Media: The endorsement story... - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Media: The endorsement story...

Sep 28, 2007

In an earlier article we had explained the key trends in television advertising in the first half of 2007. In this article we shall have a review of the advertisement volumes across the different genres of channels and programmes in CY 06.Ad volumes across channel genres
The different genres of television channels are Hindi general entertainment channels, Hindi movie channels, regional general entertainment channels, Hindi news channels, and English news channels. The major Hindi GEC channels are Star Plus, ZEE TV, Sony TV. Popular regional entertainment channels are SUN TV, Etc Punjabi.

The pie chart below shows the contribution of genre of channels in TV advertising (volume wise) in the year 2006.

Regional GECs on TV contributed 23% share of advertising in the year 2006. Hindi news channels contributed 13% share on TV. However, the revenue share of different genres of channels reveals an altogether different picture.

General entertainment channels have a maximum revenue share of 40% while southern regional channels have a share of 19%. Thus the ad volumes on the regional entertainment channels are higher but the ad rates per second are significantly lower than on Hindi general entertainment channels. However, the viewership and revenue share of the Hindi general entertainment channels is going down while that of niche and regional channels is going up. The rollout of CAS and DTH will lead to an increase in the proliferation of regional and particularly niche channels, as they will be able to garner subscription revenues to sustain their operations.

Ad volumes across program genres
News bulletin genre accounted for the maximum 18% share of ad volumes closely followed by feature films with 16% share on TV in the year 2006. India is one of the few countries in the world where news bulletins enjoy such high viewership and high ad rates. This is one of the key reasons for the proliferation of several Engish, Hindi and regional news channels. Infact, broadcasters are even launching city centric news channels to cash in on the same. TV Today has launched its Delhi-centric news channel.

However, the soaps that are telecast on prime time (between 8 p.m to 11 p.m.) enjoy high TRPs and higher ad rates. One-day cricket matches featuring India also command high ad rates. Recently music and reality shows have become very popular and are telecast on prime time enabling them to garner significant advertisement revenues.

The next diagram shows the program genres with the maximum growth in the year 2006 over 2005. All the top five program genres saw rise in ad volumes in 2006, with huge 90% increase registered in ad volumes of film songs compared to the previous year

We expect the buoyancy in advertisement revenues to continue in line with the buoyant growth in the Indian economy. The above analysis shows that news, movie channels and general entertainment channels, which have the right content, are likely to do well in the future. The high TRPs enjoyed by these channels will enable them to garner higher advertisement and subscription revenues. Niche channels do not enjoy such a high viewership and thus their advertisement revenues continue to languish. Consequently, niche channels would have to garner subscription revenues for their survival.

Equitymaster requests your view! Post a comment on "Media: The endorsement story...". Click here!


More Views on News

Sorry! There are no related views on news for this company/sector.

Most Popular

My Latest Stock Recommendation (Fast Profits Daily)

Oct 9, 2020

How I picked an exciting stock using trends from both the commodity and equity markets.

The 'Seedhi Baat, No Bakwaas' View on ITC (Profit Hunter)

Oct 12, 2020

Is ITC an investment or a speculation at current levels?

One of the Best Investment Opportunities in the Market Right Now (Fast Profits Daily)

Oct 16, 2020

The one sector that you should be looking at to make good profits.

The Inflection Point for Defence Stocks is Getting Closer (Profit Hunter)

Oct 9, 2020

Few Indian defence companies could use their engineering capabilities to eventually become global leaders.


Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms


Oct 22, 2020 03:36 PM