As per Madison Media Group CEO, OOH Vikram Sakhuja, the current situation is worse than the 2008 recession because the coronavirus pandemic has brought economic activity to a halt.
He added: “This is worse than in 2008. Economic activity has halted. The economic environment was already slightly soft and GDP growth was projected at best to be 5% before the CoronaVirus. The entire output of the country has come to a halt for one or two months. I heard an economist say that we will be lucky to achieve 2% growth. GDP growth of 2-3% will hurt a lot. A lot depends on how long things will continue. We will have to revise our forecasts. There is no question about that. It is a wait and watch thing. With the stay at the home thing that is happening, there will be a very steep drop in advertising at this point in time. It was a steep drop in March and it will be a bigger drop in April. Overall it will be quite a bloodbath in April.”
He further said: “You have to remember that last year in April on television there was the IPL and the Elections. So TV advertising this year in April will definitely not be at the same level. The print is taking a temporary hit with newspaper supply not happening in Mumbai. Outdoor is completely impacted because people are not moving out. In-cinema advertising is also impacted as nobody is going to them. Post-April it depends on when things come under control.”
A large part of the IPL ad spend on TV and digital -Rs. 2300-2400 crore- used to be incremental to the entire ad pie. He noted that some of these spendings might go back to the main general entertainment channels but that has to be weighed with the reduced advertising that is being planned for at this point in time.
But not just due to IPL, loss will be everywhere, given the bleak situation.