Hoarding sights

ADVERTISING: Rising competition to bag plum contracts in Kolkata could be a lead indicator to an impending shake up in the wider outdoor advertising market.

In Kolkata, trends are being set in outdoor advertising. With several national and international players jumping in to claim a fair share of the fast-growing market, "adver-pricing" is touching new highs.

Earlier this year, Times Out of Home (Times OOH) acquired 80 sites in Kolkata on the Metro Railways channel which runs along (erstwhile) Chowringhee Road. The amount Times OOH agreed to pay, say outdoor industry professionals, is far higher than that of these sites earlier.

Jagran Engage, which has been around for barely six months, has acquired marketing rights for a few sites at prime locations in the city, besides entering into a tie-up with a prominent local player for greater coverage of the city.

Clear Chanel, the American outdoors major, inked a pact with Salvis, a large Kolkata-based concessionaire, last August, giving the former control and marketing rights over 88 billboards.

If the above are instances of outsiders trying to get a finger in the Kolkata market pie, there's our very own Enkon which has ventured out into Mumbai and Delhi. In the past seven months, Enkon has got 10 sites through tenders by BMC, BEST and Western Railways.

Clearly, the developments in Kolkata are a reflection of the shake-up going on in outdoor advertising sector all over the country. And there's more to come with two major international players, JCDecaux and News Outdoor India, having started their operations in India this year and another, Viacom, reportedly waiting in the wings.

Says Sumantra Dutta, managing director, NOI, "We are looking to form joint ventures with local companies. We already have the management, lineage, expertise and products "" what we are looking at is to marry into local expertise in this space."

Outdoor (or OOH), which at Rs 1,000 crore has the third largest share (8-9 per cent) of the all-India ad pie and is growing at a rate of 14 per cent compounded annually, is attracting a new respectability with advertisers. Especially for companies in the telecom, media, and retail sectors, OOH has emerged as a medium of choice.

Unfortunately, the OOH sector has languished because traditionally, the owning of outdoor-advertising properties (hoardings, bus-shelters and other street furniture) has been highly fragmented and un-organised. High levels of political inference and unclear government policies make the situation worse. No wonder, small local players who have given no thought to investing in better quality or technology have dominated the market. That will hopefully change with the entry of deep-pocketed players, Indian or MNC, with an all-India footprint.

The beneficiaries of the present scenario have primarily been the government organisations that own sites and periodically auction them to concessionaires. Take the instance of Metro Railways. It earned Rs 5.05 crore as revenue from hoardings in 2004-05. In 2005-06, the figures jumped to Rs 6.64 crore and would have been higher but for the 36 hoarding-sites on the Maidan it had to dismantle as a result of a court order (an ever present threat).

More important, however, is what impact it could potentially have on the Indian cityscape. "Visual pollution" is a charge increasingly being brought against OOH. No wonder, the authorities "" often prodded by the courts "" have come out with regulatory initiatives for hoardings. For instance, take Kolkata, where a number of hoardings in the Dalhousie Square area were ordered to be removed by the state government. It is here that the big players who operate on sites tendered by government departments rather than illegal private ones will make a difference.

Also, the focus is on developing innovative outdoor advertising properties. In June this year, NOI won a contract to develop futuristic bus-shelters in Bangalore. JCDecaux will also be developing bus-shelters in Noida. In Kolkata, Enkon recently won a 10-year-Rs 25 crore contract from the Nabadiganta Municipality, that manages the IT district in Sector V, for developing and managing under-passes, bus-shelters and other street furniture.

Of course, consolidation of sites will also help ad agencies create campaigns that are actually location-coordinated "" a rarity now.