MxMIndia

Tag: Madison World

  • BMB India is the advertising unit of Madison World, a diversified communication group

    BMB wins 2 Hamilton brands – Treo And Milton

    By A Correspondent

     

    BMB India, a 50:50 JV between Trevor Beattie’s BMB and Madison World has won the Hamilton account. Prabha Prabhu, CEO, BMB India said: “We pitched for one, but won 2 brands of Hamilton Houseware P Ltd – Milton and Treo. In June, when I had the creative team in place with Raj Nair as the creative head, I decided to contact our old client Hamilton. We made a Strategy and Creative presentation for the brand Treo Glassware. Work for the 2 brands will start immediately since both the brands become very active during the festive season. I am glad to be associated with Milton once again.” Both Milton and Treo are the flagship brands of Hamilton Houseware Pvt Ltd.

     

    This win comes hot on the heels of the recent account win of Leapfrog Holidays. BMB India is the advertising unit of Madison World, a diversified communication group with 22 units across 9 specialized functions of Advertising, Media, PR, Out-of-Home, Rural, Retail, Entertainment, Mobile, Events and Sports; employing over 900 communication professionals across cities in India, Sri Lanka and Thailand.

     

     

  • This does away with the practice of advertisers having to pay on the basis of projected box office collections of a movie

    PVR explores charging ads less for flops

    By Ratna Bhushan

     

    Multiplex operator PVR plans to link its advertising rates to ticket sales to make its cinemas more attractive to advertisers.

     

    PVR has approached advertisers such as Hindustan Unilever, Bharti Airtel and Hero Group with a first-time concept of charging for advertising at the start and during the interval on the basis of the number of tickets sold, a top PVR executive said.

     

    This does away with the practice of advertisers having to pay on the basis of projected box office collections of a movie.

     

    “There’s a captive audience, no remote control and least amount of spill over. Most of all, it’s completely validated because we can’t over-state ticket sales,” said PVR COO Gautam Dutta.

     

    The concept means advertisers can fix the reach and duration for which they pay to advertise. So, for example, if Agent Vinod flopped, advertisers would have the option of pulling out midway, and instead put their money on another flick-say, Kahaani.

     

    The bulk deal they would have committed to PVR gets carried forward to the next movie.

     

    Media-buying houses, which have been rooting for higher accountability on television ad spends, are keen on the new concept.

     

    “This could be a significant step towards making cinema advertising more accountable. Though small compared to television, it at least guarantees returns on investment,” said Basabdutta Chowdhury, CEO of Platinum Media, a division of media buying group Madison World, which buys media for Bharti Airtel.

     

    Ajit Varghese, MD, South Asia of Group M-promoted media buying firm Maxus, which buys on behalf of Hero Group, says: “Cost per audience is always a better measure in cinema advertising. It’s an ideal way of moving ahead, as long as it is implemented well.”

     

    The cost of in-theatre advertising works out about eight times cheaper than mass media, say media buyers. Theatre operators are allowed 18 minutes of advertising per movie screening.

     

    The buys can be segmented for consumers in tier II cities – at PVR Talkies, or at the high-end PVR Premiere, or at the luxury cinema Director’s Cut.

     

    Mr Dutta says the rates are flexible and would vary: “If Hero wants to advertise in our theatre in Baroda, rates will obviously be lower. If they want to buy screen time on theatres in Juhu in Mumbai, we will charge more.”

     

    PVR operates 179 screens across 24 cities. The move targets 28 m viewers in a year across PVR screens.

     

    Below-the-line advertising and promotions are common for most cinema and multiplex players. India’s largest carmaker Maruti, for example, had used sound technology to promote the launch of its new Zen model, while toothpaste brand Close Up had run a promotion where seats were sold only for couples.

     

    In 2011-12, cinema advertising contributed 13.5 per cent, or Rs61 crore, to PVR’s revenue of Rs492 crore. The company is projecting Rs85 crore in advertising revenue this fiscal. The concept could catch up among rival multiplex players as well.

     

    Source: The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

     

  • They say that TRPs should decide the ad rates of reality shows instead of the channels charging advertisers fixed rates even before the show goes live

    Advertisers crib as TRPs fall for Satyamev Jayate

    By Ratna Bhushan

     

    The truth isn’t quite triumphing – not at least in the way some advertisers on Aamir Khan’s hyped debut television reality show Satyamev Jayate thought it would. Television rating points (TRPs) have fallen short of expectations, say at least two marketing heads of associate sponsors, although publicly most advertisers are making the right noises. That, however, hasn’t stopped media buying firms, on behalf of advertisers, from pushing for result and performance-based ad rates on reality shows. They say that TRPs should decide the ad rates of reality shows instead of the channels charging advertisers fixed rates even before the show goes live.

