Advertising & Marketing
India
Putting an end to weeks of speculation, consumer
electronics company LG Electronics India Ltd (LGEIL) has split its advertising account
between McCann-Erickson and O&M, Delhi. This was confirmed by Anil
Arora, head, marketing, LGEIL, who said, “We have empanelled O&M and
McCann-Erickson. The Rs 75-crore business is going to be equally divided between the two.”
While LG reviews its agency alignment every year, the latest reshuffle assumes great
significance given the ambitious business plans of the company. “This year, the
company hopes to achieve a turnover of Rs 4,500 crore and the target set for the next
calendar year is Rs 5,500 crore. Which means we are looking at a growth of Rs 1,000 crore
in one year. In that context, advertising is of critical importance,” Arora said in a
recent interview. An interesting thing about the LG pitch is both the new agencies –
O&M and McCann-Erickson – have conflicting businesses. While O&M has
Electrolux (and, till recently, Onida’s CTV, DVD and home theatre systems businesses,
which have subsequently been ‘parked’ with Lemon Communications),
McCann-Erickson handles National Panasonic, comprising audio, colour televisions, home
theatre systems and camcorders. Electrolux has already called for a pitch and newspaper
reports suggest Onida businesses with Lemon are also up for grabs.
Source: Agencyfaqs.com, Nov.5
How do you add excitement to a product category
characterised by low consumer involvement and depressed growth? Try painting it with the
hues of fast moving consumer goods! Which is exactly what the Rs.
5,800-crore domestic paint industry has been doing. The latest to aggressively join the
ranks of high-pitched FMCG advertising is the paints industry. While high-decibel seasonal
advertising is nothing new for it, companies this season are betting on high profile
Bollywood stars like Amitabh Bachchan (Nerolac Paints) and Akshay Khanna (Asian Paints) to
form an emotional connect with the consumer. Points out Radhika Roy, National Head –
Qualitative Research of research agency NFO-MBL India, “ There is very little scope
these brands have to differentiate on product/price or any other tangible option,
therefore the need to bond emotionally. Here too I think it is a challenge to appropriate
the emotional space, which is largely generic in nature and common to all paints. Asian
Paints did do a brilliant job through its various ads in trying to make the functional
aspects more emotionally meaningful. In all the seasonal pressures, celebrity endorsements
look like a good ‘short cut’ to the consumer’s heart and mind. To that
extent it is very much FMCG—High parity/low differentiation, cluttered media.”
Nerolac in fact has been using the brand ambassador strategy for quite a while now in its
regional advertising. “We were the first paint company to use brand ambassadors to
endorse its products,” says Anuj Jain, Vice president, (Marketing and Sales) Goodlass
Nerolac Paints Ltd. Market watchers, however, observe that celebrity endorsements
are generally used to create recall or push sales for a short period of time. While
advertising throughout the year seeks to convey the functional benefits of the product
such as longevity (e.g. Asian Paints ‘Badiya Hai’ ad for its exterior emulsion),
during the key September-November period, the focus is on reaching out to the masses.
A company like Berger has hiked its above the line budget this season by about 15%, and is
advertising primarily in the electronic media. The reason, according to market estimates,
about 30-35% of sales of the 4000-crore domestic paint industry come from the Sept.-Nov.
period. However, it remains to be seen largely whether celebrity endorsements translate
into actual sales spurt for these companies.
Source: The Hindu Business Line, Oct. 23
Soon enough you’ll be able to choose programmes and
movies and see them at your convenience. That’s for starters. You’ll also be
able to scan multimedia programme guides at the touch of a button and record shows. These
services will be offered in the near future by Reliance Infocomm. In
the next few years the Ambani-controlled company hopes to enter homes with a range of
services like these and more, by using its nationwide broadband network. Those who
subscribe to the company’s broadband digital subscriber line (DSL) connection (which
is used to hook up to the internet) can now use the same “pipe” to access
entertainment programmes either on a PC or on a TV set, and of course, with the set top
box.
