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Election manna
Why media companies are celebrating the election

Krishna Gopalan

Billy Joel must have never imagined his Grammy winner We didn’t start the fire would become an anthem in the 2014 Indian general election. But the 1989 cult hit, which has references to Marilyn Monroe, Charles de Gaulle, Ernest Hemingway and the H-bomb, among others, found its way to Uttar Pradesh last November. The Samajwadi Party released an earthier Hindi version Man se hai Mulayalam, irade loha hai for party boss Mulayam Singh Yadav’s birthday and now a 30-second version plays regularly on TV channels as part of SP’s election propaganda. That’s in addition to the 22-ad campaign and a digital book the party has lined up as part of its poll ammunition — it’s spending an estimated ₹30 crore on election advertising. Sounds like the annual A&M budget of a growing FMCG brand? Then consider the total ad spend by all political parties in the 16th general election: more than ₹1,500 crore spent in just a few months — advertising started in January and will end on May 10 (two days before the last day of polls). Of this, the bulk will go to television (35%) and print (30%), while outdoor ads and radio will get 10-15% of the budget and the remaining will go to digital campaigns.

That’s like manna from heaven for the Indian media, which has been bearing the brunt of the slowdown. 

Enjoy it while it lasts

These few weeks are probably the only time news will have the upper hand in television — not only will viewers be glued to news channels rather than channel surfing between soaps, sports and cinema, news channels can also milk the opportunity since they are not bound by the 12 minutes of advertising per hour rule that general entertainment channels (GECs) have to follow. So, broadcasters are charging advertisers a significant premium on advertising spots on regular days and as much as 10 times the regular rate on May 16, the day of counting. For example, Aaj Tak, which is charging an average of ₹5,000 for a 10-second spot, has jacked up rates to ₹1.75 lakh on May 16 for a similar spot. And with most political parties working with ad budgets that are double what they were in the last general election of 2009, you don’t hear too many grumbles over the revised rates.

The reason: while that sounds like a lot, news channels’ average ad rates of ₹4,000-5,000 for a 10-second spot pale in comparison with the ₹5-6 lakh paid by advertisers for a similar spot during the recently-concluded T20 World Cup. 

The impact on advertising revenue for all 389 news channels is likely to be significant. In 2013, television advertising in India stood at ₹13,600 crore, according to a Ficci-KPMG report, of which news channels brought in only ₹2,500 crore, while GECs accounted for over ₹6,500 crore. The total figure is expected to increase to ₹15,200 crore this year, mainly on the back of election advertising.

Though rising ad spend sounds like music to the media industry’s ears, players are understandably cautious. Says Ashok Venkatramani, CEO, Media Content and Communications Services (MCCS) India, the company that operates ABP News, “The fundamentals of the economy are still not good. If things don’t look up in the second half, this will be temporary relief.”


Still, most companies are not shying away from making the most of the situation. There has already been a 20-25% spike in advertising revenue, says Alok Agrawal, CEO, Zee Media, which runs channels such as Zee News and Zee Business. “Because of increasing viewer interest around the polls, not just regular clients but even first-time advertisers are spending more,” he explains. 

Zee has hiked advertising rates at least four to five times on counting day. Besides political parties, Zee’s advertising roster also includes names such as Hero MotoCorp, Idea Cellular and real estate firm Prateek Group, all of which are currently advertising on its news channels. The regular advertisers have locked in better rates (about ₹3,000 for a 10-second spot) compared with what one-off advertisers will end up paying.  

It’s not only big, pan-India players who are reaping the bounty. According to Ratikant Satpathy, vice-president, Odisha Television Network, which owns regional news channel OTV, there is a rush for inventory right now. “We are the largest news channel in Odisha and are charging political parties 25-30% more than what we charge normal advertisers,” he says. Rates on counting day will be significantly higher than normal, but local jewellers and even outside firms have shown interest. “We have got commitments from companies as far off as Coimbatore for May 16.”

Even in the intensely competitive Tamil Nadu market, where the Sun TV network is the leader, smaller players are going for the kill. For instance, a 10-second spot on Puthiya Thalaimurai TV, a news channel launched in August 2011, usually goes for ₹1,000-1,200. The rate on counting day will be at least three times that, but that hasn’t deterred local advertisers. “Historically, advertising on counting day had only brands targeted at males. Now we have names such as Udhayam dal, Medimix and Popular Appalam more than willing to pay a premium to be on air,” says Shankar B, CEO of Fourth Dimension, which handles the channel’s advertising sales.

But where TV channels are celebrating the election, print is taking a more prosaic approach. “The spurt in spending is positive but we realise it will not hold out,” says Amit Jaiswal, company secretary, Jagran Prakashan, publisher of Dainik Jagran. Jaiswal believes there will be only a 2-3% spurt in advertising revenue for publications such as his. The reason? “Political advertising does not allow us to take the normal DAVP [directorate of advertising and visual publicity, the nodal ad agency of the government] ads in line with the model code of conduct. To that extent, we have to bank on political advertising making good that loss of revenue,” says Jaiswal.

If newspapers have no reason to uncork the bubbly, FM radio firms aren’t complaining: most have hiked rates to make the most of the moment. For instance, Radio One, which runs stations in seven cities, has a prime time network rate of ₹7,200 for 10 seconds, a 20% hike over last year’s rates. News channels’ prime time rates, in comparison, can be as high as ₹20,000 for 10 seconds. Vineet Singh Hukmani, MD and CEO, Radio One, points out the other advantage of the medium. “It allows a party to break through the clutter and speak directly to the voter,” he says. Largely, the Congress and BJP are using FM radio to communicate with voters but the medium got a fillip after the Aam Aadmi Party used it extensively during the Delhi Assembly election. 

