My last week’s column, where I had written about the Upfront market, got rave reviews from many of my friends and colleagues in the media fraternity. The topic touched a chord with everyone and the common consent was that yes, we need something like this for the Indian media market to make things more streamlined and transparent.
Reading the final draft of the piece, however, I thought that while we are talking about streamlining the buying and selling process, is the level at which our media is being sold justified?
I am choosing to keep my focus on the television media here, as print has been there since ages and enjoys the biggest ad chunk, and while digital is a phenomenon, is still picking up. I wonder if television, with the way it has grown, has given choices to its viewers, has become like a member of family for many, is getting its due returns or not. It is funny but when the prices of tomatoes go high, your vegetable vendor tells you that because the petrol prices have increased, because the transportation costs have risen, the prices have gone up. You never complain and pay the price. I am not sure if it is the same with our media owners as well. While the costs of production, manpower, technology, everything has risen, the media owners have hardly been able to cast it as a reason of increasing the ad rates. Over the years, though the medium has surpassed every other in grabbing consumer mindshare, the returns for the medium have been abysmally low.
If I try and look at the reason for this, I’m pretty confused. According to the latest KPMG- FICCI report, ad spends in India increased by 16.6 per cent in 2010 and touched 26,600 crores. The viewer base has increased from 90 million in 2009 to 116 million. More and more international companies are opening shops and introducing their brands in Indian markets, that too in mass segments. So when the advertising space is so bright, why is it that the ad rates are still where they always used to be?
Most of the media buyers say that the viewers today are fragmented. But I fail to understand – if a property like IPL can charge exorbitant sum of money, showcasing itself through the same medium, why can’t others? IPL has upped its advertising rates to about Rs 6.5 lakh this year and is set to earn about Rs 1000 crores from ad revenues from only this season. An article in the Sunday Standard says that most of the inventory of IPL was sold out much before the season, leaving just 10 per cent for the finals and semi-finals which are obviously going to be sold at much higher prices. So how does the shift happen when the medium is the same, the viewers are the same, the times are the same, and the only thing that changes is the offering? I sometimes wonder if the price of a Dabangg on television vis a vis IPL would be equal, though I am sure both of them would attract the same amount of attention from audiences.
Even if we buy the reason of audience fragmentation, when we are talking of the brand’s message reaching about 116 million households, isn’t paying a price of just 1.2 paisa per viewer too low? I don’t know if I could even call it dirt cheap....
I think the biggest hurdle here is to change the mindsets of media owners. They need to believe in their product and, despite the cut-throat competition, understand that their offerings are reaching out to people and in a better form than any other medium. It is a premium platform and reaches those that matter most to these brands! So when the efforts are hitting the nail, why isn’t the one who is felicitating the process benefiting from the exchange?
Star has taken a step ahead and begun the change. The industry has so far been positive as they value the brand and believe in it. I think it’s time for others to take a lesson and apply the right value to the right efforts.