The outbreak of COVID-19 has led to a 40 days long countrywide lockdown which has paused business in various sectors, including the advertising industry. There will be a significant impact to advertising due to this situation. We are certain that the Media and Advertising community will come together to assimilate its learnings from this anomalous situation and revive the industry for a brighter future.
MediaNews4U spoke to Aditya Bhat, Head – Jio Studios.
Post-Lockdown are you seeing a global recession?
While we are all aware of the demarcations, AD (Anno Domini) and BC (Before Christ), this pandemic, needless to say, has divided the world’s economy into a new set of phases- Before COVID-19 and After COVID-19. Looking at the current scenario, it is clear that an inevitable recession is about to weigh on the world and we all need to be prepared to deal with it in the best possible manner. How one reciprocates to this situation effectively remains a question that requires critical analysis on global, organizational and individual levels. But the effects of this pandemic are enduring and in my view, it will take at least about a year for the world to get back to normalcy.
What will be the effect on the M&A industry
Multiple aspects of the Media and Advertising industry are going to get affected by this unprecedented situation, one such aspect being content production and consumption. Doordarshan has once again started to reign the Indian Television. While other channels are showing repeats due to the lack of new content, older programs like Ramayan and Mahabharat on Doordarshan are keeping the people amused amidst lockdown. This will act as a wake- up call for the television industry which currently follows the hand-to-mouth approach. People in the industry will rethink the way programming is done and strive to move towards innovative approaches that help them maintain content banks for their viewers. Talking about digital, there has been an evident increase in the consumption of digital content. However, with shoots pending due to the current scenario new content production remains a problem even for digital platforms. Even post lockdown, the frequency of shooting episodes is going to reduce and a significant amount of inventory shortage will also be witnessed as far as production is concerned. Hence, people will have to make do with the current bank of content for a couple of months post lockdown, to say the least. Another interesting aspect is the new formats of content that people are trying to reach their audiences at home. One such instance was when the world-famous television show ‘Saturday Night Live’ kicked off from home amidst the COVID-19 lockdown. So in terms of content, the pandemic is pushing the content creators to come up with newer innovative approaches.
Moving on to Advertising, every organization’s strategic action plan is most likely to include a reduction in high-cost television commercials which translates to advertising efforts amplifying on digital platforms. Experts will look at advertising on digital platforms for higher volumes and lower costs.
Overall, it is difficult to say what the impact will be. A lot of it is going to depend on the strategic calls that the brands and the media and advertising companies take. One can never gauge the return of such pandemics and therefore it is important to be proactive and plan for such adversities. One should always be on the lookout for innovative solutions and creative implementations of content.
Will traditional media see a downturn post lockdown?
I shall answer this with an example. Advertisers tend to lock budgets for properties. For example, if an event like the Indian Premier League (IPL) does not happen, the broadcaster and brands associated will be impacted but at the same time, the ascertained budgets will further be channelized to other mediums and properties. Therefore, reinvention is the key. In the current scenario, the consumption habits of people are evolving simply because of the lack of options available. A consumer of Maggi noodles might have to make do with Top Ramen noodles because of the shortage of Maggi noodles in the market. Similarly, due to the lack of newspaper deliveries to every household, people have shifted to consuming News through digital mediums. So, we see that yes, a shift is taking place and the traditional media is getting affected but even for digital mediums to continue growing, they need to keep innovating and inventing. A downturn, maybe not but yes this pandemic will have traditional media outlets pull up their socks.
How dynamic content and relevant communication is the key to this lockdown for the M&A industry?
The ways in which we communicate with our audiences change every second in this industry. Therefore, it is no surprise that because of social isolation, Indians are consuming vast amounts of media. Brands are trying to find solutions to keep their audiences engaged. Some of them are even refurbishing content to suit the needs of their consumers. For example, today, in the market there are a lot of Korean shows floating around with Hindi subtitles.
Social isolation has made people as well as brands more creative. The rapid increase in OTT platforms has given space to a lot of regional content. Regional films, web series and podcasts have gained a lot of popularity amongst different generations. There has been a surge in app download and it is important to note that the consumption of online video content has significantly increased, thanks to the internet’s low distributions costs. While some of the apps like Zoom, AajTak, Jio TV, Uvideo, Helo, Likee, Zili, Bigo have been around for a long time, it is only now that people are relying on them to keep themselves occupied or distracted.
The production quality might have gone for a toss amidst all this but creativity triumphs all.
Will the digital medium come to the rescue of the M&A industry?
While digital is gaining a lot of popularity during COVID-19, television viewership has reached a historic high. People are sitting in front of their television sets and are either watching resurfaced content or over-the-top content that is being broadcasted on television. People are surfing more channels and are looking for content that will keep them entertained. Television is definitely going to be a part of Indian families. But other mediums are also evolving.
For example, Disney+ has used the lockdown period and has aggressively advertised on digital platforms and television. Thus what Amazon Prime and Netflix took years to achieve in terms of subscribers, Disney+ was able to achieve in 21 days.
So, I don’t think it’s fair to say that the digital medium has come to the rescue. COVID-19 has forced advertisers to re-evaluate, adjust and adapt to new strategies, find new permutations and combinations and find a plethora of exciting ways to connect and engage. And I am sure people are going to use a mix of channels to reach their goals.
With all major events in India as well as globally canceled, what will be the effect on the industry in general?
A lot of industries/sectors have written off 2020. These events are majorly backed by advertisers. Today advertisers are facing the heat because products and services are not being sold. The events will, therefore, be done, but at a much smaller scale. Olympics was pushed and the uncertainty that looms over the IPL is testimony to the fact that this year is not going to be a very fruitful one. Be it sports events, conferences, seminars, award ceremonies or fashion shows, creators will eventually have to reinvent.
I’m sure after a careful review of the situation people will start finding alternate options to the new normal that we will be entering after lockdown. Maybe the future is more technologically driven than what we had prepared ourselves for.
Are you envisaging budget cuts when it comes to advertising campaigns?
In a global crisis, like this, when cash flows and demand are hit, advertising budgets are likely to be cut across the board, not just in terms of media spends but production budgets will also get affected. Overall, we will see curtailing of spends and a switch from branding-led-spends to performance-led-spends may also be witnessed.
Are you seeing by the end of 2020 smaller agencies would get merged?
It’s not going to be a question of big and small, instead, it’s going to be a question of agencies re-inventing themselves to give better value to their clients for the money that they are spending. So any agency irrespective of the size that can churn out better value and a better ROI will be the one to power-through and stay afloat amidst the ongoing crisis.
Is there enough communication in terms of educating people in the times of crisis?
Currently, there is a problem of plenty on digital platforms. There is too much information available and little knowledge about which piece of information is credible. The stumbling-block here is to filter out the right information like plenty of fake news too is doing rounds across all digital mediums. So the users must rely on their discretion.
