Industry POV

Elections spur outdoor industry out of demonetisation blues

08 Mar 2017

After the note ban, the outdoor industry was hit by as much as 30-35 per cent. But in states where elections were held, the industry has got a 7-10 per cent boost, say industry veterans

Elections recently took place in four states and a few more are yet to happen. Political parties have marketed themselves well and it is seems they have well planned their media this time. Outdoor media, which plays an important part during such times, has seen a good growth across respective states.

The growth comes after the industry went through a slump of as much as 30-35 per cent in the last two months of 2016, post demonetisation. States where the elections took place witnessed a 7-10 per cent boost after subtracting the demonetisation effect, say industry veterans. spoke to top names to know how elections affected the industry.

Seeing the overall industry growth, Posterscope’s President, Fabian Cowan, thinks that the out-of-home (OOH) industry has grown approximately by 9 per cent in 2016 over the previous year and the outlook for 2017 looks bright as well.

“Like all other mediums, OOH too could not insulate itself from the ills of demonetisation and the effects were visible in the latter part of the year. The good news is that the worst is behind and the next few months could see some active usage of the medium by brand marketers.”

Mandeep Malhotra, Founding Partner and CEO, The Social Street, said elections come as a boost for OOH, radio and digital media, which are hyper-local mediums and help in the overall incremental growth of business. He said, “The outdoor business cannot work on credit and there is huge insecurity when it comes to working with politicians and their campaigns. In the states where elections took place, they witnessed about 30-35 per cent growth.”

He added, “Demonetisation had brought down the industry by 40 per cent in November and December. The elections definitely impacted the outdoor industry, giving an overall 7-10 per cent boost in the states where elections happened.”

A lot of cash transactions happen during elections and outdoor media agencies are not willing to take up work that involves cash. Also, they may not necessarily get their dues on time. But the good part is elections definitely give a boost to outdoor as campaigns are seen at all possible legal and illegal spots. While media agencies may not benefit, media owners end up benefitting, eventually boosting the industry.

Sanjay Shukla, President, DDB MudraMax, says that while demonetisation affected the industry, elections may not have done that well for the agencies as much as it did for media owners. He expects April to be a better month for the industry at large.

While most of the outdoor media agencies did not work on political campaigns, Madison OOH worked for BJP in Mumbai. Soumitra Bhattacharyya, CEO, Madison OOH, said, “Primarily the elections were done directly by the media owners. As an agency we managed BJP’s main line media mandate and we did an outdoor campaign for them in Mumbai.”

While election campaigns involve big spending and they do increase media consumption during that period, Bhattacharyya says that it is difficult to peg a growth figure. On the other hand, Cowan thinks the elections have in a way conditioned the outdoor medium to accept the presence of this category and it was no different this year too.

He added, “The outdoor sector has seen an increased demand within the current election-heavy environment, which in turn has led to shortage in inventory for corporate players. Since most cities have banned posters stuck on walls, billboard remains the only viable option, which not only is cost effective but also promises reach.”

Posterscope has made an observation that political parties have taken a strategic approach to outdoor advertising. They have moved from performance tracking of advertisements to a more targeted approach towards hoarding placements and this shift in the mindset is a welcome change.

Cowan says that this one was of the hardest fought elections in recent times, especially after the impact of demonetisation. He said, “Whatever the case may be, it emerges that all parties used the medium, adding in sensibility and a planned approach. Our vote goes to all parties for that for sure.”

According to Shukla, “States that were into elections witnessed a good growth in outdoor advertising. UP and Punjab witnessed a growth as high as 80 per cent.”