Emerging Sectors in Ad spending

The year 2006 would not only be remembered for sky-rocketing property prices but also for the big ad moolah that was shelled out by realtors, making them the biggest advertisers on television and on print. Realtors edged out automobile brands and educational institutions in the race to emerge as the largest advertiser of 2006 with spends of around Rs 510 crore between January and November, a 60% growth over 2005.

Another emerging category, travel and tourism, registered the highest growth of 70%, a feat that propelled it into the top 10 league, according to media agency Mindshare Insight’s estimates. Cars and Jeeps vroomed with a 16% rise and occupied the number two slot. Educational institutions and two-wheelers were the third and fourth-largest advertisers respectively during the period, while independent retailers stood fifth in the pecking order with a 41% increase in ad bucks compared to 2005.

Real estate analysts attribute this surge in ad spends to IPO build-up of various companies. “With 350 malls coming up in the next two years, the retailers will have a choice of malls to locate themselves. So one will see a spate of ad campaigns by mall developers. Moreover, as real estate is emerging as a preferred asset class, developers are keen to enhance visibility to attract investors,” Knight Frank India chairman Pranay Vakil said.

Surprisingly, the FMCG sector, which used to take up a lion’s share of the ad spends, has only one entry in the top ten (toilet soaps), as shampoos and other categories saw sluggish spends. “Although, the FMCG sector recorded a positive growth last year, it was not able to match up with the growth in other buoyant sectors such as real estate, retail and telecom,” said Mindshare Insight national director Sanchayeeta Bhattacharya. Another trend that emerged in 2006 was the entry of branded jewellery segment in the top 20 rankings with a 40% increase in ad spends. Interestingly, despite the growth in travel and tourism, airlines have dropped out of the top 20 list. “Last year there were a larger number of airline IPOs. Also, as losses increased in the airline industry, ad spends got adversely impacted,” Bhattarcharya added.

Media planners say that as the Indian economy, increasingly, takes global cues, where retail and automobile sectors occupy the top most slots as the biggest ad spenders, India, too, is showing similar signs in the ad space as auto and retail gears up with more ad budgets. “Some categories which are obvious misses include financial advertising, which should have fared better considering the boom in the capital markets and an overall heathy economy,” said Lodestar Universal CEO Shashi Sinha.

Source : The Economic Times