MxMIndia

Category: INDRANI SEN

  • Our A&M industry acknowledges that internet usage and digital marketing in India will ride on the rapid growth of mobile penetration, writes Indrani Sen

    Indrani Sen: The need of the hour: Spread of high speed data connectivity

    By Indrani Sen

     

    Last week while travelling from Mumbai to Kolkata by Mumbai-Howrah Dooranta Express, I read on my smartphone the ET Brand Equity report on “India’s digital media & entertainment sector is set to transform in 2018“ with a lot of interest and curiosity.  (https://brandequity.economictimes.indiatimes.com/news/media/indias-digital-media-and-entertainment-sector-to-see-a-transformative-year-in-2018/62360682). My appreciation of the viewpoint that the said transformation is riding on the high speed data connectivity now available in India did not last long as my 4G network dropped to 3G and then to 2G and then in no time to ‘no network’.

     

    Travelling from Mumbai to Howrah, one has to pass through Maharashtra, Madhya Pradesh, Odisha, Bihar, Jharkhand and West Bengal in the 28-hour journey. My 4G network played hide and seek with me throughout the journey, showing up when the train was nearing a major town and disappearing gradually after the train crossed that station! I would like to mention in this connection that I had a totally different experience regarding internet as well as network availability while travelling abroad by train and by road.

     

    By now, it is quite clear that the government’s plan for providing free internet access in public places will take many more years to get functional due to various financial and technical constraints. Ouradvertising and marketing industry acknowledges that internet usage and digital marketing in India will be riding on the rapid growth of mobile penetration with youth spearheading the adoption of digital media.To ensure uninterrupted network availability, it is essential to bring Tier II and III towns under the coverage of the telecom network as they play a major role in the distribution structure of various non-durables and durables and act as the gateway to rural marketing. More than 3000 towns belong to Tier II and III and almost 31% of our total population reside in those towns. Unless our telecom service providers can reach out to these towns with high speed data connectivity, the transformation of our digital media and entertainment sector will remain metro centric and will create a digital divide between large cities on one side and small towns and villages on the other side.

     

    The above article quoted Gaurav Gandhi, COO of Viacom18 as saying: “We have more than doubled our monthly active user base to more than 25 million users in the past six months, with the top 40 cities contributing close to 70% of the viewership…..Also, more than 25% of digital media consumption came from regional language audiences”. It is quite evident from the Viacom18 experience that the current digital media audience base is concentrated in the large cities. The growing importance of digital content in regional media also cannot be ignored.

    Reliance Jio has played a major role in accelerating the spread of high speed data connectivity in India. Jio connectivity was available in nearly 18,000 cities and 200,000 villages by September 2016. Recent search on the internet did not yield any update on that information. As per earlier EY estimates quoted in ET Brand Equity smartphone penetration is expected to be up to 59 per cent by 2020 from 31 per cent in 2015 and digital ad spend is slated to be Rs 185 billion by 2020, (https://brandequity.economictimes.indiatimes.com/news/digital/infographic-indian-digital-sector-to-cross-rs-20000-crore-mark-by-2020/56518988) constituting a larger pie (approximately a quarter) of the overall media spends.EY also predicted the rural internet user base would surpass the urban user base by 2020 with regional content as a key area of focus.

    With only two years to go before we hit 2020, it is doubtful if the number of rural internet users will surpass the number of urban internet users by 2020, but at the same time it may be possible if the high speed data connectivity is made available in the Tier II and Tier III towns. Rural connectivity will automatically improve as the surrounding rural areas between different small towns will get the spillover coverage. So, the need of the hour is to spread the high speed data connectivity as quickly as possible across India for turning our digital dreams to reality.

     

     

  • It’s high time language newspapers challenge the difference in ad rates of English and language media, writes Indrani Sen

    Print shines in IRS2017

     

    By Indrani Sen

     

    The IRS 2017 Topline Report released on January 18, 2018 has reinstated the advertising and marketing industries’ trust in audience research. Kudos must be given to MRUC, RSCI and Nielsen for getting the world’s largest readership survey back on track. IRS 2017 is a definitely a richer version of its predecessors, backed by enlarged sample size, changes in methodology, introduction of new readership metrics and concepts enabling in depth analysis of not just print media but overall media consumption. The strict scrutiny and quality control designed and deployed by the IRS TechCom helped in ensuring the accuracy of the findings.

     

    MRUC however has to revisit the common NCCS definition and the durable based grid as already pointed out by Shripad Kulkarni in “IRS 2017 Top 5 Takeaways” on January 19. With rise in electrification, LPG stove ownership, B&W TV production becoming obsolete and every third home possessing a two-wheeler, it is not surprising that NCCS D/E have been found as “Fast Shrinking”. However, the reality may be different riddled with power cuts and shortage of LPG Gas cylinders, particularly in rural areas. Ownership of colour TV provides the 24X7 entertainment to the entire family at a very low cost through cable operators and DD’s Free Dish. Ownership of two-wheeler is a necessity for a livelihood to many living in Tier 2 and Tier 3 cities. How far the ownership of ceiling fan, LPG stove, two-wheeler and colour TV will help us in the socio-economic classification indicating the disposable income of the house holds should be re-examined. At the upper end, NCCS A1 and A2 seems to be apparently stagnant, however, based on the growth in the number of total households, there has been a few crores growth in the numbers of A1 and A2 households.

     

    In spite of the growth in urbanisation, 2/3rd of the almost 30 crores home in India still belong to the rural area. It is encouraging to note that TV reach and Newspapers reach are growing at a faster rate in rural area than in urban area.Again radio reach and newspaper reach are growing at faster rate than TV reach in urban area.

    All these reach figures are calculated on the basis of reach within 12+ individuals in last 1 month, the new readership metrics introduced in IRS 2017. Dailies added 11 crore readers in last three years, of which 4 crores came from urban India and 7 crores from rural India. On the demographic front, the readers among the younger age groups (12-15, 16-19, 20 -29 years) have shown higher growth than the older age groups. With more than 40% of our population below the age of 20 years, this trend is encouraging for the future of Print media.

