unilever (HUL) have not been as badly affected. Saurabh Vartikar, Head, mobile marketing, Mauj Mobile says, ?Since July, we have seen an increase in enquiries on mobile marketing. These enquiries are from sectors such as banking, consumer goods and retail. While actual translation to business is also driven by factors like planning, we have seen that concepts are being taken up quickly and mobile factors in both tactically as well as a singular media.? However, media planners point out that the TV strike may not be the reason for this shift, as media planning for any channel is not done on a weekly basis but over a much longer period. This year TV has surely felt the pinch. There has been a definite cut in budgets. But currently there is no shift advertising monies due to the strikes as both AAAI (Advertising Agencies Association of India) and ISA (Indian Society of Advertisers) were supporting the GECs. However the recession may cause advertisers to consider a change in their media plan.
As far as online advertising is concerned, it is in the range of Rs 400 to Rs 550 crores and is growing steadily. Marketing spends even in this medium is circumspect but not being slashed completely. Advertisers like Bharti Airtel and Tata Sky have been uniformly spreading budgets across media. Rishi Khiani, COO, Web18 says, ?We have experienced a steady growth of 60% over last year. It is too soon to comment on recession leading to switches from one medium to another or about the growth percentages of industry.?
Whether the economic meltdown or the TV strike, industry experts feel that this is a bad phase for the industry. Navin Mittal, business head, Fropper.com mentions, ?More media outlets result in further fragmentation of budgets. Thus the current global financial scenario will lead to a reduction in budgets on conventional advertising mediums. The strike by the FWICE during this recession time may have resulted in advertisers looking at alternative mediums that effectively deliver.?