     

    As per rating agency TAM’s data released by Star on June 13, Satyamev Jayate – which is being aired on Sunday mornings across nine channels of the Star Network (as well as on the state-owned Doordarshan) delivered a national TVR of 3.9. That’s lower than the ratings of blockbuster shows of the past like Kaun Banega Crorepati (Sony Entertainment) and Bigg Boss’ debut show (Colors).

     

    Navin Khemka, managing partner of media buying firm ZenithOptimedia, which represents consumer goods major Reckitt Benckiser, one of the associate sponsors of Satyamev Jayate said: “All the risk cannot be passed on to the advertiser. With high entry-level costs on reality shows, it is critical that channels take more accountability on the returns on investment.”

     

    Increasingly, agencies and clients will ask for certain minimum guarantees on programme performance and viewership, he added: “It has to be a win-win for both the brand and the show.”

     

    While Bharti Airtel coughed up a chunky Rs17-20 crore for the presenting sponsor slot, associate sponsors like Axis Bank, Reckitt Benckiser, Skoda, Coca-Cola and Johnson & Johnson paid Rs6-7 crore each for the 13-week show.

     

    Star has charged Rs8-10 lakh per 10 seconds for spot rates for Satyamev Jayate while spot rates for KBC were Rs 3.5-4 lakh per 10 seconds.

     

    According to the marketing head of an associate sponsor who did not wish to be quoted, returns on investment on the show could have been higher. “The way the show was sold to us, we expected higher ratings. It’s disappointing and we hope the ratings increase as the show progresses.”

     

    However, Bharat Bambawale, global brand director at Bharti Airtel, defended the investment: “To view the success of a show based only on television ratings would limit its overall value. The success of a show has to be looked at collectively and in a holistic way… the content of a show will impact ratings.” On whether broadcasters should rationalise ad rates on reality shows, Bambawale said: “It’s a matter of individual judgement for every sponsor.”

     

    Basabdutta Chowdhury, CEO of Platinum Media, a division of media buying firm Madison World, which buys media for Bharti Airtel, said: “Advertisers do want accountability and minimum guarantees factored in for reality shows in general, although Satyamev Jayate was not meant to be a mass ratings show.”

     

    On reality shows, deals are structured in a way that they cannot be re-negotiated through the entire program. This is unlike cricket where broadcasters keep at least some ad inventory – like the semi-finals and finals – open to negotiations based on the ratings.

     

    Ajit Varghese, MD, South Asia of Maxus, which is owned by the country’s largest media buying house Group M, said: “While there’s no standardised way of looking at a deal, we all are pushing for deals with a minimum guarantee. Of course, the arrangement should factor in an upside too, but overall ad deals should be linked to a programme’s performance.”

     

    Veteran ad man Santosh Desai is of the view that Satyamev Jayate needs to be evaluated not just by viewership but also for the impact it has. “It’s a difficult show to watch…. Some subjects don’t have a mass audience at all so to be watched week after week by masses will be a challenge.” KBC’s most recent season had opened to a rating of 5.24, and Bigg Boss Season 5 had opened to a TRP of 4.25. The Amitabh Bachchan-hosted KBC had managed ratings of over 4 all through its run.

     

    A Star India spokesperson says the show has delivered a reach of Rs40 crore over the first five episodes (including repeats). The launch episode delivered a TVR of 4.9 in Hindi-speaking markets and a 4.1 TVR all-India. Subsequently, all episodes have consistently delivered a 4+ rating in HSM and 3.5+ ratings at the all-India level.

     

    Kevin Vaz, Star India president, ad sales said: “Satyamev has ranked amongst the top few every week on an all-India level.”

     

     

    Source: The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

     

  • The economics for a franchise are simple. Every franchise incurs two kinds of costs, and both are essentially of a fixed nature: the licence fee and player costs

    Where the economics stand for 4 key stakeholders post IPL’s fifth season

    By Ravi Teja Sharma

     

    Beyond the brawls and the bustups, there was cricket. And business, which became steadier and better. As millions continued to watch the cricket, IPL 5 strengthened the league’s business credentials.

     

    Franchises

    Their costs are mostly fixed and they are squeezing more out of each revenue stream. In the humdrum of IPL3, the operative word was ‘valuation’. The then-IPL chief Lalit Modi proudly announced two new franchises, Kochi at $333 million and Pune at $370 million.

     

    In other words, Pune’s owner, the Sahara group, was paying 3.3 times the priciest original franchise (Mumbai, $112 million), setting a new benchmark for valuing a team.