    The high readership among the younger age group probably explains the stagnation in the yesterday readership against the growth in the other categories, up to 3 days, up to 7 days and last 1 month. Readers below 20 years and in their early twenties may not be regular readers of newspapers due to their pre-occupation with studies and other activities.

    This rise in readership of newspaper among younger age groups is a phenomenon of non-metro Tier 2 and Tier 3 cities and rural areas as we do not see the reflection of this trend among the youth in the metro cities, skewed to English medium and digital media. IRS 2017 has found that newspaper read online is only 26% among NCCS A1, so our educated urban youth probably are engaged with other content on the internet.

     

    Except Times of India which ranks 11th,the Top 20 dailies are all in Hindi and other regional languages. From 2014 to 2017 most of the regional languages dailies have grown more than the growth of English dailies (10%). The highest growth has been achieved by Oriya which, from a smaller base, has grown by 83% while Bengali has grown by 9%. Among the South Indian Languages, Telegu has grown by 66%, Tamil 44% and Kannada 37%. Malayalam newspaper market is more saturated and has shown only 19% growth. Marathi has grown by 31% with Gujarati scoring above it with a 45% growth. Hindi has also grown by 45% while Punjabi and Urdu have grown by 51% and 53% respectively from smaller bases.

     

    Armed with the findings of IRS 2017 and various other studies which show the growth potential of the smaller towns and rural areas, it is high time for the language newspapers to challenge the difference in the advertising rates of English and language newspapers in India. Marketing communication in any regional daily can work effectively when the content is also effectively designed in the same regional language and is not a poor translation from English or Hindi.As our creative agencies have not shown much interest in developing content in regional languages, perhaps the regional language newspapers can explore the option of developing advertising content for their own markets. If journalism can develop so well in regional language, it may not be difficult to develop advertising content and increase profitability in the new era of content marketing.

     

     

  • If we have to effectively communicate with our audiences in Digital India, then what will be the language of communication, asks Indrani Sen

    The Deep Divide

     

    By Indrani Sen

     

    The advertising and media industry has applauded the Union Budget 2018 focusing on the rural and agricultural sector with doubling of allocation to Rs 3,037 croreon Digital.By end of 2018, Wi-Fi hotspots in the country are expected to grow from 38,000 to 5lakh ensuring that every village has access to at least one Wi-Fi hotspot providing internet access to crores of Indians living in rural areas. The Budget has proposed broadband connectivity to 2.5 lakh Gram Panchayats under the Bharat Net project deploying high end Blockchain technology. Artificial Intelligence will be employed by NITI AAYOG for national development. Rs.10,000 crore has been allocated to telecom industry for early adoption of 5G.

     

    As we accelerate fast forward to Digital India, it is the right time for the Communication Industry to deliberate on the deep divide in the language of education and language of communication in India. If we have to effectively communicate with our audience in Digital India, then what will be the language of digital communication? How are we going to create effective and efficient content for the crores of rural citizens who are going to be digitally enabled within a very short span of time?

     

    Almost all smartphones selling in India now are enabled with regional language settings and we are increasingly noticing the use of regional language in texting and chatting on various platforms like Whats App, etc. The practice of using English typeface for writing messages in regional language is also a common practice among mobile phone users across our country. We have also started receiving on our mobiles sales and promotional messages in Hindi and other regional languages. Social media platforms like Facebook etc. as well as email services like Google Mail also offer the use of regional languages. We do not have any research which has explored the use of regional language by mobile phone users or internet users in India, so it is difficult to assess their numbers, but they are definitely growing.

     

    According to IRS 2017, the percentage of children studying in English medium schools varies widely from state to state as seen in the table below:

     

    On Dec 1, 2018 DNA published a report stating that only 17% children in India go to English medium schools (http://www.dnaindia.com/academy/report-only-17-children-in-india-go-to-english-medium-schools-2278538). There have been lot of debates on how this issue should be addressed in our Education Policy which follows a three language (English, Hindi and mother tongue) formula for school education. The RSS-affiliated Shiksha Sanskriti Utthan Nyas has been asking the Indian government to make Hindi the primary medium of instruction across all schools in India instead of English or state language. On the other hand, educationists and researchers have been pointing out that a child understands any concept best in her or his mother-tongue. They have been arguing that India’s craze for English-medium schools is depriving many children of a real education.

     

    My intention is not to engage in such debates related to the medium of education, but to merely point out that our Media & Entertainment Industry (TV, Print, Radio and Cinema) is thriving on Hindi and regional language content in spite of our so-called craze for English medium education. The advertising industry has managed to keep pace with brand communication in various languages across India by outsourcing the copywriting or script writing in regional languages. As consumers become digitally enabled, they will find it more and more difficult to manage the digital content creation for their brands in regional languages.

     

    A deep divide seems to exist between the language of communication used by our advertising industry and the language understood and appreciated by their target audience across India. A partial solution may be provided through hiring resources proficient in regional languages and can lead the digital content creation in regional languages. An alternative business model for digital marketing and advertising may emerge to bridge this deep divide which may squeeze the shrinking profitability of the creative agencies in Digital India.

     

     

  • On the eve of the World Radio Day, Indrani Sen hopes that private FM organizations will invest in research to bridge the gap in our knowledge of radio listeners In India and the Indian advertisers will realize the potential of this low cost medium and use it effectively to get better ROI of their advertising campaigns

    Indrani Sen: The Second Rising of Radio

    By Indrani Sen

     

    Radio has come a long way since Guglielmo Marconi sent his first radio signal in 1890s and the first radio commercial crackled over radio waves in New York in 1922. After advent of TV, it was written off by many of us in advertising and marketing and some of us thought that Digital will drive the last nail to close its coffin.  Contrary to popular belief, radio refused to die and we are currently witnessing its Second Rising in the digital age as the second most effective medium in driving purchase intent as revealed by a recent research conducted by Nielsen, commissioned by Music Broadcast Ltd (Radio City). The research showed radio outpaces social networks. social.htmlhttp://www.livemint.com/Consumer/vBLB4xcdPUmEHCzafXUUoI/Radio-emerges-as-second-most-accessed-media-outpaces-social.html.

