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Rediff News  All News  » Business » Advertisers become selective about TV channels

Advertisers become selective about TV channels

December 29, 2008 12:39 IST

Marketers are now looking at consolidation with top three-four channels in a genre and effecting long-term deals with frequent reviews.

While the rates for the top television players' inventory in a genre have yet not dropped, media buying agency Mudra Max president Chandradeep Mitra tells Business Standard, "Due to the weakening demand there has been a drop of 30-40 per cent in the revenues of the marginal players in television."

The reason, "consolidation due to a liquidity crunch," notes Kevin Vaz, executive vice-president (sales), Star Network. "Marketers are consolidating from 10-12 different general entertainment channels to just top three-four channels in a mix now," he adds.

Zee Network grew its top line at 41 per cent during the half-yearly period of March-September 2008. "The demand will not be as robust in the coming year," says Joy Chakraborthy, chief revenue officer, Zee Network. However, "For now, we have not reduced our prices as there is demand for our inventories especially in the regional channels where we are the premium players," says Chakraborthy, who is adopting a wait-and-watch policy and not effecting any changes in strategy.

According to a PricewaterhouseCoopers study in 2007, 'The television industry was estimated to grow at a compounded annual growth rate of 22 per cent from Rs 19,100 crore in 2007 to Rs 51,900 crore in 2011.

However due to the current spate of events, "We expect to make revisions in the growth rate as there will be a marginal decline in the overall industry growth rate," says Smita Jha, associate director, PwC.

The other trends coming to the fore include an increase in long-term deals and media owners offering "360 degree solutions" and creative deals.

For instance, the recently-launched Rs 10-crore (Rs 100 million) The Great Indian Shopping Festival campaign of Future Group was exclusive to Star Network.

"This is the first time a retailer has consolidated its campaign with a network," said Vaz, who is countering the negotiations with clients for reduction in prices by offering creative solutions.

"We offered the Future Group a 360-degree solution where the campaign would be included as content on its soaps as well as they would have stars visiting the malls besides airtime," says Vaz.

Industry players like Idea are also looking at long-term deals with media owners. "There has been an increase of 15-20 per cent in the number of long-term deals that range in the period of 12-24 months for us," says Vaz, who expects to sign up many more clients for longer time period in the coming months.

Sapna Agarwal in Mumbai