About a fortnight ago, Reliance Infocomm signed an agreement with US software company
Microsoft Corp to jointly create, test and deliver next generation internet protocol
(IP)-based television services. The US company will employ broadband networks used for
internet access to offer television quality signals at homes. Reliance is the 2nd company
(after Bell Canada) to have agreed to test Microsoft’s new technology. What’s
special about Microsoft’s IPTV? –It has three things going for it: Broadcasters
can send multiple audio tracks; it has less disturbance and is less interactive. Above
all, it offers telecom companies the ability to offer pay TV services.
The disadvantage of IPTV, some say, that video and audio quality could be better.
Microsoft has developed an advanced compression software, Windows Media 9, which is said
to deliver broadcast quality video over telephone lines but occupies little space
(compared to MPEG-2, in standard use by TV and cinema today, it uses as little as a third
of the bandwidth required for video delivery).
Source: Business standard, Nov. 5
TV Today network Ltd., owners of news channel Aaj Tak and
Headlines Today, on Tuesday filed a draft prospectus for an initial public offering (IPO)
through the book building route to part-fund its Rs 100.2 crore expansion programme.
TV Today requires Rs 50 crore for infrastructure upgrading in 2003-04 and another Rs 44.2
crore in the financial year ending March 31, 2005. Plans are also to use an additional Rs
6 crore for general corporate purpose. TV Toaday's planned expenditure in 2004-05 includes
Rs10 crore for installation of pay channel infrastructure. The expense towards digital
integrated receiver decoder is Rs 6.8 crore, while for conditional access software it is
Rs 1.3 crore. The hardware for installation in earth station is put at Rs 1.9 crore. For
2003-04, the expenditure towards upgradation of existing news channels and news gathering
infrastructure is put at Rs 48.9 crore. The balance of Rs 1.1 crore of the Rs 50 crore
expenditure is towards setting up and up gradation of news bureaus. In 2004-05, the
expenditure towards to wards up gradation of existing news channels and new gathering
infrastructure is Rs 34.2 crore.
Source: The Wall Street Journal, Oct. 29
In the highly competitive news channels market, Prasar
Bharati is not taking chances and has decided to get aggressive with its marketing plans
for the newly launched news channel. For the first time, the national
broadcaster has come out with a `market-friendly' advertising rate card and has tried to
throw in some freebies in a bid to generate revenues. This is because the Finance Ministry
had earlier asked Prasar Bharati to sustain the channel internally and not rely on
budgetary support. And the efforts seem to be paying off because within the first few days
of launch, DD News has managed to tie up advertising of over Rs 1 crore. According
to officials, while there are no specific targets for the current year, the revenue target
for the next fiscal has been fixed at Rs 25 crore. The sponsorship rate for a half-an-hour
show has been pegged at Rs 10,000 with 240 seconds of free commercial time (FCT) while the
rate during non-prime time is Rs 5,000 for a half-hour slot with 270 seconds of FCT. The
channel is focusing on spot buys rather than sponsorship and rates have been pegged at Rs
3,000 for a 10 seconder during prime time and Rs 2,000 for a 10 seconds spot during
non-prime time.
"Besides this, there are sops for bulk buyers who are planning to invest between Rs
25 lakh and Rs 50 lakh which includes spots on DD Bharati as well," said officials.
Also, for the first time the channel will offer a special rate for ads falling under the
run-of-the-day parts (ads which can be aired anytime during the day).
All Out Mosquito Repellent is the first brand to have signed on and has committed
advertising of about Rs 61 lakh. "It will sponsor the news headlines, text headlines
and stock ticker branding," said sources. Some auto companies and food companies are
also in the fray.
Source: The Hindu Business Line, Nov. 6
The world
The 30-year old James Murdoch joined his media mogul
father Rupert on Monday at the top of the organization chart at BSkyB, Europe’s most
profitable pay-TV channel company, despite fierce opposition from several large
shareholders concerned about the company’s independence. His
ascension was seen as a foregone conclusion by many, with his father openly hyping him for
the job. News Corp.owns more than a third of BSkyB shares. Now James is on equal footing
with his older brother Lachlan, high ranking News Corp executive and publisher of the New
York Post, in the contest to succeed their father.
When News Corp.’s Internet business was founded in the early days of the dotcom boom
to house websites such as FoxNews.com, James was made president of the unit and managed
investments in TheStreet.com, PlanetRx and Healtheon/WebMD. But as boom turned to dust.
