MAM
Global cost of TV advertising up by 5%: Zenith
MUMBAI: The overall global advertising expenditure is set to grow 11.2 per cent in 2021, according to Zenith’s latest mid-year Advertising Expenditure Forecasts report, released on Monday. This rise will mainly be driven by the exceptional demand for performance-led ecommerce advertising on online video, says the report.
In fact, the cost of television advertising is up 5 per cent this year on average, well ahead of its one per cent adspend growth rate, led by rapid recovery in ad spend and continued migration of audiences from traditional to digital channels which is fuelling substantial increases in media prices, particularly for television. The volume of audiences reached worldwide via television is, however, shrinking.
Digital, on the other hand, is growing mainly due to rising audiences and more extensive monetisation, with online video inflation averaging seven per cent, and social media roughly flat, compared to their 26 per cent and 25 per cent respective ad-spend growth rates. Advertising expenditure will total $669 billion this year, $40 billion more than was spent before the pandemic in 2019, as per the report.
Growth in ad spends is expected to remain robust in the medium term, with 6.9 per cent growth forecast for 2022 and 5.6 per cent for 2023.
Social media and online video have eclipsed traditional static display, which is forecast to shrink by 15 per cent this year. Overall, Zenith expects digital advertising to grow by 19 per cent in 2021, and increase its share of total adspend to 58 per cent, up from 48 per cent in 2019 and 54 per cent in 2020.
Most other media are enjoying growth this year, as spending rebounds from the 16 per cent drop in traditional media adspend in 2020. Cinema and out-of-home were the worst affected by COVID-related restrictions, shrinking by 72 per cent and 28 per cent respectively, and will enjoy the fastest recovery in 2021, with respective growth rates of 116 per cent and 16 per cent.
Radio advertising, which shrank by 22 per cent in 2020, is forecast to grow by four per cent in 2021, while television fell eight per cent in 2020 and is forecast to grow one per cent in 2021. Print will continue its long decline, now in its fourteenth consecutive year, with an eight per cent drop in adspend in 2021. In 2023 adspend in all these media will still be below 2019 levels, though cinema and out-of-home will have made up almost all of their lost ground.
Audiences continue to migrate online, and online video viewing is growing rapidly, even as traditional television ratings shrink again after a one-off spike when lockdowns began in 2020. Advertisers value online video as a means of maintaining reach while television declines, but it’s an effective form of brand communication in its own right. Demand is strong, although the popularity of subscription-funded video-on-demand has helped limit the supply of high-quality online video available to advertisers. Zenith predicts that online video advertising will be the fastest-growing digital channel in 2021, rising by 26 per cent to reach $63 billion.
The coronavirus pandemic has accelerated the structural shift in the economy from bricks-and-mortar sales to ecommerce, driving more consumers than ever to research and complete purchases online. Brands have responded by forming partnerships with retailers and creating new direct-to-consumer operations, using performance-driven advertising – primarily in social media and paid search – to lead consumers down the path to purchase. Zenith forecasts that social media advertising will expand by 25 per cent this year to reach $137 billion, overtaking paid search in scale for the first time. Paid search will expand by 19 per cent to reach $135 billion.
Much of this is new money to the ad market, coming from small businesses that have had to pivot rapidly to ecommerce to survive lockdowns, and from budgets that brands would previously have allocated to retailers to secure physical shelf-space, which they are now spending on display and search ads on retailer websites. The shift to ecommerce will slow down as coronavirus restrictions lift and economies open up again, but won’t go into reverse. Zenith expects ecommerce to continue to pull in incremental revenues to the ad market, driving 13 per cent growth in social media and 12 per cent growth in search in 2022.
“The online video landscape continues to transform, fuelled by the growth of streaming services and connected TVs,” said Zenith global chief digital officer Benoit Cacheux. “Its continued evolution requires a radical rethink of how to build the optimal screen-neutral reach model. The ingestion of new data sources into TV planning also creates further opportunities to further sync TV and video planning.”
All regions will enjoy robust ad spend growth in 2021, with Asia Pacific showing a nine per cent growth.
The US will be by far the largest contributor to global growth in 2021, accounting for 46 per cent of the $67 billion added to the global ad market this year, followed by China with 11 per cent, and Japan and the UK with six per cent each.
“After a very tough year last year, the ad market is enjoying rapid and broad-based recovery, and will end this year well above the level it achieved in 2019,” said Zenith head of forecasting Jonathan Barnard. “Digital advertising is becoming a more effective tool for brand growth as media and commerce continue to move online, attracting greater investment from large brands and small businesses alike.”
Brands
OpenAI hires Nitin Bawankule as head of enterprise sales, India
Former AWS, Google and Disney+ Hotstar leader to drive AI adoption at scale
MUMBAI: OpenAI has appointed Nitin Bawankule as head of enterprise sales for India, strengthening its leadership bench as it deepens its push into one of the world’s fastest-growing AI markets.
Bawankule, who will join in mid-May, brings more than two decades of experience across cloud, media, and digital ecosystems. Most recently, he served at Amazon Web Services, where he led multiple high-growth verticals and helped accelerate enterprise adoption of cloud and AI solutions in India.
Announcing the move, OpenAI head of enterprise sales, India Nitin Bawankule said he is looking forward to helping organisations transition from “isolated AI pilots to company-wide transformation” and embedding AI into everyday workflows to unlock productivity and better decision-making.
Before AWS, Bawankule held senior leadership roles at The Walt Disney Company, where he led ad sales for Disney+ Hotstar and television networks, driving revenue growth across major sporting and entertainment properties. He also spent over eight years at Google, including a stint as country director for Google Cloud in India.
His appointment comes at a time when Indian enterprises are rapidly scaling AI adoption, moving beyond experimentation to integrating AI into core business functions. OpenAI’s decision to bring in a seasoned enterprise leader signals its intent to capture this opportunity and build deeper partnerships across industries.
With a strong track record in navigating major technology shifts, Bawankule is expected to play a key role in translating AI’s promise into practical, business-ready solutions for Indian companies.
As the race to operationalise AI gathers pace, OpenAI’s latest hire suggests it is gearing up not just to participate, but to lead from the front in India’s enterprise AI story.
