It is such a relief that TRAI has actually done the impossible of enforcing the 10+2. Now there will be fewer ads put on 'mute' by TV viewers. Channels de idiom to increase rates is not fully justified. The reduction in FCT will simply create better stickiness to programmes and ad breaks too. Besides, channel GRPs will only go up as had been practiced many times in the past two years by almost all major networks.
On one hand the distribution and subscription revenue is increasing and on the other they want to raise ad rates. Clients however cannot simply raise ad budgets just to accommodate this inflation. The options they have is to revisit the media mix: increase non-TV especially digital, cinema, print and radio. And also reopen the channel mix by flushing out unwarranted high CPRP and zero rating channels that were used more qualitatively so far. Hard calls and prioritisation will now be the mantra.
Innovation across media to create saliency and impact will become the watchword.
Finally:
- Some channels will die unable to gather ad revenues
- Some will get gobbled up by other channels
- Many more channels will be launched hoping to cumulate GRPs
In fact, one of my clients voiced his opinion that all digital, print and non-TV media groups should capitalise on the situation by dropping rates further to fuel increase in non-TV volumes.
Also read: Broadcasters announce ad rate hikes; media planners voice reservations
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