Ad spends rise on proliferating media

In recent times, media proliferation has led to an inflation in media costs. Experts in the advertising business point out that to deliver the same reach, companies today need to spend 30-40 per cent more than they would a couple of years ago.

For instance, on a mainline Hindi general entertainment channel, if the cost per rating point was Rs 100 in 2005, it has increased to Rs 130-140 in 2007. Hindi GEC accounts for roughly 75 per cent of the TV ad spends.

Anupriya Acharya, the president of TME, a division of Rediffusion DY & R, said, "There may not be a real inflation in terms of physical costs going up, but inflation has been an outcome of the fragmentation of both inter-media and intra-media." The fragmentation is also not restricted to the boom in the number of television channels or the increasing number of publications. Instead, the fragmentation within the media now includes the internet boom, the resurgence of radio and the emergence of mobile as a mainstream advertising medium.

"The growing fragmentation in the media has resulted in a viewer spending less and less time with each medium," explains Chandradeep Mitra, president, Optimum Media Solutions, the media buying venture of the Mudra Group. He adds, "As a consequence, even the ratings of prime-time slots have fallen and the average reach of each ad has decreased. If the companies set a target of showing the advertisement of their product to a given set of consumers, they would then have to increase the frequency of their ad to reach all those consumers."