29 October, 2020

On Diwali Sale: Ad Space

The advertising world is reeling under the impact of the cash crunch in the market

On Diwali Sale: Ad Space
outlookindia.com
-0001-11-30T00:00:00+05:53

THE Goddess of wealth has not blessed the advertising industry this Diwali season. The slowdown that started in March 1996 has peaked now. Financially debilitated, the industry doesn’t expect relief too soon. The severe cash crunch facing manufacturers and marketers is making them turn to their favourite scapegoat, advertising. Ad budgets are being slashed mercilessly.

While product advertising has seen a negligible increase in volumes, corporate advertising budgets are down to a fifth. With an all-time low in the equity markets, financial advertising is virtually absent. From an average of 160 issues per month, there were about 47 in October. Many medium and small companies have chopped budgets down to about 20 per cent of their previous year’s figure. If the large, fast-moving consumer goods companies haven’t cut budgets they are definitely holding back releases substantially. Even typically cash-rich industries, like pharmaceuticals, are cutting back on spending. A prominent pharma advertiser has cut its budget from Rs 16...

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