The ongoing slowdown has certainly impacted sentiments across various media platforms right from print to television to outdoor, as marketers tighten their purse-strings. But the sluggishness has permeated down to OOH in a much deeper manner. Owing to lack of proper accountability and measurability, outdoor has been among the worst hit media with the industry facing severe cuts in spends from key sectors like real estate, banking and financial services and Mumbaiâ€”the biggest outdoor marketâ€”has been the most affected, according to the industry and analysts.
Looking at the projections of the Pitch-Madison Ad Outlook, 2009 will see a drastic 20 percent negative growth in advertising spend on the outdoor media. The share of the outdoor media will shrink to 5.4 percent in 2009 from the present 6.8 percent in the overall advertising pie. As a result, the industry is expected to see a decline in revenues from 2008 figures of Rs 1,419 crore to Rs 1,135 crore in 2009.
But, there’s a silver lining too, the lull growth period that the industry is facing for the last three-four months, is expected to pick up from mid-2009, say leading industry stakeholders.
JCDecaux India managing director Pramod Bhandula says the industry is on track, and the recent cuts in spends is more because of sentiments than market conditions. “I feel that growth will remain around five percent or no growth during the first half of 2009 and then it will be back to its pace as it was during the same period in 2008,” informs Bhandula.
Consolidation on Cards
Interestingly, some experts suggest that the slowdown will bring in a phase of consolidation in the industry which will separate the men from the boys. “The slowdown shall bring forth the stronger and serious players in the business and will have a cleansing effect to the entire industry or a consolidation in the business,” reveals Serve & Volley senior general manager Virender Raina.
Big Street country head Rabe Iyer says research in the medium will lead to accountability. Local and small national players may get marginalised, if they don’t innovate and build specialist expertise. More regulation will lead to more tenders and transparency. And innovations will be closer to the point of purchase and corporate manpower will bring structured and objective decision making,â€ argues Iyer.
Tag Media vice-president Mahesh Krishnan says, “2009 will set the men apart from the boys!” Navia Starcom India and Asia chief executive Sanjay Shah opines,Â “there is bound to be consolidation in the times to come. Synergies and technology are going to play a major role in the near future.”
In short, most of the players that we spoke to are bullish about their 2009 plans and growth prospects. Some players are even ready with their expansion plans for 2009.
Trends & Plans 2009
Serve & Volleyâ€™s Raina says 2009 shall be a landmark year for the industry which shall not only see growth on a faster pace but would also see a major shift in terms of the total advertising pie. â€œConsolidation is on the cards.Â Good year for most of us in the industry,â€ says Raina. Enhance Media country head Kaushik Chakravorty agrees saying, “weâ€™ll consolidate on our service and product offerings and also enhance our capabilities to provide better products and optimal costs within defined timelines. This will mean a bigger team for our increasing business relationships with our existing and new clients. Also weâ€™re in active discussions with various like minded players for creating what I call the i2i networkâ€”ideation to implementation,” he elaborates.
However, Ghraphisads managing director Mukesh Gupta is keeping his fingers crossed and expects the market to get back in shape. â€œIt will take some time but we are hopeful that after the general elections in April-May, if a stable government is back, growth would be back on track,” opines Gupta.
Jagran Engage general manager for brand development M Kumar says 2009 will see robust growth as a lot of projects that are currently underway will be operational. New projects especially in transit/ambient space will also be new options to look at. Weâ€™ll aggressively follow a â€˜specialist agencyâ€™ approach and pitch for business. Jagran Engage also plans to invest in new opportunity especially in tier two and three locations.
Big Streetâ€™s Iyer informs that his company is still enjoying the new entrant status and so is buoyant about 2009. â€œLike all beginners, we hold the unique advantage of understanding the trends and their implications and apply them to scale our business. Weâ€™ll continue to focus on driving solutions through its 3i model (insight, innovation and impact) for creating customer and consumer delight alike,” says Iyer.Â He adds, with better technologies and smarter inventory, the role of relevance and contexts will increase in the industry.
Experts also suggest that 2009 can be a critical year for the digital/retail media which remains unexploited due to low creative feedstock. They also note that ‘metrics’ will become increasingly important and players who have invested in analytics will benefit.
Enhance Mediaâ€™s Chakravorty sums it up well: “three things will stand outâ€”more scientifically developed, aesthetically designed, technology-enabled properties will be introduced in various formats. Consolidation of a fragmented media ownership is already underway and rules and regulations, formats etc are getting standardised by authorities. Lastly, tools, processes, and measurement matrics will become critical.”
However, going by the nature of the OOH media, only a faster recovery will see advertisers going back to this space for brand campaigns.