News Corp had to write off much of its $1 billion investment. As dotcoms imploded, James
was off to Hong Kong as chairman and CEO of Star TV. He kept a low profile in China,
working to establish the Sky Platform across Asia.
Source: Economic Times, Nov. 5
India has driven Star’s growth and profitability in
Asia, News Corp. chairman Rupert Murdoch said at the annual general meeting of the company’s
shareholders at Adelaide, Australia, on Oct 15. Star’s growth in
India comes at a time when it has suffered start-up losses in countries such as China and
other Asian countries. Star’s strength, particularly in India, fuelled its first ever
full year of profitability, even as the platform absorbed start-up losses in mainland
China and elsewhere in Asia. Murdoch said that according to estimates, Star India has
booked revenues of $200m in 2002 (this is about 70% of Star’s Asian revenues). The
company is taking aggressive steps to further increase its revenue in India. As part of
this plan, the company had cut the subscription rate for its services and asked cable
operators for a higher declaration of subscribers. As a part of its expansion plans here,
the company also plans to enter direct-to-home (DTH) satellite television distribution
system in India in partnership with an Indian company.
Source: Business Standard, Oct. 24
Print Media
India
“All big industries have it except ours,” says
Mr Amit Agnihotri, Editor, Pitch, the advertising, marketing and media review magazine,
which hit the stands last month. The lacuna left in the advertising
and media space for printed news is finally getting filled after a gap of nearly 2 years.
Post the demise of magazines such as A&M and Brief, a set of new magazine brands such
as Pitch and USP Age are here to fill the slot along with UK-based Haymarket group’s
magazine brand, Media. Portal exchange4media’s Pitch already has the first mover
advantage. To avoid overlaps between its website and magazine, Pitch would clearly deal
with more feature-led information while exchange4media website will look at news. Funded
by three promoters with experience in the media and advertising industry, the
exchange4media’s foray into the print medium has been funded through internal
accruals generated by its company, Adsert Web Solution Ltd. Priced at Rs 50, pitch has
print run of 20,000 copies initially and has forged a distribution alliance with the India
Book House. In its latest issue, pitch has partnered with WPP’s Mindshare and
Maximise to bring out a study on the advertising outlook for the year 2003.
Source: The Hindu Business Line, Nov. 5
Yet another magazine in the advertising, marketing and
media space that is waiting to hit the stands this month is USP Age.
Priced at Rs 40, it will be a monthly publication dealing with marketing, advertising, and
related areas. Interestingly, USP Age will cover everything to do with communications
strategy. This includes a gamut of areas—Print, electronic media, radio and internet.
The reader is supposed to be in the communications business—Advertising and
marketing, public relations and event management executives and journalists, according to
Mr. A. B. Ravi, Editor, USP Age. Funded by Mr C.D. Ramachandran, founder-promoter of
Imageads (Advertising & PR agency) and G. Ramachandran a start-up specialist, the new
company christened Brand Vision India Pvt. Ltd. Has forged a tie up with the US based
advertising conglomerate, Worldwide Partners, for a marketing and content sharing
arrangement, which will circulate USP Age in almost 40 countries.
Source: The Hindu Business Line, Nov. 5
The world
Fifteen Indian companies with high-technology equipment
will be participating in Drupa 2004, described as the "Olympics of the printing and
media industry", being held in Dusseldorf from 6-19 May next year.
Held every four years in this German city by Messe Dusseldorf, which has representative
offices in New Delhi and Mumbai, this international fortnight-long exposition showcases
the total range of production equipment, materials and services currently on offer as well
as pioneering innovations that will be decisive for the print media in the coming years,
says Messe Dusseldorf project director Manuel Matare. A team comprising Matare, CIDEX
(India) managing director, Norbert Schmidt, Dr Wilfried Schaefer, (MD) Association of
German Manufacturers of Printing and Paper Equipment and Suppliers, and head of foreign
representation of Cologne and Dusseldorf in India, Xavier Rebello, made presentations to
the Indian Exihibitors, visitors and the media in New Delhi and Mumbai, last fortnight.
CIDEX is a joint venture of Messe Dusseldof and Koln Messe International, having taken
over the responsibility of promoting fairs in these two German cities from IGCC recently.
