NEW DELHI: 2020 started off with industry hopes pinned on a robust double-digit growth. Instead, it left the Indian marketing and advertising industry in shambles. Educated estimates peg the sector to have clocked only a one-two per cent growth over 2019 numbers, with traditional advertising taking the biggest hit, slumping into the negative zone. Industry-wide shutdowns, months of lockdown, and negative consumer sentiments for a little over a quarter contributed to the bloodbath.
However, with the past year growing distant in the rear-view mirror, 2021 marks a fresh start for the industry. Consumer sentiment has continued to pick up post the festive season. And while the pandemic is far from over, the prospect of vaccine roll-out has further buoyed the markets. All this indicates a positive growth trajectory, which will reflect in the marketing industry as well. Industry insiders project that the year might witness growth of eight per cent over 2020 numbers. And just like 2020, this growth will ride on the shoulders of digital, which remains the second largest medium.
Digital to build on its 2020 popularity
dentsu CEO - India Anand Bhadkamkar says, “Just like last year, 2021 is going to be a positive year for the digital industry. Consumers are embracing digital more than before as a way of life. So, there is a lot of scope that e-comm, edu-tech, and online gaming industries are showing. I am expecting it will grow 20 per cent over 2020 numbers. Also, adtech and martech will play a big role in this.”
WATConsult CEO Heeru Dingra corroborates, “The digital ad revenues are forecasted to increase by 15-18 per cent in 2021. Digital spends are noticing an accelerated growth due to result-oriented advertising options, this in turn will further boost the ad revenues.”
DDB Mudra Group CDO and 22feet Tribal Worldwide president Preetham Venkky is even more optimistic and wants it to rub off on the industry as a whole. “In 2021, digital advertising should aspire to have an upwards of 30 per cent growth. We’ve started seeing some RFPs and RFIs with similar expectations. While we are still a few years away from overshadowing TV spends, if the latest spends on OTT were to be used as a benchmark, we’ll see the trend accelerate in 2021 and 2022.”
E-commerce is anticipating a massive year ahead, multiplying its last year’s popularity. It will result in more brands taking on the medium to advertise as well.
Starcom CCO Rajiv Gopinath had mentioned earlier, “Brands are responding by investing more in e-commerce advertising. Marketers are looking to create an optimised combination of media used for advertising in order to maximise ROI.”
AVoD-based OTT platforms are quite excited about more brands turning to them for support. Viacom18 digital ventures COO Gourav Rakshit says, “If we take 2020 as the base, 20-25 per cent growth can be expected from industry.” He adds that consumer product brands have been consistent spender throughout the year while digital-only brands also emerged as a big category.
“Every brand is now going to be a digital advertiser. Within the digital segment also, video is the fastest-growing area. Within time spent on the internet in India, entertainment and video are the biggest thing apart from chatting. So, advertisers have to come here because we can give him reach, targeting, brand recall,” MX Player CEO Karan Bedi adds.
With businesses increasingly deploying CRM solutions to retain and grow their customers, SAAS Platforms like Leadsquared, Zoho, HubSpot will see an exponential increase in adoption and expansion. The industry also sees a great scope in WhatsApp evolving as a primary business medium.
Logicserve Digital founder & CEO Prasad Shejale adds that the industry will also see an even larger focus on an integrated approach to cater to a multitude of consumer needs and expectations to seamlessly deliver what they want.
Another major trend to sustain this growth journey is going to be the creative specialisations that digital has to offer. As GenY Medium co-founder and CEO Yashwant Kumar points out, “Creative specialists now have the opportunity to win on accountability. With help of digital technologies like programmatic advertising, Creative campaigns are able to move numbers on brand awareness/sales and also earn the credits through intelligent measurement and attribution solutions.”
However, the industry might not pick up immediately and might see the first two quarters following last year’s pace.
Filter Coffee founder & CEO Anuja Deora Sanctis notes, “We expect the first half of the year to be slow as companies finalise their budgets for the new year and the economy takes its initial steps towards recovery. The second half of the year will see a higher spend as companies focus on making the most of the festival season by targeting ads for their consumer group. We expect social and e-comm to continue to build on the success seen in 2020 and continue to lead the growth charts this year.”
Dingra highlights that the Indian marketer’s fifth quarter, also known as festive period, will be the highest contributor to ad revenues from both brand and performance marketing, followed by Q1 of CY 2021 which will be predominantly performance driven.
