Is traditional media missing the festive spark?

The advertising landscape this festive quarter, which is typically a bustling period for the Indian media and advertising industry, has remained muted so far because most sectors have adopted a cautious approach amid rising inflation, softening of demand and economic uncertainty.

Traditionally, brands capitalise on the festive season by floating eye-catching campaigns in newspapers, television channels and outdoors offering exclusive discounts, and partnering with high-profile events to catch maximum eyeballs. However, this enthusiasm is missing in the festive season especially from the top advertisers in categories like FMCG, Automotive, Real Estate, BFSI, Jewellery, and Home Appliances, as per current ads and bookings.

This slump has largely impacted the traditional media - print, outdoor and television. TV is believed to be impacted the most, industry leaders told e4m. TV inventories have not been fully sold, prompting channels to slash ad rates, media planners and TV executives shared.

“This time, advertisers are allocating more budget to digital media than to TV this season in hopes of achieving better conversions. While there is uncertainty about how much of this spend will translate into sales, there is confidence that it will effectively reach the targeted audience and drive top-of-the-funnel engagement," says Sujata Dwibedy, Chief Investment and Trading Officer, Amplifi, Supply side management team of dentsu.

The ongoing decline in TV viewership and the inability to target consumers as effectively as digital platforms are impacting ad revenue, the media head of a leading FMCG brand shared. “TV channels still rely on the outdated NCCS classification of households, which has become obsolete. As a result, we are cautious about our TV advertising spend.”

Print media is already experiencing a subdued festive season , as e4m reported earlier. With Diwali just a week away, the situation hasn’t improved much. Padmshri Hormusji N. Cama, Chairman and Managing Director of Mumbai Samachar, noted, “This festive season isn't great, but it's not terrible either.”

TV executives shared similar sentiments, stating, 'The full extent of the festive slowdown will be clearer once the season concludes and third-quarter results are in. However, we remain hopeful that Diwali will boost our morale to some extent.'"

Why the slump

Notably, brands have always relied on TV - entertainment and news – both for brand building through mass campaigns. However, consumers have largely put their discretionary spends on hold due to high inflation. Several other factors also dampened the mood of consumers in many parts of the country.

Veteran adman and MD of Rediffusion, Dr Sandeep Goyal, says, “The Pujo season in Kolkata got massively diluted because of the overhang of the RG Kar episode. Many brands get as much as 8-10% annual sales from the East during the festive season. So that’s been a big blow.”

“FMCG has been lukewarm. Q2 has been subdued for at least some players.

Automotive sector has been slow for a long time. Not much perk up expected in the next two weeks,” he shared.

Dr Goyal adds that travel, tourism and hospitality are buoyant. Hotels and air tickets are at an all-time high. More importantly, everything is sold out. So at least one sector that is in a celebratory mood. Fashion, driven by e-commerce, seems to be in good shape.

Digital push

Most brands usually spend 35-45 per cent of their annual ad spends during festivals which starts from Onam and goes on till Diwali (for some brands extending up to Christmas), lasting for 2-3 months.

“There’s a strong focus on short-term results right now, with brands investing more in performance marketing to drive immediate sales, rather than long-term brand building”, says Hemal Majithia, the Founder & CEO of OktoBuzz.

“Influencer marketing spends, which was less than 10% of ad budgets last year has gone up to 30% this year. There’s also a small but notable shift towards digital OOH advertising, especially with companies like AdOnMo putting screens in elevators, capturing attention in new ways,” he added.

The main advertising categories in the season have been - eCommerce, fashion, beauty, travel and tourism brands who largely spend on digital, especially on influencer marketing.

With brands prioritizing sales over marketing flair, the festive quarter is shaping up to be a quieter affair for the TV, Print and Outdoor advertising, raising questions about consumer engagement and spending patterns in the months ahead.

Notably, digital media commanded over 50 per cent of India’s ad spend, pushing TV to a distant second with nearly 30 per cent share in 2023, as per industry reports. The country’s ad market crossed Rs one lakh crore last year.

Missing world cup

“Last festive season was good because India had hosted the cricket world cup tournament around the same time. Although ad budgets got divided between sports and non-sports genres, the media industry had its hands full. This year, we don't have the cricket world cup. Moreover, primetime TV shows like KBC and Big Boss have not received good reviews this year, raising concerns among advertisers,” media planners said.

There is no change in overall spending if we compare H1 and festive season but brands who have been spending in H1 are not spending in H2, says Shradha Agarwal, Co-founder and CEO of Grapes.

“Only specific brands, which have recently launched new products or categories, are launching full-fledged campaigns in the festive season. In general, brands are not increasing spends during the festive season just to increase visibility,” she noted.