Speaking of Drupa's significance, Matare quotes Bill Gray of TAGA as declaring
"Drupa's the wake-up call to the industry".
Schaefer points out that while the larger companies tend to be secretive about the new
products and technologies they intend to unveil at Drupa, the basic trend is towards
cross-country digitalization. He also notes that German manufactures as a rule are
committed to train the human resources of their clients, their industry offering
programmes such as 'Printpromotion', which were highly rated in the profession.
Drupa 2004 will be having 1,800 exihibitors from 63 countries displaying their
products. Rebello, Indians who visit the fair for print media, publishing and converting
technologies will be able to access the latest trends in the prepress and premedia
(systems, appliances, software), printing (machinery, appliances, accessories), book
binding, print finishing (machinery, appliances, accessories), paper-converting,
including package production (machinery, appliances, accessories), materials, consumer
goods and services.
Source: Business India, (Oct. 27-Nov. 9)
Radio Media
India
With the constitution of a Radio Committee by the
government this year, to make draft rules for Radio Broadcasting Phase-2, the private FM
scenario is set to change. The committee has recommended that 26% FDI
be allowed in commercial radio (thereby bringing FM radio companies at par with print
media) and that licence structure be done away with. It also recommended that a revenue
sharing scheme be introduced among commercial radio stations along with a one-time entry
fee. The percentage of revenue sharing is proposed to be as low as 3-3.5 %. It has been
reliably learnt that the govt is likely to accept the recommendations of this committee
despite some internal opposition.
The change in the FDI policy will particularly benefit Radio City, which is operated by
the Ispat group's Music Broadcast Private Ltd. (MBPL), and has Star group subsidiary
Digiwave as content provider. Only 20% FDI is currently permitted and that too though the
FII route. The non - parity with respect to terrestrial TV channels will be discussed when
the committee finalises the draft within a week.According to the government
officials, it is Digiwave and not MBPL that is running Radio City. In the second
proposal, industry sources say that a revenue sharing arrangement whereby the government
has access to only 3-3.5% of total revenues is something that should be reviewed. For one,
no private player will declare its absolute revenue when it has to be shared. Moreover,
the license period is slated to be around 10-15 years. Tying up one company to one
frequency for such a long period may simply not be viable.
The private players who have suffered on account of the high licensing fees are likely to
protest against the fact that the newcomers can getaway without paying them. However,
agreements may not be difficult to reach in this case, as the telecom settlement method is
likely to be followed.
The draft is also likely to do away with the technical specification and co-location of
transmission towers, allowing private players to relocate to transmission towers other
than those of AIR and also allow them to have three to four smaller transmission towers
rather than a single powerful tower. Recommendations are also likely to open up the
networking provision, which will allow FM radio stations to broadcast the same content in
two different locations being served by the same broadcaster. Phase-2 is a major step for
the broadcasting industry as it will open up 70 new cities and nearly 200 frequencies will
be auctioned.
Source: Business India, (Oct. 27-Nov. 9)
The world
A recent BBC contest has proved that when it comes to
writing in the genre of Radio plays, Indian writers are among the best in the world.
Two Indian dramatists have bagged prizes at recently concluded BBC World Service
International Playwriting Competition , 2003. This was the 8th biennial radio playwriting
competition by the BBC. Loyalty by Anuradha Swaminathan is the 2003 winner in English as a
Second Language category. Collaborators by Mumbai Playwrite Ramu Ramanathan (of The Boy
Who Stopped Smiling and Mahadevbhai fame) has won the 2003 Regional Award.
Source: Times Of India, Nov. 2
Web Media
The world
The Wall Street Journal on Monday said it is changing the
way it tallies circulation to include subscribers to its Website and is adding new
incentives for online advertisers in an effort to boost ad sales. It
will now begin including online circulation in its overall subscriber tally, which will
increase its overall circulation figure. The newspaper, which has struggled with an
advertising slump over the last 2 years because of rough economy, said that the change
would present the overall circulation picture to advertisers better. “The new data
will enable us to better communicate to advertisers and potential readers that the journal
franchise serves a large, growing base of similarly high demographic readers who receive
our content in different forms of distribution”, said a spokeswoman for Dow Jones
& Co. Inc. New advertising programme will also offer advertisers special credits to
use towards future ad spending when they maintain their print ad spending and increase
online advertising. The incentives are aimed at encouraging large print advertisers to
devote additional marketing spending to the online Journal.