     

    In 2012 UNESCO proposed February 13, the day the United Nations Radio was established in 1946, as the World Radio Day for promoting worldwide access to information and freedom of expression through radio, a powerful information tool which can reach remote communities and vulnerable people across the world. The date was proposed by France and verified by UNESCO through a feasibility study in 2011. On 14 January 2013, the United Nations General Assembly formally endorsed UNESCO’s proclamation of World Radio Day.  The fact that this decision was taken when internet and world wide wave were well established, goes to prove the enduring power of radio as a medium.

     

    In the two decades of this millennium, various research studies have shown time and again the utility and efficacy of radio as a medium in the digital age. I would like to cite a few of such studies done in this decade. In 2011, Bob McCurdy wrote “Consumers who listened to the stations with the manufacturer’s commercials were 13% more likely to consider buying its camera than those who did not listen to those stations” based on a research done for a camera manufacturer (https://www.mediapost.com/publications/article/152687/a-study-in-radios-effectiveness.html). Among many other articles on radio research, an interesting one by Matt Petronzio was published in www.mashable.com  in 2013- “Enduring Power of Radio in the Digital Age”. (https://mashable.com/2013/02/13/radio-in-the-digital-age/#YttXF21seiq3)

     

    In 2014, research done by Nielsen Catalina Solutions “found a direct link between radio advertising and brick-and-mortar retail sales—evidence that money spent on radio is money well spent. In this first major radio effectiveness study, the research found that each dollar of ad spend generated an average sales return of $6 from the listeners in the 28 days after they heard the ads.” (http://www.nielsen.com/us/en/insights/news/2014/for-advertisers-radio-is-worth-listening-to.html)

     

    In 2015, Campaign UK carried an article “Radio is ‘20% more cost-effective’ at building brands, research claims” based on research done by Radiocentre, the trade body for British radio. https://www.campaignlive.co.uk/article/radio-20-cost-effective-building-brands-research-claims/1414239. In 2016, Angela Jeffrey posted an article “Advertising Effectiveness – New Research Shows Radio Potentially Most Effective Medium” based on  “ABX research on how radio may deliver the best ROI and ROAS of all with some smart creative” with a caveat that the radio advertising must be smart and entertaining. (http://blog.adbenchmark.com/advertising-effectiveness-in-radio).

     

    In 2017, Nielsen, who has done maximum number of research on effectiveness of radio, complied several of such studies into a new compendium for distribution to their clients. The title speaks volumes: “Radio (Re) Discovered, A Brand Manager’s Guide To Radio”.  (http://www.insideradio.com/free/nielsen-pushes-radio-effectiveness-with-best-of-roi-guide/article_6814f010-889d-11e7-a4b5-7343ce99ae17.html).

     

    It is expected that after Phase 3 expansion of FM network is complete, nearly 60% of the geographies of our country will be covered by private radio stations which will increase the reach of the medium by many folds. Various recent experiments done in India by independent advertisers have shown that radio ads lead to searching on the internet and promotes e-commerce in the most cost efficient way.

     

    On the eve of the World Radio Day, let us hope that other private FM organizations will invest in research to bridge the gap in our knowledge of radio listeners In India and the Indian advertisers will realize the potential of this low cost medium and use it effectively  to get better ROI of their advertising campaigns.

     

     

  • Could RK Joshi’s vision of a common script for Indian languages make things easier for the A&M fraternity, wonders Indrani Sen

    Could ‘Deshnagari’ have bridged the Vernaculars?

     

    By Indrani Sen

     

    Over the last few weeks, various issues related to advertising communication in regional languages in India were highlighted.First, the IRS 2017 alerted us about the increasing importance of vernacular newspapers in India. Then we got the reviews and forecasts of AdEx in India: TYNY2018 and PMAO2018 and both pointed out the role which Hindi and other vernacular languages are playing in our media consumption and media revenue generation.

    In TYNY 2018, GroupM has mentioned 3Vs asthe future gamechangers, the key drivers for media consumption in 2018 – Video, Voice and Vernacular. PMAO’s analyses of advertising spend by languages for TV and Print in 2017 has confirmed the growing importance of communication with consumers in their mother tongues/ vernaculars as compared with communication in English. As shownbelow in the two charts, around 19% of revenue contribution of TV AdEx is made by English language channels. In case of Print AdEx, the share of English newspapers is 27%, while the growth in revenue is favouring Hindi and other vernaculars. Against this backdrop, our A&M industry continues to think, strategise, develop and execute advertising communication in English.

     

     

    It is not an easy task to think and design advertising communication in various regional languages in India, even though many/most Indian languages have their roots in Sanskrit. As all languages (except Hindi and Marathi) have different scripts, it is a very hard task for an Indian to learn anotherlanguage even if the person is efficient in her/his mother tongue or the official language Hindi. While musing over the issue, I suddenly remembered about “Deshnagari”, the dream project of a visionary communicator, late R K Joshi (1936-2008), who was awarded the Lifetime Achievement Award by Ad Club,Mumbai in 2004.

     

    During the early days of my career (1975 to 1979), while working with Ulka Advertising (now FCB Ulka) in Mumbai, I was fortunate enough to be come in contact withR K Joshi,Ulka’s legendary Art Director.An artist, designer, calligrapher, poet and a teacher, his passion was Indian typography and type design. He was associated with National Centre for Software Technology (now Centre for Development of Advanced Computing – C-DAC) since 1976.  Through C-DAC, he later got involved in the Microsoft Project and developed a series of O/S fonts for Windows 2000 to enable typing in Indian languages on Windows.

