Advertising after lockdown: Where would advertisers’ money go?

Advertising after lockdown

The entire country is under lockdown. Key activities like manufacturing, transport, logistics, and traveling have faced major restrictions. One of the worst affected is media and advertising. With IPL 2020 postponed indefinitely, the biggest marketing event of the country, both large and small scale advertisers are in the doldrums. Having said that, the country is witnessing positive development in the battle against COVID 19 and is expected to start relaxing the restrictions soon. Some questions that we often hear are:

  • Is it a good time to advertise?
  • Will advertising return to normal soon after the lockdown?
  • Are there advertising media that would take some more time before gaining advertisers’ attention?

With majority of people expressing their hesitation around going out and spending money on non-essential purchases, activities, and experience; there is a big question around the performance of outdoor, transit, airport, and cinema advertising in the near future. Traditional media had hardly recovered from the slowdown in 2019 H2 and the lockdown has further jolted consumer’s confidence. However, the silver lining here is that consumers expect brands to keep advertising. According to a survey by Kantar, only 8%  people said that brands should stop advertising.

Is it the right time to advertise after COVID lockdown
(Source: Kantar COVID 19 Barometer India Research)

Another reason, we think advertising is all the more important during this period is to boost consumer confidence and build trust. News around COVID 19 and its impact have created an environment of anxiety for the consumers who are skeptical about the future. With several fake news and false assumptions making rounds, authentic ads that reinstate the audience’s confidence in the brands are very much needed.

What type of advertising do people like during covid lockdown
(Source: Kantar COVID 19 Barometer India Research)

Despite people’s positive outlook towards advertising, the concern around dwindling advertising expenditure cannot be degraded. According to a survey by Kantar, about 79% of medium and small enterprises in India have been negatively affected by the lockdown. Also, with a majority of hyperlocal advertising solutions like transit advertising, in-store branding, cinema advertising, and to some extent, radio advertising being severely affected by lockdown and people staying home can also prove to become a setback for SMEs and startups. Needless to say, being home-bound is the best solution here. And that’s what we will discuss in the following sections.

Media consumption trends during the lockdown

Here are some of the observations about media consumption in India during the lockdown, shared by leading industry experts:

  • Television
    • About 50% jump in TV consumption during the lockdown period as compared to the pre-lockdown period, majorly driven by non-prime time consumption.
    • Due to lockdown, no shoot happening hence there’s a lack of fresh content that all TV channels except News channels are compensating using old classic content. And this move has been well-received by the audience, especially for DD channels.
    • Movies, News, and Kids have emerged as some of the most popular genres.
  • Print
    • The print has experienced some setback in COVID hotspots where newspaper printing and distribution has been halted.
    • With a plethora of online fake news on social media platforms, the high credibility of newspapers has led to an increase in audience engagement.
  • OTT
    • There has been a significant rise in OTT consumption (~ 31%) during the lockdown period, across demographics and devices. A large part of this growth is attributed to OTTs like Netflix, Amazon Prime, and Disney+ launch (Hotstar) that are subscription-based and not advertising-based.
    • Similar to television, due to lockdown, there hasn’t been any new shoot hence, a lack of fresh content. However, OTTs having an existing library of diverse content are less affected by it.
  • Online Gaming
    • Overall downloads and time-spent have witnessed a significant increase.
    • Fantasy sports have been adversely affected due to a lack of live sports.
  • Radio
    • Significant loss of listenership due to workplaces being closed.
    • Radio Jockeys are recording from their home which has ensured that the radio content is fresh and also serves as a relevant source of local news.
  • Cinema/Outdoor (including transit & airport)
    • With the closing down of cinema halls, airports, and a ban on public transports, this section has been hit the hardest with negligible consumption.

Media Consumption after Lockdown: What’s expected?