     

    More insanity followed: Modi was dismissed by a tweet, Kochi imploded, and Sahara had second thoughts about its $370 million investment. Sanity returned in season five. “Initially, it was more about valuations, not viability,” said Venky Mysore, CEO of the Kolkata team. More than any other season, IPL 5 has been about viability.

     

    Not of the surviving kind, but of the thriving kind. “For the first time, most of the franchises will be financially better off,” said IPL commissioner Rajeev Shukla.

     

    “Many have become profitable after IPL 5.” Like Kolkata. “We reduced our combined losses by about 50 per cent in IPL 4,” said Mr Mysore. “This year was equally good or better than last year…we should wipe out the remaining losses.” Chennai and Delhi say they have been profitable since season three, and that this year was better.

     

    The economics for a franchise are simple. Every franchise incurs two kinds of costs, and both are essentially of a fixed nature: the licence fee and player costs.

     

    For a metro franchise, the licence fee is around Rs35 crore a year, while the player cost is Rs55 crore. Add sundry expenses, and a franchise is looking at total costs of Rs100-120 crore. On the revenue side, there are essentially three revenue streams.

     

    The biggest revenue contributor is the ‘central pool’. All the money the BCCI raises by selling broadcasting rights and sponsorship goes into a common pool. The BCCI keeps part of this and distributes the rest among teams.

     

    With the BCCI negotiating hard with the broadcaster and sponsors, each franchise’s share of the central pool has steadily increased-from Rs29 crore in season one to Rs40 crore in season four.

     

    “The central payout will increase to Rs 50-60 crore this year,” said Mr Shukla. The franchises have no control over the central pool. They do have control over the other two main revenue streams: ticket sales and sponsorships, from where the good franchises raised, on an average, Rs30 crore and Rs30-40 crore, respectively.

     

    In both these areas, IPL-V saw the franchises, with one eye on growth and another on the bottom line, pushing new levers. Teams say they increased ticket prices and reduced the number of passes, and consequently made more.

     

    “Gate collections in season five would have doubled compared to earlier years,” said Rakesh Singh, joint president, India Cements, the South-based cement company that owns the team, without giving specific numbers.

     

    Amrit Mathur, CEO of the Delhi team, too declined to share numbers, but described ticket sales as “phenomenal”. “We limited passes only to our contractual agreements,” he said. What teams did more was to reach out to the paying fan.

     

    Kolkata, for example, had 10 cars going around the city and doubling up as ticket counters. The team also did corporate sales to fill up the 80,000-seater Eden Gardens.

     

    For next year, it is looking to convert some of those seats into hospitality boxes, whose revenue potential is 20 per cent more. Teams earned more from sponsors too by selling advertising on 10 designated spots on a player’s uniform.

     

    “We expect it (sponsorship revenues) to be 50-75 per cent higher than year one,” said Mr Mathur. Chennai’s strategy was to cut back on sponsors. “We wanted to clear the clutter and charge more instead,” said Mr Singh of the Chennai team, whose sponsors include Aircel, Gulf, LifeOK, Amrapali and Usha.

     

    Some other nascent revenue streams are gaining ground, like merchandising. “About 10-12 per cent of our revenues this year came from licensing and merchandising,” said Colonel Arvinder Singh, COO of the Punjab team. And the Delhi Daredevils is looking to lend its name to sports bars, the first of which has come up at the Delhi airport.

     

    For teams owned by corporates, in addition to a tangible payback, there’s also an intangible one for the main business. For example, all the branding on the Bangalore players is from the liquor and airline brands owned by team owner Vijay Mallya.

     

    “That has been our main priority,” said Russell Adams, vice president-commercial operations for the Bangalore team. Similarly, India Cements has used IPL to drive into markets other than the South.

     

    Besides the visibility from player jerseys, it has been wooing cement traders in cities in Gujarat, Madhya Pradesh and Rajasthan with a package of an IPL match in Chennai and a pilgrimage to Tirupati.

     

    “This was a masterstroke for us: to enter a market dominated by biggies like Ultratech,” said Mr Singh. It all contributed towards viability-of the long-term kind. And valuations, today, stand forgotten.

     

    Broadcaster

    Viewership addition tapered, but it’s still a critical mass watching. There’s pressure on two of the numbers that matter for SET Max. According to TAM, which tracks TV viewership, the number of people who tuned into IPL grew just 0.4 per cent this year, against 12.9-19.8 per cent in the previous ones. And they watched less.