     

    RK used to teachus, the young entrants in advertising, about the importance of understanding Indian culture and values for designing meaningful advertising communication, about the need for communicating in vernaculars to Indian audience for ensuring effective results of advertising campaigns. He used to insist that everyone involved in advertising communication in India, should know at least one regional language well enough to judge a good copy from a bad copy.

    RK was deeply concerned that different scripts used by different regional languages stood as a barrier to our learning, understanding and communicating across regions and states in India. Hetold us about the work he was doing for designing and developing typographically a common script which can be used by all Indian languages, like the Roman alphabet and script is used by all most all European languages. RK named this new script “Deshnagari”. He redesigned our alphabets after researching on the phonetics of a number of regional languages and invented a common script which can be used for writing all vernaculars.

    After I left Ulka, I heard that RK made a presentation on “Deshnagari” to the Indian government, who praisedhim for his efforts andpromised to review his proposal in due course.Wikipedia (https://en.wikipedia.org/wiki/R_K_Joshi) mentions under R K Joshi’s association with C-DAC “Another series of multilingual fonts for 12 Indian languages were developed under project IndiX”. Most likely, this reference relates to the “Deshnagari” project and hopefully the archives of C- DAC still has records of this path breaking research work of RK Joshi whose thoughts and visions were ahead of his time.

    Just imagine how much easier life would have been today for all of us Indians and for our A&M industry, if in 1980s our government could have taken a decision to introduce “Deshnagari” as the common script for all Indian languages. Over last three decades, we would have been able to bridge all the vernaculars in India with a common script! But, alas, given the politics of linguistic states in India, such a move would not have been impossible during the 1980s and probablycannot be implemented even now. So, Deshnagari, a common script for our vernaculars would perhaps remain as an unfulfilled dream of a legendary communicator.

     

     

  • Indrani Sen spent the weekend pouring over the GroupM TYNY &Madison PMAO numbers and rues that the gap in TV AdEX has widened

    Mind the TV AdEx Gap!

     

    By Indrani Sen

     

    For two consecutive years, TYNY by GroupM and PMAO by Madison were released during the same week, giving the industry lot of food for thought and facts and figures to chew and digest. TYNY or ‘This Year Next Year’ closed the estimate for total AdEx 2017 at Rs 61,263 crore with a growth rate of 10% over 2016, while PMAO or ‘Pitch Madison Advertising Outlook’ showed a growth rate of 7.4% in 2017 over 2016 and estimated the total AdEx as Rs 53,138 crore.

    After a year of stagnation and stunted growth in 2017, mostly due to the after effect of Demonetisation and Goods & Services Tax (GST),both the reports predict a better year in 2018 with a growth of total AdEx by 13% and 12% respectively.

    According to both the reports, Digital is going to have the highest growth in AdEx in 2018, 30% according to TYNY and 25% according to PMAO. Both reports predict 13% growth in TV AdEx and 4% (TYNY) and 5% (PMAO)in Print AdEx. Both agree that the highest growth after Digital will be achieved by Cinema (20% TYNY & 14% PMAO) which has the smallest share of the advertising pie. Both have shown same percentile growth rates for OOH and Radio (15% TYNY & 10% PMAO).

    The chart below shows that PMAO’s estimates for growth for all media, except TV and Print, are more conservative than TYNY.

     

     

     

    In my analysis of the two reports last year (http://www.mxmindia.com/2017/02/what-is-the-real-size-of-indian-ad-industry/), I found a difference of around Rs 5000 crore between the two projections made by TYNY and PMAO for all media in 2017. The difference was mainly due to the disagreement between the projections for TVAdEx in the two reports with GroupM’s projection being almost Rs 6000 crorehigher than PMAO’s.

    In the projections for 2018, the gap in the all media AdEx between the two reports has widened to almost Rs10,000 crore with TYNY predicting the total industry size as Rs 69,347 crore and PMAO predicting it as Rs 59,530 crore. As seen last year, most of this difference is due to the Rs 9,391cr difference in the projections of TV AdEx shown in the two reports.

     

     

     

    Unless this widening gap in TV AdEx is reviewed by both the agencies and explained to the industry at large, it would become increasingly difficult for the A&M industry to assess the actual size of the TV AdEx. I think there must be a difference in the methodology followed by the two agencies for estimating TV AdEx which results in the different estimates.

    On behalf of the A&M fraternity, I appeal to both GroupM and Madison for a clarification so that we have a better perspective and understanding about growth of Indian advertising by media over the years.

    Indrani Sen is a veteran advertising professional and is now Adjunct Professor with the Symbiosis International University, Pune. The views here are her own

     

     

  • It is a full war out there on the internet for winning Indian consumers with varied video content, writes Indrani Sen

    The Streaming Warriors

     

    By Indrani Sen

     

    The two biggest global video streaming services, Netflix and Amazon Prime, have shifted their focus to India over the last two years. Netflix, who was the first to launch in India in December 2016, has been overtaken by Amazon Prime, launched a year later, in their debut year. By end-2017, Amazon Prime held 10% share of the Indian OTT streaming market with Netflix holding 8% share according to the data shared by the London based firm IHS Markit with Quartz. (https://scroll.in/reel/868786/why-amazons-streaming-platform-has-overtaken-rival-netflix-in-india).  Globally, Netflix is the leading video streaming service provider except in Japan, Germany and India where Amazon Prime leads. In India, the Hotstar is the leading video streaming service, which along with Voot and couple of other home grown services controls almost 80% of the segment.

     

    Netflix focused on the top end of the market and aimed mostly at the early adopters of the video streaming services. Accordingly, more than two thirds of their content is in English with Indian language content limited only to Hindi and Bollywood. On the contrary, Amazon Prime targeted a wider group of audience with less than 65% of their content in English, 25% in Hindi and more than 10% in other Indian languages. According to research, Indians spend 93% of the time on online video watching content in Hindi and regional languages. So, the formula of only western content for the top end of the market or even western plus Bollywood content does not hold the key to successful winning of the emerging Indian audience for online video streaming.

