Madison revises down 2019 advertising expenditure

Print adex forecast remains unchanged

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The Pitch Madison Advertising Outlook Report 2019 has revised its forecast for advertising expenditure (adex) for 2019 downwards, mainly due to a decline in television adex in the first quarter of 2019. The forecast for print adex has, however, remained unchanged.

Adex is expected to grow at 13.4% to touch Rs 69,073 crore with television and outdoor registering a sluggish growth according to a revised forecast report. As per the original report published in February this year, adex was forecast to grow by 16.4% to touch Rs 70,888 crore.

Whilst there is no change in the growth forecast for print, digital, radio and cinema, there is a downward revision for television and outdoor, which has led to an overall downward forecast of adex for 2019. The major reason for the drop in television adex is the decline faced in the first quarter (January–March 2019), because of the new tariff order (NTO), which caused chaos in the television market and led BARC to issue an advisory, not to use ratings because of major changes in availability of channels, Madison said.

The Pitch Madison Advertising Outlook revised forecast says television adex will be Rs 26,050 crore versus Rs 27,649 originally forecast in February. Print adex remains unchanged at Rs 20, 429; digital adex stays the same at Rs 15,612 crore; radio adex remains unchanged at Rs 2,401; while outdoor adex has been revised to Rs 3,533 crore as against Rs 3,750 crore in the original report. Cinema adex also remains unchanged at Rs 1,047 crore.

In its original February 2019 report, Madison said that India is perhaps the only major market where print adex is actually growing year on year, although its growth rate is rapidly declining. India is probably the only country in the world where print still commands such a high percentage share of adex.

Print adex grew 4.4% in 2018, marginally lower than Madison’s projection of 5%. Despite this, it continues to be the second-highest contributor to adex, following television, with a share of 32%. The print share of adex in India is probably the highest in the world, according to Madison. In 2019, the print advertising market is expected to grow by 5% to come close to Rs 20,500 crore

Another interesting fact that brings out the resilience of print is that it has 200,000 advertisers and the number is growing, compared to television which has only 12,000 advertisers, the February 2019 report said. However, just five categories – FMCG, education, auto, retail, and eCommerce – dominate the print adex. In terms of category contribution, FMCG and auto are also the largest contributors to the print pie, with a contribution of 14%, followed by education at 10%. Contribution of eCommerce is way low at just 4%. Telecom, BFSI, and travel & tourism categories saw a fall in growth in 2018. It is significant that despite the sluggish real estate sector, this category has maintained its 6% share, Madison said.

In terms of volume, Hindi publications continue to be ahead of English publications, contributing 35% of the total volume while the share of English publications dropped by 2%, and now stands at 25%. In terms of growth too, volume of English publications has declined by 7% while Hindi publications grew by 2%. South publications, except Kannada, show a decrease in volume, the February report stated.

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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