     

    If they saw 4.5 per cent of all the minutes they could have in the first three years, they saw 3.5 per cent in 2012, the same as in 2011. Or, a TVR (television viewership rating) of 3.5 per cent. That said, even a TVR of 3.5 per cent is top draw, more so if it comes with a reach of 162.9 million.

     

    “No programme will give the pan-India reach that IPL does for two months,” said Nandini Dias, COO of media-buying house Lodestar Universal. It is why, she added, SET Max commands a 60-70 per cent premium in pricing over another programme with an identical TVR.

     

    This year, SET Max charged Rs5 lakh per 10 seconds, the same as in 2011 and 150 per cent more than in 2008. “Ratings fell, but we did not drop our price,” said Rohit Gupta, president of Multi Screen Media, which runs SET Max. Mr Gupta declined to disclose revenues, though he admits it is “lower than 2011”.

     

    A senior official from the channel, not wanting to be named, said revenues from IPL-IV crossed Rs1,000 crore, against Rs800 crore in IPL 3and Rs260 crore in IPL 1. SET Max’s original deal, struck in 2008, was for $1.02 billion (about Rs 4,000 crore) for 10 years.

     

    This was revised in 2009 to $1.64 billion (Rs 6,560 crore) for nine years. When the number of matches increased from 60 to 74, in 2010, this number increased further, said Mr Gupta, on a “pro-rata basis”. Back-of-the-envelope calculations show the current deal would be for about Rs 8,000 crore and that SET Max needs an average of Rs 1,050 crore a year over the remaining five years to break even.

     

    “IPL has become a brand that is big enough to sustain for many more years,” said Piyush Pandey, executive chairman of Ogilvy & Mather India. Added Ms Dias: “If IPL remains in the top five programmes through the coming year, it could still command its 60-70 per cent premium.”

     

    The other broadcaster, Times Internet, which owns the rights for international broadcast, Internet, mobile and valueadded services, and radio, expects to break even this year. According to CEO Rishi Khiani, Times Internet is paying Rs 67 crore a year to BCCI.

     

    It reached 26 million viewers this year-an increase of 55 per cent over 2011. “If you sell it right, there is an opportunity,” said Mr Khiani.

     

    Sponsors

    They got their bang, in different ways. For more, they will likely have to pay higher. IPL’s main sponsors only have good things to say about their pricey tie up. The established talk about reaching a wider audience.

     

    “We were well-known in the north, but now have spread awareness in other parts as well,” said Rajeev Talwar, group ED at DLF, which paid Rs 40 crore a year for the title sponsorship. The fledgling talk about IPL as the main piece of their brand strategy.

     

    Karbonn Mobiles started in 2009 and tied up with IPL in 2010. Sashin Devsare, ED, said IPL put Karbonn “in the consideration set of a mobile buyer.” Likewise, Volkswagen, which came to India in 2007.

     

    “We needed to raise brand awareness,” said Lutz Kothe, head of marketing and PR, Volkswagen Passenger Cars. “All these sponsors would have got five times worth exposure for every rupee spent,” said Hiren Pandit, managing partner with media-buying agency Group M.

     

    “But over a period of time, that exposure becomes a blind spot if there is no other engagement.” For example, Vodafone used ad campaigns to push specific business ideas: ‘happy to help’ in 2008, the Zoozoos in 2009 and 2010, 3G in 2011, and Internet services this year.

     

    In contrast, DLF was content being the title sponsor and having an on-ground presence. All sponsorship deals are due for renewal.

     

    “Most were done on an anticipated performance of the league,” said Basabdutta Chowdhury, CEO of Platinum Media, a unit of Madison World. “Now that it has a proven record, BCCI would be looking at higher value.” The season of BCCI hardball is beginning.

     

    Promoter

    BCCI’s golden goose is IPL and it is making it work overtime. Just how important the IPL is to the entity that runs cricket in India can be gauged from one statistic. In 2010-11, the IPL accounted for 48 per cent of the revenues of the Board of Control for Cricket in India (BCCI).

     

    Add revenues from the Champions League Twenty20, which owes its existence to the IPL, the figure shoots up to 60 per cent. IPL is BCCI’s golden goose, and the board is making it lay as many eggs as it can.

     

    This means birthing new revenues streams by adding more dates to a packed cricketing calendar or earning more from existing streams by negotiating hard with those who want a piece of the IPL. Both have yielded smart financial payoffs for the BCCI.

     

    Thus, in 2009, was born the Champions League, which essentially gives the BCCI and the top four IPL finishers a revenue kicker. The same year, BCCI renegotiated the TV deal with Set MAX and squeezed out 78 per cent more.