     

    Netflix has lost out to Amazon also in the price war in the highly price sensitive Indian market. Amazon strategically decided to offer a significant discount for entering the Indian market after Netflix. Their launch price of Rs 500 per year was subsequently doubled to Rs 999 per year where as Netflix charges Rs 450 per month from their customers. The annual subscription fees paid by the consumer for Netflix are more than 5 times the annual subscription fees of Amazon Prime. Off course the Freemium model of Hotstar seems to be the top most favourite of Indian consumers with the free base tier (with ads), and a single premium tier that costs Rs 199 a month.

     

    Amazon has announced an investment of $300 million in 2018 for creating original content in Hindi and regional languages.  They have tied up with big production houses like Dharma Productions (Karan Johar), Vishesh Films (Mukesh Bhat), etc. They have struck a deal with Salman Khan allowing them to show his titles before satellite or TV channels. It is rumoured that they have tied up with more than a dozen of stand up artists across the country.  James Farrell, Asia-Pacific Content Head, Amazon Prime Video, said in a recent interview, Amazon Prime video content is growing faster in India than any other country.(https://www.exchange4media.com/digital/amazon-prime-video-is-growing-faster-in-india-than-any-other-country-content-head-apac_88861.html)

     

    Netflix bagged an exclusive deal with Shah Rukh Khan’s Red Chili Productions in 2016. This year they have released their first mainstream Hindi movie, “Love Per Square Foot”.  Their original India series, Sacred Games directed by Anupam Kashyap in the making. Comedian VirDas’s Netflix special was released in early 2018. Still they have some catching up to do to beat the multi-lingual content portfolio of Amazon Prime. Reed Hastings, Chairman& CEO of Netflix, recently visited India for attending the Economic Times Global Business Summit. During an interview with Economic Times, he said about Indian market “It’s a good market, a different market and we just don’t compete for advertisement revenues. We will evolve over the years to do more languages and more Indian content, again both for India and for around the world.” (https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/india-is-a-key-part-of-international-subscription-growth-netflix/articleshow/63074317.cms).

     

    The market research firm, Counterpoint Research, has reported that Hotstar is the largest video streaming service in India, with around 75 million subscribers, followed by Viacom 18’s Voot with 22 million subscribers, Prime Video with 11 million subscribers. (https://www.androidcentral.com/netflix-getting-crushed-india-and-its-because-amazon-and-hotstar). In India Netflix (totally ad free) is in the fifth position with around 5 million subscribers. According to industry sources, Amazon is developing an ad supported, free version of its popular Prime video service, which may work well with the price conscious consumers in India.

     

    Hotstar, apart from offering the content from the Star Group, has the digital rights to HBO shows in the country. Currently, Hotstar streams Game of Thrones episodes same day they air in the U.S. This advantage along with the exclusive rights to stream cricket and football games in India has made Hotstar the most favorite Video Streaming Service. Voot has shows from TV channels which are owned or are subsidiaries of Viacom 18, namely MTV and Colors in various regional languages.

     

    Airtel Movies, also offers good movie content. SonyLiv, as well as HOOQ subscriptions, are all heavily loaded with Indian content which is helping their growth. ALTBalaji, a wholly owned subsidiary of Balaji Telefilms Ltd.launched on 16 April 2017, is the latest entrant in the home grown segment. Ekta Kapoor plans to create original, premium, and tailor-made content especially for Indians across the globe. But, she has an in depth understanding of the Indian audience and stands a good chance of attracting them to her streaming platform with good video content in various Indian languages.

     

    Needless to mention that availability of affordable data and easy access to internet are helping the growth of the streaming services. It is a full war out there on the internet for winning the Indian consumers with video content of different types, different colours and hues. As India reaches the “Digital Tipping Point” (please see my article http://www.mxmindia.com/2018/03/indian-me-industry-at-its-digital-tipping-point/) the war is going to intensify for winning over the emerging Indian users of streaming video services. The demand for content creation and marketing will also increase as brands will seek ways and means for reaching the emerging Indian audience of the video streaming services.

     

     

  • One can expect online media campaigns gaining at the top end of the consumer pyramid, writes Indrani Sen

    Indian M&E industry at its Digital Tipping Point

     

    By Indrani Sen

     

    “All the segments of the M&E sector are showing growth, consolidation and innovation led by digital, both on consumer side and the content supply chain,”noted Uday Shankar, Chairman, FICCI Media & Entertainment Committee in the introduction of FICCI-EY Report 2018.According to the experts from EY, Farokh Balsara and Ashish Pherwani, the Indian Media & Entertainment Industry has reached its Digital Tipping Point. In other words, thereare significant changes happening all around our M&E industry to cause a larger, more important change which will see the transformation of our country to Digital India.

     

    The FICCI-EY Report 2018 has highlighted quite a few of these changes: distribution of television has become largely digitised increasing its addressability and reach, the OTT platforms for TV and video content are growing rapidly, both print and radio segments are growing continuously with more focus on their digital presence, exponential growth (though from a small base) of digital subscription and online gaming riding on falling data cost, emergence of India as the second largest smartphone market in the world giving easy access of internet to consumers, rapid growth of digital micro-payment ecosystem across urban and rural markets, etc.

     

    The above changes are expected to grow our digital content consumption substantially which in turn would increase the size of the total industry from INR 1.5 trillion (USD 22.7 billion) in 2017 to INR 2 trillion + (USD 31 billion+) by 2020 at a CAGR of 11.6%.

    Source: FICCI-EY Report on M&E industry 2018

     

    As shown in the above chart, while the industry grew by 13% from 2016 to 2017, the growth was led by digital, film, animation & VFX, gaming and events. The same trends are expected to continue over the next three years. Another significant trend, which has been seen for the first time in the M&E sector, is outpacing of advertising growth (under10 %) by subscription growth (almost 15%) in 2017 over 2016. This trend will continue to be a major contributor to the Digital Tipping Point.

