Mktg - Political advertising budget to increase by 25-30%
Amidst all-round slowdown in advertising, big-budget political advertising is set to come to the rescue of the industry. According to experts, central and state governments will increase political advertising budgets by 25-30% this fiscal.The Congress party has already set aside a budget of Rs 150 crore for the coming general elections, in addition to its ongoing campaign in Delhi worth Rs 40 crore. Bhartiya Janta Party (BJP) is expected to shell out an equal sum to give Congress a tough electoral fight. Political parties are expected to spend over Rs 300 crore by March-April 2009. Says an official from JWT India, one of the shorlisted agencies for the Congress’s general election campaign, “While ad budgets for the mainstream sectors are facing huge cost cuttings, political advertising will be a windfall.” Following slowdown in consumer demand and escalating input costs, all major real estate developers have cut their advertising budgets by around 5%. Ditto for aviation, auto and hospitality sectors, though the extent of cut is much deeper with airlines. Also, in the beginning of the year the party spent Rs 5 crore, 40% of the party’s estimated ad spend of Rs 12 crore in the 2004 Lok Sabha elections, to tom-tom its Rs 70,000-crore-odd farm-loan waiver scheme. Says Mudra Max MD Chandradeep Mitra, “The industry will see an increased spending by the government. The political ad campaigns will not be limited to election season, but will emerge as a strong option to connect with masses.” While BJP has not yet officially enlisted an ad agency for the forthcoming Lok Sabha or assembly elections in Delhi, Madhya Pradesh, Chhattisgarh and Rajasthan, one of the biggest political campaigns is expected by the party around its chosen theme of ‘Save India’ in the context of increasing incidents of terrorists attacks across Indian cities. The BJP-led central government had splurged over Rs 75-100 crore on its India Shining ad burst in 2004 though the party lost at the hustings, and India Shining became more a case-study of how not to run mass-based political campaigns. Not everyone though is convinced that political advertising alone can shore up dipping revenues across Indian ad land. Says Lintas Media Group COO & joint president Sudha Natrajan, “Government campaigns cannot be expected to be a saviour in distressed times as formal political advertising has been quite limited in this country, and, so, its impact on the ad industry is fairly limited unlike in the US.” Barack Obama broke records by spending $60 million to run more than 1,00,000 political TV ads to win presidential nomination this year. However, Percept/H CEO Ajay Chandwani feels even though political advertising is at a nascent stage, with the kind of investments being planned by political parties we can expect budgets closer to that in the US.