Traditional mediums to evolve, match pace
Television, print, and primarily out-of-home (OOH) advertising saw a massive slump in their ad revenues throughout 2020. While television managed to retain its sheen when it came to ad volumes, it couldn’t monetise the momentum as it would have in normal circumstances. Print and OOH came to a standstill for two quarters, with the latter hitting point zero at the peak of lockdown.
But with the last quarter of CY20, all these mediums came out of the woods and onto the recovery road. If the industry is to be believed, they might very well bear fruits this year.
According to DDB Mudra Group executive director & OMD Mudramax president Sathyamurthy Namakkal, there is a positive sentiment for growth in television advertising as many clients are back in the office and returning to the fold. Ad volumes are likely to grow by 20-25 per cent as compared to last year.
However, he has two prophecies for the ad revenue part. “There are two possible scenarios in television advertising – one will be five per cent lower or close to 2019 volumes. The second possibility (which is very likely) is that the digital and television might also grow by 15–20 per cent because many advertisers want to come back with a vengeance.”
Many clients will continue to resist the sponsorship and be happy with vanilla FCT advertising, he adds.
For print, the road to recovery is going to be the toughest, echo Bhadkamkar and Namakkal.
The former says, “To be honest, the bounce-back meant a faster recovery than anticipated but definitely, the growth to pre-Covid levels is still a long way off. The silver lining is that the print medium historically has continued to show positivity in India even when it was on a constant decline globally.”
Namakkal elaborates, “While the pandemic has impacted every industry, I believe the print media industry has been affected the most. There was a 40 per cent drop in the print adex from April to September 2020. Many publishers did try to incentivise the advertisers for a short period, which did help for habitual print advertising categories like appliances, automobiles, and others. The other positive things are that some of the new age advertisers – e-commerce, edu-tech who had subdued their advertising on print media for the last few months have returned to print as well now. So, if pre-Covid the spend index was 100, it came down to 60 in 2020 and should come back to around 80 in 2021.”
Another trend that he’s seen is that previously brands were doing at least four rounds of advertising (across mass media) that included two-three rounds of product advertising and at least one round of brand equity advertising. But now, it has come down to two product-led advertising rounds and they are focusing on offer-led advertising and very little of brand-led advertising. “Traditionally, print always received a higher share of corporate advertising, therefore this trend will also impact print media,” he notes.
Mathrubhumi MD Shreyams Kumar agrees, “I am hopeful that 2021 will be much better than the last financial year but may not be equivalent to the pre-Covid days. The market is showing some signs of recovery, stock markets are doing better, retail is coming back and GDP growth will be positive, all this is expected to translate into 70-80 per cent of recovery for the print media.”
The OOH growth story, much like print, won’t be able to match the pre-Covid levels. Albeit, it is looking at a positive year, with DOOH taking centre stage with increased bandwidth speeds on the back of the 5G possibility, automated platforms, and tech collaborations.
Posterscope India country head Fabian Trevor Cowan remarks that this optimism is based on the traction witnessed since December, which has carried over to January as well. “The numbers may not breach the pre-Covid benchmark but will certainly be closer than we had initially thought and that in itself is something to cheer about. The DOOH space is a growth area and the increase in inventory that is being witnessed is a good sign. I would be surprised if the growth for this sector is not in double digits in the year ahead.”
He goes on to add that OOH with a purpose will be the underlying premise for all brand communications in 2021, given that a post-pandemic world will seek more meaningful communications from brands.
Laqshya Media Group CEO Atul Shrivastava added, "Traffic on roads is back to 80-90 per cent of normal times, even in metros. In smaller cities, it had picked up immediately after the unlock phases were announced. Most brands have started investing their pent-up budget in OOH media as they can’t shy away from the impact which can be achieved only through OOH media. As per the recent WARC Report, OOH is globally forecast to be the second-fastest growing medium in 2021, with ad spend rising by a fifth (20.2 per cent). We expect this rally to happen in India as well."
He elaborated, "The current quarter will set things into the motion, next quarter Apr—June’21 will be good but the last 2 quarters of FY are traditionally the best and that trend should come back. The advertising industry gets skewed towards the IPL whenever the event is scheduled. It adversely affects all other media and channels, including OOH. The positive side would, however, be the new launches of Automobile models, TV- OTT Shows, expected entry or new launches of Mobile handsets, the revival of Real estate, etc."
(With inputs from Devesh Gupta, Gargi Sarkar)