     

    Based on this new trend of growth in subscription,the report has made a forecast on new customer segmentation which will be an integral part of Digital India by 2020. This new consumer segmentation will be important for the A&M Industry for targeting their audience.

     

    Source: FICCI-EY Report on M&E industry 2018

     

    We can assume that there will be a process of continuous migration from the bottom tier of mass consumers to the tactical digital consumers to the only digital consumers as we go forward to the next decade. As far as deployment of resources for advertising is concerned, we will see online media campaigns slowly gaining over the combination of online and offline media campaigns at the top end of the consumer pyramid.

     

     

  • Mobile internet is the script of media planning strategies, writes Indrani Sen reviewing reports by IAMAI-IMRB, InMobi& FICCI-EY

    Mobile Magic on a High

     

    By Indrani Sen

     

    Last week, two interesting reports on usages of mobile and mobile advertising were released prompting strategic planners in media agencies to do quick reviews of the mobile advertising strategies recommended for their clients for the current year.The first one, the  ‘Mobile Internet Report 2017’, jointly published by Internet And Mobile Association of India (IAMAI) and Kantar IMRB predicted that the number of mobile internet users will reach 478 million by June 2018. The second study by InMobi surprised us with the insight that programmatic advertising expenditure on mobile has grown by more than 500% from Q1 2017 to Q4 2017.

     

    The writings on the walls, in this case the small screens, were there for the last few years, but the positive indications started coming from last year. Kleiner Perkins Caufield & Byers partner Mary Meeker descried India as the “most fascinating markets for the internet on the planet” and “an incredibly fierce battleground right now for hardware and software companies” while predicting on the trends of 2017 at the Code Conference on May 31, 2017. https://www.recode.net/2017/5/31/15720378/mary-meeker-india-annual-internet-trends-report-code-2017. Meeker highlighted in her presentation the dramatic and accelerated changes in Indian mobile market from 2016. She said that “Excluding China, Indian users spend the most time on Android devices. People in India spent nearly 150 billion hours on Android devices in 2016. They’ve also become the biggest downloaders of Google Play apps.”

     

    She further commented that Indian wireless data prices are still relatively high but they have been falling steadily over the years and was down about 50 percent from Q1 2016 to Q1 2017, after the Reliance Jio Launch.  Cheaper wireless data has accelerated the growth of smartphone ownership and has caused data consumption to jump year over year.

     

    The FICCI-EY report on M&E Industry 2018 showed that internet penetration in India is being driven by Mobile Internet. It estimated that 75% of the overall wireless internet base and 90% of the broadband subscriber base are mobile users, which supports the prediction of IAMAI.

     

    According to the media release by IAMAI, the number of mobile internet users increased by 17.22% from December 2016 to reach 456 million users by December 2017. Urban India had 18.64% Y-o-Y rise, while Rural India 15.03% during the same period. The report predicts with 59% mobile internet penetration, Urban India will witness a slowdown, while Rural India with only 18% penetration will be next area of growth. The report further confirms that Mobile Internet is predominantly used by youngsters, both in urban and rural areas.

     

    Programmatic advertising was still in its nascent stages in India in 2016. However, with the growth of digital advertising, it is inevitable that programmatic advertising would also grow in India. The FICCI-EY Report on M&E Industry 2018 estimated that 10% to 15% of all advertising expenditure was through programmatic advertising in 2017. It predicted that by 2020 its share may grow to 50%. The In Mobi report seems to differ from the FICCI-EY Report as it indicates an accelerated growth of mobile programmatic advertising spend by 534% (by ten times) from Q1 to Q4 of 2017.  https://www.exchange4media.com/digital/mobile-programmatic-ad-spend-grew-5-fold-in-2017 study_89173.html. The InMobi report indicates high growth of video content through mobile programmatic advertising has led to an acceleration of the process.

     

    The “Mobile Magic” is rewriting the script of media planning strategies in India and we may be witnessing major disruptions sooner than predicted by EY in the FICCI ME Industry 2018 Report. EY indicated (Digital Media – Page 42) that overall changes can be expected once programmatic advertising crosses 25% share of the advertising spend as Programmatic advertising then would put pressure on advertising rates which in turn might put pressure on advertising led models.

     

     

  • The audience showing a distinct preference for channels providing cricket commentary in Indic over cricket commentary in English, writes Indrani Seni

    Indrani Sen: The Reigning Regional Queens dethrones the English King

    By Indrani Sen

     

    English, the undisputed King of all languages for business and commercial transactions in India, seems to be fighting a losing battle when it comes to the language of communication and entertainment in India. It is estimated that only around 10% of our total population speaks in English, though we are supposed to be the world’s second-largest English-speaking country. Recently, research after research has been showing the hunger for content in Indic among the Indian audience.

     

    IRS 2017 published earlier this year showed us that from 2014 to 2017 most of the regional languages dailies have grown more than the growth of English dailies. Except Times of India, all the newspapers featuring in the list of Top 20 newspapers in India were regional newspapers in vernaculars.

     

    Film and television in India have been thriving on Indic content for many decades. Regional TV channels in different languages have been delivering much better than National Hindi channels in their respective markets.  FM radio stations rely heavily on content in Indic and interact with their listeners in their mother tongues which are getting them rich dividends, both in terms of audience and advertising revenue.

     

    New media is also trending in the same way. ‘Internet in India 2017’, published jointly by the Internet and Mobile Association of India (IAMAI) and Kantar IMRB in March 2018, estimated that there are 205 million internet non-users who are likely to embrace internet if the service is provided in a language of their choice. According to the report usage of Indic in Urban India is strictly restricted to various forms of infotainment like news, music/ video streaming and other forms of entertainment, the average of all such activities work out as70% of total usage of internet in Indic.On the other hand, critical services like online banking, job search or ticket booking still reflects very low local content usage (less than 20%). The survey reveals that internet in Indic, not just content but the entire digital ecosystemwill be a key factor for achieving the dream of a “Digital India”.