Outdoor campaigns have also picked up steam this time, with overall spend on the medium estimated at around ₹200 crore, more than twice what was spent in 2009. The Congress and BJP together account for ₹160 crore, say media sources, with over 250 hoardings in Mumbai alone. Alok Jalan, managing director, Laqshya Media Group, which is handling the BJP outdoor campaign in Mumbai, says the strategy for the BJP campaign in the city has been to use a media mix that will generate visibility for the party not just on the arterial roads but also in some of the more remote locations. “The creatives have also been customised — one-liners in local languages such as Marathi and Hindi are being used,” he adds. Interestingly, outdoor rates haven’t been hiked for the election, possibly because most political parties have long-term relationships with those in the business and can exercise greater influence on them. What’s changed is the scale of the exercise — instead of the odd hoarding welcoming a party bigwig or congratulating party workers or a festival greeting, now there’s no blank outdoor space available in any city. Hoardings have been used effectively for positioning the party for the target voting class. 

Voting with their wallet

How are advertisers — both political and regular — reacting to the hike in advertising rates? Political parties aren’t completely surprised about having to pay a premium to be on air, says Chirantan Chandran, senior principal partner (north & east), Dentsu Media India, which handles media activity for the Congress. “This is expected since political parties, unlike regional advertisers, are not there through the year. They appear once in five years,” he points out. Nor does it raise eyebrows that all transactions between parties and channels are on cash-and-carry basis — no credit lines here since there is always the fear of default, especially if the party loses the election. The parameters for determining the efficacy of political advertising is no different from that for any consumer brand. “It includes getting the right spot and cost per rating point for television, and making sure it gets a prominent position in publications,” Chandran adds. For the Congress, that means emphasising Hindi and regional news channels, while the BJP has used print more extensively in addition to advertising on English news channels. And both parties advertised in a small way in the T20 Cricket World Cup.

Among non-political circles, this time around, advertisers are split in two categories. Some have specific campaigns running around the elections, such as Hero MotoCorp’s launch of the HF Deluxe Eco, which is on the right of the youth to elect their leaders. Anil Dua, the company’s senior vice-president (sales and marketing), maintains that at a time when there is already high visibility around news programming, an election is an appropriate platform to reach out to the relevant target group. “Almost a third of India’s voters are under the age of 30. For us, this is an apt theme to communicate with the youth,” he says.

Idea Cellular, Hindustan Unilever and Tata Tea are also running election-related communication on television. Idea’s ‘ulloo banoing’ campaign, though, didn’t start off as an election special. According to Sashi Shankar, chief marketing officer, Idea Cellular, the company wanted to take its internet offering to the masses. “The agency, Lowe Lintas, came with the script and it just gelled with the election. But it wasn’t planned with the election in mind,” he says with a laugh. The campaign has a politician making promises, only to be reminded by a bunch of youngsters that he said the same thing five years ago, holding up a phone showing a video of an earlier campaign. Despite the relevance and perfect timing of the Idea ads, Shankar is in two minds about advertising on counting day. “We will need to seriously think before deciding to go on air on that day if it becomes too expensive,”he says.

If the Idea campaign was happenstance, Tata Tea ensured it extended its hugely successful seven-year-old Jaago re campaign to the polls. Its ad for the season ties in women’s safety with voting and reinforces the fact that women make up a decisive 49% of the electorate. “The campaign aims to unite women from all strata and make them realise the importance of voting,” says Amer Jaleel, national creative director, Lowe Lintas.

The other category of advertisers don’t have election campaigns but are weighing the benefits of being on air during the polls. Suzuki Motorcycle is a case in point. Atul Gupta, the company’s vice-president (sales and marketing), points out that there will be sustained viewership for six to eight hours on counting day. “It is an extremely good proposition for an advertiser and certainly not expensive compared with entertainment and sports,” he says. The only hitch he sees is that it will be “extremely difficult” for a brand to make an impact: commercial breaks during election coverage will make the viewer immediately surf channels or leave the room to attend to chores. So, instead of advertising on traditional media, he plans to take the digital route for now.

Despite such concerns, advertisers feel it still makes sense to advertise during elections and even on the D-day. “It will be a good media buy and not necessarily expensive if you think of the number of people watching it. This is an event as major as cricket,” says Wasim Basir, director (integrated marketing communications), Coca-Cola India. The company is already running its summer campaign for big brands such as Coca-Cola, Sprite and Thums Up on GECs and sports channels. “We have to decide how much [advertising on news channels during election] can contribute on an incremental basis. It surely is an option we will need to look at,” he says.

The ideal media mix right now would include GECs, sports and news channels, say media planners. Shashi Sinha, CEO, IPG Mediabrands India, which handles media activity for clients such as  Microsoft, Sony and Tata DoCoMo, thinks cricket brings in the reach, while news gives a brand visibility. “It is not a question of either-or. We have been telling our clients to go for both and they are showing interest,” he says.

For their part, when networks aren’t exhorting advertisers to book air time, they are doing their bit to persuade voters to head to polling stations. So you have Zee TV tweaking story lines of popular soaps to include election themes, Star Plus encouraging first-time voters to register themselves, and Zee News’ bringing back its 2009 Aapka vote aapki taqat communication. “We work with the Election Commission for this voter awareness campaign. We have been doing this for every general and assembly election,” says Zee’s Agrawal. Clearly, the election matters to broadcasters, in more ways than one.

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