Campaign India Team
May 26, 2009

Clear mandate great for adland

  Arvind Sharma, Leo Burnett India

Clear mandate great for adland

  Arvind Sharma, Leo Burnett India
India is rightly celebrating the wisdom the electorate has displayed in 2009 elections. With a clear mandate for the UPA, prospects for both business and advertising have brightened. I expect the sentiment to lift almost immediately with businesses moving forward with their investment plans in a sure-footed manner. Over the next six months, a number of policy decisions that had been held up- pertaining to retail, pension, telecom etc- will bring in significant amount of investment and drive business and advertising activity.


  Sam Balsara, Madison
The Election Results are the best news we have got in a long long time and augurs extremely well for India. The electorate has proved more intelligent than we give them credit for. It hopefully marks the end of coalition politics. It will allow the Congress to move ahead decisively with what it wants to do without having to constantly appease coalition partners and worry about getting toppled.

The Congress can now go ahead with its policy of chasing aggressive economic growth and development, attract foreign investment, increase limit of FDI in certain sectors where restrictions exist, divestment in PSU’s. All this will quicken the pace of GDP growth.

This good news coming from India at this time where there isn’t too much good news coming from anywhere else in the world is going to do a lot of good for India and change sentiment in India and confidence of Indian businessmen in immediate future. And advertising growth is determined largely by sentiment.

With this change in sentiment, the advertising sector is bound to bounce back and the Pitch –Madison Media Advertising Outlook update that we have promised in July August will be very different in character than the one we put out in January

I am keeping my fingers crossed that the Congress does not waste or botch up this golden opportunity.

 Subhash Kamath, BBH India
I am absolutely elated and relieved that Dr. Manmohan Singh will continue at the helm. Economic progress is the only thing that can take this country forward, and he’s easily the best man for the job. India’s growth story is very critical, especially when the first world economies are facing a meltdown. I believe this electoral mandate will mean more growth and more investments for India, and our economic policies will thankfully carry on unhindered. It is bound to have a very positive impact for us in advertising. As the markets pick up, sectors like FMCG, telecom, services, automobiles etc will show even better growth and these have always been big marketing spenders. It’ll also mean a slow, but gradual improvement in financial services.

  Aniruddha Banerjee, Publicis Ambience
There will be a positive impact on our industry, for 4 main reasons.

1. One of the impacts on our business was purely a lack of confidence that clients felt about the future. Now, all clients should be feeling a lot more comfortable about the future, and therefore, will be in the mood to make the marketing investments.

2. Certain sectors, like finance, that had gone dormant thanks to the free fall in the stock markets would be be energised. I am sure new investments in marketing are on the anvil.

3. This should also bring in new FDI, and therefore, will increase activity and competition in many of the industries impacted by these investments. That can only be good for us.

4. Most importantly, it would impact our own confidence, and our optimism to make the right investments — as an industry, I think we had also gone into a shell, waiting the bad times out.


  MG Parameswaran, Draftfcb+Ulka
It is a great verdict, a verdict is for stability at the centre. That is a very good for the advertising industry. I believe advertising growth is in many ways intertwined with economic growth. In the past when economic growth topped 8% we saw advertising growth cross the 12-15% mark. I am hopeful that the new government will put in place economic stimuli to drive up growth to the 9% level. We also need a stable forward looking government in the centre to ensure that India’s relationships with the neighbors and the western world does not come in the way of economic growth. The opening up of new sectors for investment, the new 3G policy in telecom etc will all help advertising growth.

 
  Ravi Kiran, Starcom MediaVest Group
The improved sentiment arising out of expected continuity of policies and stability of policy makers, may give rise to increased marketing activity and advertising will be a direct beneficiary.

The long term effect of the outcome of the elections, however, is less simple.

As a derived industry, advertising benefits from public policy in an indirect way.

A lot depends on how the new government accelerates reforms, invests in infrastructure development, creates a business friendly context and in general takes decisive steps that stimulate demand and consumption.

Part of the reason Indian advertising is rather small as an industry is that many categories in India are grossly underpenetrated and most of the year on year growth comes from less than half a dozen categories. If the government makes it more rewarding for people to spend rather than save, demand will grow, industry will benefit and so will advertising.

I also feel that if the government invests more in building urban infrastructure in mid-size and small towns, it will increase a propensity to spend and advertising will benefit.

  Suman Srivastava, Euro RSCG
The election results is going to create a positive sentiment in the stock markets and the economy generally. This will help to turn the negative spiral we are currently in, into a positive one. That will help the industry to grow better than what was forecast at the beginning of the year. I also expect further liberalization to take place in some key sectors during the first 100 days of the new government. Those may lead to new clients coming in and increased spending by clients who are already in the country.

Overall, the industry should smile broadly now that Singh is King again.

 

  Srinivasan K Swamy, RK Swamy BBDO

The mandate for a more stable formation at the Centre without the involvement of the Left parties does auger well for our industry. We already see signs of recovery in many sectors; and the new Government will no doubt do something to get us out of the downturn many sectors are in. After all Dr Manmohan Singh has promised a turnaround in 100 days if voted back to power.

With optimism back on our strides, advertisers would look to market their products and services more aggressively and I therefore expect to return to double-digit growth in 2009-10.

 
  Lynn de Souza, Lintas Media Group

The fortunes of the advertising industry are closely linked to consumer confidence indices.

With the likelihood of a stable and stronger government in the future, which is able to continue current policies and measures, and not be hindered by weaker allies, we should see the economy improving and all the productivity indices in all sectors - agriculture, industry and service - also registering a rise.

When clients prosper we do.

About the media end however, I do not expect to see relief for broadcasters distribution costs, or any immediate relief to publishers input costs, either.

Source:
Campaign India