While the lockdown is expected to be over by May 4th, it wouldn’t be a cakewalk. While some of the essential activities would gain momentum, some would take more time to bounce back. It would largely depend on the phases in which the lockdown would be lifted and the time taken to gain the consumer confidence back. Here are some of the pointers laid out by KPMG report: COVID 19: The many shades of a crisis. The following table lays down the opportunities and challenges each medium would face and what’s the expected time for recovery after the lockdown, in terms of content generation, content consumption, and monetization (ad-revenues)

MediumCOVID 19 ImpactOpportunities/ChallengesViewership Back-To-Normal*Ad Revenue Back-To-Normal*
TelevisionHigh– Live sports events post lockdown can be a major draw
– High competition by digital OTTs
2-4 weeks4-12 weeks
PrintLow– Circulation is expected to pick up once the lockdown period is over
– High competition by digital channels
Immediate4-12 weeks
CinemaHigh– Recovery process would not be consistent across geographies due to varied restrictions around social gathering
– Due to halt in shooting and promotions, movie launch pipeline would be impacted
2 weeks2-12 weeks
OTTLow– Several OTTs offering free trial subscriptions which may lead to long term association2-4 weeks4-8 weeks
Online GamingLow– Likely to see an increase in ad revenues4 weeks4-8 weeks
RadioMedium– Strong presence in terms of local level and topical newsImmediate4-12 weeks
*Time taken after restrictions are lifted

TMA Insight: Which advertising platforms would attract the advertisers the most post lockdown?

The Media Ant website is visited by a million advertisers per year. And our traffic data has been a good indicator of industry trends and seasonality. Hence, we collected and analyzed The Media Ant Traffic data for the last six weeks (March to April Mid) compared to the previous six weeks and observed the following:

MediumTraffic ImpactMost Visited MediaFuture Outlook
TelevisionSignificant Increase in TrafficDD National, Star Plus, Aaj Tak, Sony Sab, ColorsPeople would continue spending more time on TV as they would continue to practice social distancing.
DigitalModerate Increase in TrafficHotstar, Inshorts, Tik-Tok, YouTube, Facebook, Times of India, Google Ads, Voot, Daily Hunt, Saavn, Gaana, Money ControlPeople would continue spending more time on video and audio OTTs, online news platforms and social media for entertainment, connection and updates as they continue to maintain social distancing. With people returning to work, video on demand would be consumed more than fixed-time broadcast.
NewspaperModerate decrease in trafficNAAs soon as movement restrictions are lifted, newspaper distribution would recover. However, people might still be reluctant in using physical newspaper. Hence, newspaper might take some time to bounce back.
RadioModerate decrease in trafficNAAs people start commuting to work, radio listenership would rise but since people would be still reluctant to use public transport, radio too might take some time to return to normal.
CinemaSignificant decrease in trafficNAVisiting cinema halls being a non-essential activity and major projects being delayed, cinema might take a longer time to attract audience.
Outdoor/Non-Traditional/AirportModerate decrease in trafficNAWith travel restrictions expected to be lifted soon, work-related traffic would return to roads, trains and airports making transit, outdoor and airport advertising back in moderate demand. .

As the above-mentioned data suggests, advertisers are interested in the media platforms expected to be consumed the most.

We also noted that though metro cities were the one facing some negative impact, lockdown had negligible or positive impact on the traffic coming from tier 1 and tier 2 cities exhibiting a change in behavior from offline planning to online media planning.

Cities with the highest impact

Increase in VisitsNo ImpactDecrease in Visits
Indore
Jaipur
Ludhiana
Nagpur
Thane
Pune
Kolkata
Lucknow
Patna
Bhubaneswar
Mumbai
Bengaluru
Delhi/NCR
Hyderabad
Chennai

Summary

In this article, we have discussed the following major points:

  • Why is it a good time to advertise?
    • To boost consumer confidence
    • To build trust and earn credibility
  • Which advertising platforms would attract audience the earliest?

In our opinion, based on the inference from industry reports and our website data, we think not all platforms would return to normal at the same time. Here’s what our analysis says.

QuickestQuickerSlowerSlowest
Digital- OTT
Digital- News
Digital- Online Games
Television
Newspaper
Radio
Transit
Airport
Outdoor
Cinema
Mall
Tech Parks

Reference

  • TMA Traffic- Google Analytics
  • Kantar COVID 19 Barometer India Research
  • KPMG report: COVID 19: The many shades of a crisis

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2 Replies to “Advertising after lockdown: Where would advertisers’ money go?

  1. Very well articulated Samir. Couldn’t agree more with the detailed analysis that you’ve given.

    Coming from sales background, IMO, the brands will Want to bounce back like never before and will not be easily convinced with the off-the-shelf or traditional offering unlike pre-Covid times. Instead, there will be a huge inclination towards a wholesome end to end media solution. At the end of the day, brands will start looking at Value than Volume. In a way, this Covid is acting like a dipstick for all media owners.

     

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