The advertising industry is having a strong run in India and the proof of this is the growing advertising spend of one of its top categories — automobile industry.
However, the trend may not continue this year due to dip in sales volumes this year.
Reportedly, car sales in April 2019 dropped by 16.7 percent as compared to the same period last year, indicating a significant slowdown in the market.
According to data collected by Federation of Automobile Dealers Association (FADA), retail sales of cars and SUVs dipped two percent in April to 2.42 lakh units.
Factors like tight liquidity, high insurance costs, general elections, declining sales, raising commodity prices, unfavorable exchange rates, new government safety and emission regulations are applying immense pressure on the industry.
But until March this year, the auto sector had been spending considerably on advertising. And across print, television and radio, Maruti Suzuki was reported as the top advertiser for the first three months of 2019. The company’s spend on advertising was most on radio followed by digital, print and television.
Mahindra and Mahindra, the second company on the list of top advertisers, spent more on television, digital and print.
According to an AdEx report, a division of TAM Media research, traditional mediums like television, print and radio saw growth in ad volumes of cars by 17 percent, 15 percent and 7 percent respectively between January and March 2019 as against the same period last year.
This year, among the three mediums, television tops the chart with 58 percent in terms of ad insertions followed by radio at 37 percent and print at 5 percent.
In terms of television programming, news bulletins turned out to be the most preferred genre in 2019 as it captured 32 percent share followed by feature films with 22 percent share.
North zone topped the charts in terms of regions for the print category with a contribution of 34 percent of ad spend. New Delhi was the highest not only in North Zone but in overall India.
Region-wise for radio, Maharashtra recorded the highest spend. The state was on top with 19 percent share of category advertising, followed by Gujarat with 18 percent share.
Last year, auto remained one of the top categories to fuel the growth in advertising spend for television, said the 2019 Pitch Madison report.
Television saw highest growth in 2018 in the last three years, courtesy fast-moving consumer goods (FMCG) and auto.
The report further noted that nearly 75 percent of print’s growth of Rs 820 crore in 2018 was accounted for by top five categories including auto.
In terms of category contribution, FMCG and auto were the largest contributors to the print pie, with a contribution of 14 percent.
The media and advertising industry is on a high growth path and the Pitch Madison report expects the ad market to grow by 16.4 percent, adding Rs 9,980 crore to Adex, taking it to an all-time high of Rs 70,888 crore in 2019.
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