Corporate Advertising Budgets To Rise 30 Per Cent This Festive Season
NEW DELHI: With an eye on festive demand, corporates are gearing up to spend about 25-30 per cent more this year on advertising and firms selling consumer durables, electronics and automobiles are expected to take lead in the busy season that starts with Navratras, according to Assocham.
"Though the corporates are facing higher cost pressure due to high interest rates, rising raw material costs and wages, marketing expenses mainly through advertisements in television, newspapers and the social media have become unavoidable with the companies in the media sector becoming the main beneficiaries," said the industry body.
By increasing their ad spend by up to 30 per cent this festive season, the corporates are hoping for a commensurate rise in their sales that the consumer confidence will return with the new Modi government taking incremental measures to boost the economy, it added.
An Assocham survey feedback suggests that attractive discounts are expected from main players in the e-commerce space who have tied up with manufacturers of mobile handsets and other electronic gadgets.
In the brick and mortar model, the companies engaged in manufacture of TV sets, washing machines and microwave ovens will do some 'hard sell'.
"They will be required to go for a hard push since consumer durables and consumer goods sector have not been performing well, as was clear in the June IIP (Index of Industrial Production) numbers," said Assocham General Secretary D S Rawat.
At least 40 per cent of the corporates' advertisement budget is typically earmarked for busy season which coincides with advent of several festivals. The rural market also remains in focus, though the response this year may not be encouraging because of scanty rainfall, Assocham said.
While TV remains a preferred medium for FMCG, consumer durables and car and bike ads, the increasing penetration of the social media will also attract marketing and media planners.
"The social media is far more focussed when it comes to target audience. Besides, the age profile of those using social media is a big temptation for media spenders," Assocham said.
Moreover, nearly 69 per cent of the marketing heads said that companies perceive the festive season as the perfect time to advertise their products.