Tamil Nadu ad market can't revive until movie releases happen

Tamil Nadu ad market can't revive until movie releases happen

TV witnessed a slump of 35-40 per cent in ad revenues in Covid-period


NEW DELHI: Holding the highest share of regional ad volumes at 16 per cent in Covid times, as highlighted in the TAM AdEx data released recently, the Tamil Nadu ad market wasn’t immune to the bloodbath on ad revenues that the overall industry witnessed due to the lockdown. 

As shared by The Media Ant co-founder Samir Choudhary, the market witnessed at least a 50 percent drop in overall revenues in the March-June ‘20 period.  

Fourth Dimension Media Solutions CEO Shankar B elaborates, “In Tamil Nadu, almost 30-35 per cent of the ad revenues are driven by cinema and retail, both of which were zero during the Covid2019-period. Even if we talk just about cinema, Tamil Nadu is amongst the top movie-producing states in the country, giving a tough competition to Bollywood. We release around 15 films a month and each banner spends approximately Rs 3-3.5 crore for seven days’ promotional slots, which most other categories would spend in a month. With that being nil, you can imagine the impact the market has witnessed.” 

For television alone, like most other markets, the viewership and ad volumes both were up during the Covid2019 period. As highlighted by the tenth edition of BARC+Nielsen weekly reports, Tamil channels were recording 15 per cent hike in viewership as compared to pre-Covid2019 periods in week 26, starting 27 June. News consumption was at 177 per cent high. 

While the ad volumes dipped by 41 per cent overall during the past three months, the trend started moving upwards month-on-month as the situation improved, TAM AdEx data reveals. During Covid2019, ad volumes across all Tamil language genre surged by 29 per cent in June 2020 over April 2020 and by 27 per cent in May 2020 over April 2020.

However, this did not result in revenues as channels were functioning at drastically lower operating rates, which were dropped by 50-60 per cent to keep the advertiser sentiment positive, shares Choudhary. 

Shankar B notes that while some of his clients took the conscious call to not cut ad rates, certain channels took the decision to announce rampant discounts. Some were even functioning at 1:2 bonus, which means offering two slots at the rate of one to keep the inventories filled. “Despite the ad volumes being high on certain channels, they recorded 35-40 per cent drop in ad revenues.” 

However, the situation gradually started improving. Choudhary feels that the market will see its revival around Diwali, with advertiser sentiment improving. But Shankar B feels that it is impossible to pin a date on industry revival. “Things are getting better but the channels are still running at discount prices. We can’t say when will the revenues be like pre-Covid2019 times. But one thing is sure, Tamil Nadu market won’t be able to get back on its feet until cinema and retail sectors start functioning like earlier as they account for almost one-third of the revenues there.”