Source: The Hindu Business Line, Nov. 5
Events & Public Relations
India
British fashion and lifestyle brand Austin Reed is making
a foray into India and its advertising and public relations line adopted will be in tune
with the global positioning of its stores worldwide. The strategy is
to understand the consumer in India and then grab a piece of action. The mode of entry has
been through an exclusive tie-up with Shoppers’ Stop. Under this, the Austin Reed
range of formal business wear and smart casual wear for men, will be available at Shoppers’
Stop outlets through shop-in-shops. To begin with, the brand will be available in Mumbai,
New Delhi and Kolkata and from there on it will be taken to more stores by early next
year.
Brand positioning for shop-in-shops has been made in line with the positioning of Austin
Reed stores worldwide. In fact, elements of the decor at the recently done up Regent
Street flagship store in London have been incorporated in shop-in-shops at Shoppers’
Stop, he said. So even when the communication in India happens through advertising and
public relations, the line adopted will be in tune with the global positioning, which has
been arrived at through these mediums. The formative months will be utilised to understand
the reaction of the consumers to the brand and thereon, more product offerings will be
rolled out. Growth through shop-in-shops is an exclusive arrangement with Shoppers’
Stop and the brand will grow in tandem with the expansion of Shoppers’ Stop, Austin
Reed Group PLC chief executive, Roger W Jennings said.
Source: Financial Express, Oct. 28
Films & Cinema
India
After showing some good cheer for 4 months the film
industry slumped a bit again. The last 5 weeks have not seen big
taking from any film. Despite the festive season, Boom, Pinjar, Mumbai Matinee, among
others haven’t yet excited filmgoers.
Source: Business World, Nov. 10
Applause Entertainment, a company set up by
Kumaranmagalam Birla in his personal capacity, has just completed a Telugu film.
Tapana which is said to have cost just under Rs 2.5 crore, will be released in February
2004. Applause is also looking at making a Bengali film.
Source: Business World, Nov. 10
Miscellaneous
The world
Time Warner delivered a mixed performance in the third
quarter as parts of media empire reported growth while others declined.
Strong growth in the company's cable, television and film divisions was marred by the
continued malaise at its music and America online units, as well as a surprising downturn
at its publishing arm. The group is still failing to fire on all cylinders 4 yrs after the
disastrous merger of AOL and Time Warner. To draw a line under the past, the company
formally dropped AOL from its corporate name, reverting to Time Warner. But investigators
at the justice department and Securities at Exchange Commission are still examining the
company's accounting for controversial advertising deals signed at the height of the stock
market bubble. The New York Times reported that the SEC planned to interview Dick Parsons,
Time Warner's chairman and chief executive, and Steve Case, former chairman, over their
roles in a $400m advertising deal with Bertelsmann, the German media group.
Mr. Parsons applauded the company's cash flow and its efforts at debt reduction. Time
Warner generated $3.2bn of free cash in the first nine months of the year and is on target
to reduce its net debt to $20bn by the end of next year. Mr Parsons also suggested the
company's profit growth next year would accelerate, helped by an expected return to growth
at America online. Overall revenues were up 4% to $10.3bn in the quarter, while operating
income increased from $1.31bn in the same period last year to $1.4bn.
Time Warner cable unit, operating income was up due to the growth of high speed internet
access and new services such as video on demand. Profits at the cable TV networks,
including Turner, HBO and CNN, were up 17% as cable continues to lure viewers from
broadcast TV.
However, profits in the publishing division dropped 25% reflecting the effects of the
difficult advertising climate on Time Inc., the world's largest magazine publisher. The
company is also planning to restructure its Time Life direct marketing unit following a
sharp fall in sales.
At the close in New York, Time Warner shares were down 49% at $15.06.
Source: Financial Times, Nov.5
Compiled by
Saurabh Marya, BA Mass Comm (1st year)
Assisted by
- Kumar Gandharva, BA Mass Comm (1st year)
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