     

    Media groups are using different strategies to encash the growth opportunities in the regional markets; the latest strategic move by Star TV is to broadcast cricket commentary Vivo IPL for in four regional languages, Tamil, Telegu, Kannada and Bengali apart from English and Hindi.  Star India announced in December 2017 its telecast plan for IPL 2018 covering six languages, 10 channels and live streaming on Hotstar service. In 2017, the cumulative reach of IPL 10 on Hotstar for the months of April and May across the 60 matches played was 130 million while the reach on TV was 410 million. In 2018, Star India is aiming to reach over 700 million people and they are relying on cricket commentary in Indic to achieve that target.

     

    The latest announcement of the agreement between Prasar Bharati and Star India, allowing a 60minute delayed broadcast over DD channels and equal sharing of advertising revenue generated by Doordarshan, will ensure maximise viewership of cricket commentary in Hindi, particularly if the feed is also available for DD’S free Dish TV users. It is not clear if Star India will share the cricket commentary in the other four regional languages with DD.

     

    Jaideep Vaidya, Desk Editor, Sports, Scroll In,published an interesting analysis in last February (https://scroll.in/field/869789/how-hindi-and-tamil-are-taking-over-cricket-commentary-in-india) where he analysed BARC data to show that viewership of Star Sports 1 in Hindi was much higher than the viewership of Star Sports in English for the India vs. Australia ODIs and T20s during the period September16  to October 13 last year.  Vaidya also showed a comparison of viewership between Sony 10 3 (Hindi) and Sony 10 1 (Tamil) for the India vs. South Africa Tests during the period January 6 to 26 this year to highlight the neck to neck race between the impressions in millions between the two languages.

     

    So, the last bastion of English broadcast content i.e. cricket commentary in English, is also crumbling before the onslaught of the regional language commentaries. It appears we are developing an indigenous style of cricket commentary in vernaculars mixed with “desi” humours and filmy dialogues which is different from the straight jacketed professional cricket commentary in English. Whatever is the style; the audience is lapping it up and showing distinct preference for channels providing cricket commentary in Indic over cricket commentary in English.

     

     

  • We will witness OOH becoming an integral part of social and mobile strategies within next few years, writes Indrani Sen

    Are we shortchanging OOH media projections?

     

    By Indrani Sen

     

    The FICCI EY 2018 Report on Indian M&E Industry paints a bright prospect for the OOH sector by commenting that “There is a clear shift toward digital OOH which is expected to be the growth driver for the industry.” It mentions about applications of AR and VR technologies and other DOOH applications, integration of OOH with activations, creation of immersive experiences through sponsorships of lounges, etc which will help in the future growth of outdoor. The government initiative for expansion of infrastructure by adding airports and MRTS (Mass Rapid Transport System) across the country is also supposed to boost the growth of OOH in general and Digital OOH in particular. The fact that the “Railways getting into the act” with their offer of increased opportunities for commercialisation of railway properties and services will also tilt the scale in favour of OOH industry.

     

    However, the OOH Industry size shown in the report does not reflect the above prophecies for the OOH sector. On the contrary, the report shows a static/diminishing year-on-year growth rate of OOH media and similarly a static/ diminishing share in the M&E Industry.

     

     

    OOH Industry Size & Projected Growth
    CY 2016 CY 2017 CY2018E CY2019* CY2020E CAGR2016-2020
    INR Billion
    OOH Media 31.6 34.3 37.1 40 43
    Growth Rate 8.40% 8.50% 8.16% 8% 7% 7.70%
    ME Industry 1308 1473 1660 NA 2032 11.60%
    Share of OOH Media in ME Industry 2.40% 2.30% 2.20% NA 2.10%

    Source: FICCI-EY 2018 Report, page 11*Estimated by writer

     

    As per the Pitch Madison Advertising Report 2018, OOH market grew by 6% to reach Rs3085 crores in 2017 with a contribution of 5.8% to the total Advertising Adex.In 2018 it is expected to grow by 10% to reach Rs 3395 crore with a contribution of 5.7% to the advertising pie. The increase in the growth rate in 2018 is based on the upcoming eight State Assembly Elections in 2018 as well as Central Government publicity as a build up to the general Election in 2019. PMAO does not mention about the other opportunities related to growth of infrastructure, etc. There is one common thread between the two reports: the contribution of OOH to the total advertising pie has been hovering around 6% over the years (2013 to 2018E) according to the estimates of PMAO. Admittedly, the percentage shares are different as the two reports deal with different definition of the universe.

     

    What is the future of the OOH sector in India? Is it really poised for an advertising leap based on the coming of age of our millennial population, increased penetration of mobile and social media and availability of digital technologies? I read an interesting article about a year back on “Top 5 Emerging Technologies of Outdoor Advertising in India -207” (https://www.posterstalk.com/Blog/Post/technologies-of-outdoor-advertising-in-india) which described Digital Billboards, Digital Signage, Geo-fencing Technology,  Beacons and Near Field Communication (NFC) as the five emerging trends in Outdoor advertising which we can expect to become realities as we progress to the next decade.

     

    It may take a few more years before we see applications of Geo-fencing Technology, Beacons and Near Field Communications in India. But, Digital Billboards and Digital Signage are both poised for immediate growth with huge opportunities of development across our airports, railway stations, MRTS systems and malls, multiplexes, theme parks, sports stadiums and other entertainment complexes. Hospitals and health centres can also benefit from digital signage. Our Ministry of Tourism along with The Archaeological Survey of India can also use this medium for promoting tourism and enabling the travellers with knowledge of world heritage sites and historical monuments.

     

    I strongly believe that we will witness OOH becoming an integral part of social and mobile strategies within next few years. Closer interaction and collaboration is required between the Social Marketing and Digital Marketing Agencies and the Outdoor Agencies for achieving this transformation which will benefit both the parties. Eventually, digital technology will transform OOH from a passive medium to a direct response medium and our media classifications will have to be re-written. While technological churning of the OOH industry takes place, media analysts have to ensure that their industry estimates do not short change the growth of the sector.