     

    In 2011, it added two teams to the IPL (one has since folded) at a valuation that was about thrice the maximum from the initial lot in 2008. Overall, the number of matches increased, which translated to higher TV and sponsorship revenues.

     

    The BCCI earned more. So did the franchisees, as the BCCI shares some part of its broadcast and sponsorship revenues with them. BCCI’s ‘surplus’-the equivalent of a corporate net profit-has increased from Rs 11.6 crore in 2008 to Rs 118.8 crore in 2010.

     

    Numbers for the last two years are not available, though the BCCI had forecast a surplus of Rs 209.9 crore for season four.

     

    “BCCI revenues have gone up,” is all that Rajeev Shukla, commissioner of IPL and vice-president of BCCI, is willing to disclose. Revenues could increase further as all sponsorship deals are due for renewal now. And even as it says it will address scheduling concerns, the BCCI has allowed all franchisees to play three T20 matches with teams from tier-II cricketing nations like Canada, the US, Netherlands and Ireland.

     

    “This will spread awareness about IPL and improve the league’s reach next season,” said Mr Shukla. And also improve the BCCI’s financial health.

     

    Source: The Economic Times
    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

     

  • The account, previously handled by Lintas Media Group, will be handled out of Madison’s Bangalore office

    Madison Media wins Enamor media AOR

    By A Correspondent

     

    Madison Media Omega has just announced that they have won the media AOR for Gokaldas Intimatewear P Ltd, makers of Madison Media Omega media AOR Gokaldas Intimatewear P Ltd Madison World Enamor lingerie. The account was won in a multi-agency pitch. The agencies that participated in the Pitch were Maxus, OMD and RK Swamy Media. The account, previously handled by Lintas Media Group, will be handled out ofMadison’sBangaloreoffice.

     

    Mr Sam Balsara, Chairman & Managing Director, Madison World said: “We are delighted that Enamor has chosen us and are confident that we will be able to add a lot of value to their business. We are also happy to add a new product category to our portfolio.”

     

    Madison Media was recently in the news for winning the Crompton Greaves and Dixcy Textile’s Media AOR.

     

    At the recent Goafest 2012 awards Madison Media won 4 awards, including a Gold for Best Use of Newspapers & Magazines for Parachute Advansed Ayurvedic Hair Oil; 2 Silvers for Best Use of Internet & Digital Media for Airtel and Best Use of Branded Content for Cadbury and a Bronze for Best Use of Events and Stunts for Cadbury Celebrations.

     

    Madison Media Group is India’s foremost media agency handling media planning and buying for blue chip clients including Airtel, Godrej, Cadbury, ITC, General Motors, Marico, McDonald’s TVS, Britannia, Procter & Gamble, Asian Paints, Tata Tea, Shriram Transport Finance, Levis, SpiceJet, Crompton Greaves, Axis Bank, Domino’s, Bharti Axa, MaxNewyork Life Insurance, Tata Salt, Acer, Dish TV, Times Television Network, Indian Oil, Dixcy Textiles and many others.  The gross billing of Madison Media is Rs. 3000 crores.

  • Madison chief Sam Balsara on his key focus areas as head of the Audit Bureau of Circulation

    Sam Balsara’s big plans for ABC

    By A Correspondent

    The Audit Bureau of Circulation (ABC) Council of Management for 2011-12 has been announced, and as expected Chairman and Managing Director of Madison World, Mr Sam Balsara, who was the bureau’s deputy chairman in the previous year, has been entrusted with the chairman’s responsibility.

    In a brief conversation with MXM India on his key focus area as the Chairman of the Bureau, Mr Balsara elucidated, “I would have a two-pronged focus. One, to convince the media planners, who do not realize circulation data’s value, about its significance. The second focus area is to make the Audit Bureau of Circulation a more valued body in the eyes of the Government and a few others.”

    There have been a few instances where publications have exactly not been delighted about the ABC rules. Would Mr Balsara also look at softening the rules? He responds with a strong No, adding, “Any audit organisation needs to have strict rules. If the rules are not stringent, and do not need to be followed – it is better not to have them at all. In the five years or so, ABC audit has had no, or very minimal, intervention in the publishers’ marketing plans.”

    As for the readership survey and the ABC working more closely now, considering that there would be only one readership survey, Mr Balsara says, “That will happen automatically, considering that 10 members of RSCI would be from ABC.

    Mr T Venkattram Reddy of Deccan Chronicle Holdings Ltd has been elected as the Deputy Chairman of the Bureau for the year, while Mr Shashidhar Sinha, Universal McCann Erickson (India) Pvt Ltd has been elected as Honorary Secretary and Madhukar Kamath, Mudra Communications Pvt Ltd is Honorary Treasurer.