As TAM plans to take TRPs monthly, advertisers plan to pull out

Many advertisers threatening to pull out since TAM Media Research, which collates weekly ratings, announced to take TRP system on a monthly calendar

ankitalahiri

Ankita Lahiri | July 22, 2013



The television industry is going through a bit of a rough path, it seems. As if the I&B ministry’s ruling on airing a maximum of 12 minutes worth advertisements per hour from October (please see our story here) wasn’t enough, the channels are now threatened with a mini-exodus of advertisers.

Worse, seemingly it’s for no fault of theirs.

Many advertisers are threatening to pull out ever since TAM Media Research, the agency that collates weekly ratings of TV shows based on which advertising agencies pick their ad spots, announced on July 11 that its television rating points (TRP) would go on a monthly trip. Till now, TAM generates weekly TRPs based on people’s metre.

The proposal to take the monthly route comes after TAM decided to issue absolute numbers of audience measurement from the present percentage basis – a long-standing demand of the advertisers to gauge “actual” popularity of each show on a weekly basis. But given the heavy workload in way of number-crunching involved, the agency said it cannot generate the real numbers-based ratings every week, and would instead issue them every month.
And all hell seemed to have broken loose at that point.

Stressing that it is the only means by which they can set a rate for television advertising slots, advertisers want TRPs to keep coming in every week. On July 14, several companies and their advertising counterparts sent a letter to TAM stating their protest about the proposed monthly ratings. They also threatened to pull out within 48 hours unless the media agency changed the evaluation period.

Confirming the move, Arvind Sharma, president of the Advertising Agencies Association of India, said. “As of July 15, about 25 advertisers have pulled out. Many more are following.”

Intekhab Usmani, director of Mindshare Advertising Agency, whose client Idea Cellular is also facing the crunch, said: “As of now, the situation is not very clear because talks are still on. The digitization process taking place at present is taking a lot of time and is in turn causing a lot of problems. For example, in Bihar, where the digitization process is still on, we were unable to get any data. It is only from next week (week starting July 22) that we will get any data from the state (Bihar).

For advertisers, Usmani said, the weekly data is important because they need plan on a weekly basis. “It is foolish to get a monthly data for a weekly plan – it is not comparable and it is very difficult,” he said. “Print (media) gets its data once every three months but it’s once a week for radio and television. This move (to release monthly ratings) will hurt our clients and their brands.

“It will also mean an extra burden for the agency. There is the additional work of turning everything into the context of TRPs.”

The crisis

It is the methodology of the rating system that is causing the feud between the advertisers, the broadcasters and TAM.

Arvind Sharma of AAAI contended that whichever rating system is put in place should be made with the consent of all three parties, adding that the “behaviour of some broadcasters” is leading to such a situation.

"For fourteen years, TAM has been the TV audience measurement system in the country. It has been the currency on the basis of which advertising planning, buying and selling have been conducted,” he said. “We all agree that this measurement system needs to evolve. That is the common goal for which broadcasters, advertisers and ad agencies came together to form the Broadcast Audience Research Council (BARC).

BARC, he said, will take 10 months or so to start generating its audience measurement data.

But in the interim if individual broadcasters try to force unilateral changes in the current system, as some have tried, it will result in a disorderly and hybrid measurement system, Sharma said. “It will become impossible for ad agencies and advertisers to plan and, therefore, buy TV spots. In this scenario, it is natural for advertisers to start questioning the value of advertising in this medium at all.

“Cancellation of TV releases by many advertisers on eight network groups that have insisted on unilateral changes is a natural outcome of that. More clients are following."

The pullout by many big names, including Bharti Airtel and Dabur India, has worsened the issue. Before the announcement by TAM, it was the advertising fraternity that had stood by the media research agency. But it seems while trying to woo the broadcasters, TAM had lost out on its only allies: the advertisers.

Who loses?

Will the current tussle mean the broadcasters will lose out on crucial ad revenue? Or will it mean advertisers will have to do a bit more long-term planning?
Not willing to comment on the issue, Shailesh Shah, president of the Indian Broadcasters Federation, said: “We understand their (advertisers’) problems as well but we have not arrived at any solution as of now. I can assure you that this will not affect the way forward.”

In a recent report, consultancy agency Magna Global has predicted a 7.8-percent growth in advertising revenue in India. Television and print combined, the report said, will contribute to two-third of the total revenue. So will the recent tussle affect growth of the industry?

“The effect of the feud on revenues is not clear yet. Though Dabur and L'Oreal have pulled out their advertisements, others are still contemplating. The situation is still fluid,” said Jehil Thakkar, head of media and entertainment at consultancy firm KPMG. “As for the short-term effect, if there is a lack of measurement, it will reduce the lack of currency of measurement. However, there will not be an effect in the long term because some sort of measurement (read BARC) will come into place.”

As TAM gets tied in this tug of war, and refuses to comment on the topic and clear the fog of doubt, the way forward remains just as foggy. As all three parties stick to their stand, the media industry, especially television, seems to be in a strange, and unwarranted, spot. Only a tilt to one direction can bring a result now.

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