     

     

  • It will not be surprising if we see the entry of private Free DTH players in the strong regional markets in near future, writes Indrani Sen

    To be or not to be… on DD Free Dish

     

    By Indrani Sen

     

    Over the last two weeks, we have seen various news reports about Prasar Bharati’s new, yet-to-be-proposed policy for Free Dish slot auction among private broadcasters.  A report in www.economictimes.indiatimes.com highlighted a reminder letter sent by the Ministry of Information & Broadcasting (MIB) to Prasar Bharati on the subject of reviewing  and recasting of their policy for auctioning of free slots on DD Free Dish TV  platform to private broadcasters in (https://economictimes.indiatimes.com/news/politics-and-nation/dont-subsidise-private-channels-review-free-dish-policy-ib-ministry-to-prasar-bharati/articleshow/63707567.cms ). The same report was carried by other websites and newspapers.

    According to the above report, the ministry officials said that from August 2017, PrasarBharati has not responded to any of the six reminders sent by the Ministry on the subject. The article quoted from the ministry’s letter “Recognising the limitation of the present arrangement it was suggested that these co-branded channels could be operated on a revenue share basis, this will ensure DD brand is not diluted and DD has a continuing stake in revenue growth…..This limitation should have been identified when the Free-Dish was thrown open to private channels.” In this connection, we can recall some interesting numbers.  PrasarBharati earned Rs 85.10 crore from the auctioning of 11 slots on DD Free Dish in July 2017. Prasar Bharati’s earnings from a single auction saw a phenomenal rise from Rs. 25 lakhs in its first auction to GEC channels in 2005 to Rs 85.10 crore in its last auction in 2017. Obviously, when the system of auctioning was introduced, neither the Ministry nor PrasarBharati had visualised the potential of The DD Free Dish platform.

    According tohttps://www.livemint.com/Politics/L1SzhVVx4ik3EO63ytq4WL/IB-ministry-suspends-auction-of-slots-on-DD-Free-Dish-to-r.html, Doordarshan earned more than 30% of its revenue from Free Dish at Rs 264.17 crore for the year 2016-17. It was the highest-ever revenue earned from the DD Free Dish platform. Overall, the broadcaster earned Rs 827.51 crore in the year 2016-17, surpassing its annual target of Rs 800 crore.

    Prasar Bharati cancelled the auction of slots on DD Free Dish scheduled in August 2017 citing administrative reasons. Subsequently we learned that I&B Ministry had asked the broadcaster to suspend e-auctioning of slots on DD Free Dish until further notice. TDSAT (Telecom Disputes Settlement and Arbitration Tribunal) had advised Prasar Bharati vide their order dated October 27, 2017 to carry out a comprehensive review of the policy of DD Free Dish. Meantime, private broadcasters whose contract expired were allowed to broadcast on DD Free Dish on a pro rata basis as per TDSAT order.

    We learnt recently that Prasar Bharati has told TDSAT that it will come out with a new policy for its free direct to home (DTH) DD Free Dish in a few weeks.“Following Prasar Bharati’s submission, the tribunal has posted the matter under the same head on 28 May” (http://www.televisionpost.com/prasar-bharati-to-come-out-with-new-policy-on-dd-free-dish-in-a-few-weeks/). The Prasar Bharati Board has appointed a Task Force for coming up with the new policy. Now the question is on what basis this new policy will be framed.

    An article on TOI, Pune on Saturday, April 21, 2018 quoted sources who said: “the government is keen to push a revenue sharing model, where private channels are asked to bid for DD Free Dish slots and also share a portion of their revenue with the public broadcaster.” We got a hint of this from Shashi ShekharVempati, CEO, Prasar Bharati who commented in the FICCI EY Report 2018 under Looking Beyond for Prasar Bharati:“Public broadcasters to move away from only government funded to self-sustained models, which mean: Platforms must be based on revenue sharing models …”

     

    Currently, Prasar Bharati does not have any clue regarding the number of subscribers accessing DD Free Dish across the country, let alone their distribution by states/ urban and rural, etc. The number of subscribers quoted by the Ministry as well as TRAI is based on market estimates by private organisations. As per TRAI, there were 66.99 million active pay DTH subscribers in 2017 apart from the subscribers to DD Free Dish which was estimated to be 22 million. The private TV channels are available through the paid Dish TVs and cable operators and the TRPs earned by them come from a combination of all the distribution platforms. Naturally the advertising revenue earned by the TV channels is also based on the availability of the channels through all the distribution platforms.

     

    Source: http://www.trai.gov.in/sites/default/files/PIR_July_Sept_28122017.pdf

    In the current system of distribution, the TV channels pay a carriage fees/ placement cost to the DTH distributors/ cable operators based on how many subscribers they have. The DTH distributors/ cable operators also share a percentage of their subscription fees with the TV channels. The range of the carriage fees as well as the subscription fees varies widely based on the number of subscribers, the popularity of the TV channels as well as individual negotiations between the two parties.

    The TV channels agreed to pay for slots on DD Free Dish in lieu of carriage fees/ placement cost. Prasar Bharati had kept a reserve price of Rs 8 crore for non-news channels and Rs 6 crore for news channels. Several channels left the platform over last couple of years as they found the reserve price to be too high. A new model based on revenue sharing over and above the auction fees may turn away the private broadcasters from DD Free Dish when there is no scope of earning from subscription fees.

    Such a move may not be beneficial to Prasar Bharati as the FTA TV channels may choose to opt out from the platform of DD Free Dish. The rural TV viewers will be deprived of quality content and penetration of TV in rural areas may slow down. There is an untapped rural market across the country and our Government increased the FDI in the DTH sector from 49% to 74% in 2013 and to 100% in 2015. Therefore, it will not be surprising if we see the entry of private Free DTH players in the strong regional markets in near future. There is a high chance that if a new policy for allocating slots on DD Fee Dish based on revenue sharing is launched, it may boomerang and hamper the growth of the distribution platform.