Media Industry

The Audience – Focused Era

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Media Industry – Overview

The Indian M&E Industry is one of the fastest growing sectors riding on
the back on a young Indian population with a higher propensity for
discretionary spending.
Favorable Demographic composition, strong fundamentals of the
Economy and with over 70% of the population being under 30 years of
age is a good field of opportunity for Marketers
Media penetration in the country remains low – there are close to 400
million people in India who can read and understand a language but do
not read any publication. This represents a significant opportunity of
market expansion.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Media Industry – Overview

The strong culture of domestic consumption over the past 5 years

contributed to the Indian M&E Industry growing at a rate of appx 11%.
However, due to the differing impacts of Demonetization on Businesses
& Individuals – Businesses were forced to constantly revise their
earning forecasts basis the changes all around over the last 5 months
of the fiscal 2016-17 – Growth rates fluctuated between 3% - 7%.
The GST and RERA implementation schedule immediately post
Demonetization added to the uncertainty and did not help matters,
although the long term factors to drive growth remained positive.
From a growth rate of 7.1% in 2016, a decline to 6.7% in 2017, the
expected rate of growth is 7.4% in 2018 & further to 7.8% in 2019.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Media Industry – Shifting Sands

As we step into the next 5 years of a growth story, trends of content

consumption in rural and regional markets are bringing about an
increased focus on regional language content leading to growing media
penetration across – TV, Radio, Print & Digital.
Also, with an increased penetration of smartphones, digital usage has
become more democratized and widespread.
The impact of digital usage, has put a steady pressure on traditional
print players – particularly in the English segment – reader &
advertiser migration.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Media Industry – Shifting Sands

Media Companies have been accustomed to competing and creating

differentiation primarily based on two dimensions: content and
distribution.
With a blurring of lines across platforms, being driven by the
convergence of Technology, Media & Telecom (TMT), a new media
ecosystem is starting to emerge and disrupt the traditional media
ecosystem.
Media Companies that wish to capture value amid shifting consumer
preferences and business model disruptions must focus on an
increasingly prominent source of competitive advantage – CREATING
USER EXPERIENCE!

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Traditional Media Ecosystem

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Emerging Media Ecosystem

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Evolution

The Journey started with small & large creative agencies that specialised
in coming up with a strategy, copy & creative for Client Ad campaigns

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Evolution

Media Agencies were formed in the 1970s/80s as that became an

increasingly important component of the value chain.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Evolution

The 1980s / 90s saw the formation of Agency Holding Companies that
aggregated media buying and maintained multiple agency networks to
manage clients, revenues, PR activity, research and stuff. This has
continued to be the way for the past 20+ years while the importance of
data and digital gain mindshare.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Evolution

With the convergence of TMT, the emerging Media Ecosystem is creating

a new set of spaces on the back of Tech – AdTech & MarTech.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Evolution

Today Agencies are no longer alone in the Ecosystem. They are

surrounded by companies – AdTech (Advertising Technology), MarTech
(Marketing Technology), Data Management, CRM, Tech Services and
Retailers.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Evolution

As the Ecosystem evolved, Agencies are under pressure from all sides.
Media buying in increasingly software driven & AdTech companies are
taking a share. Data marketers are squeezing campaign spends and Tech
& CRM companies are taking an interest in advertising.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations

Consolidate through M&A or Alliance building. In 2012, the total value of

media deals was less than $60 billion. That value reached $200 billion in
2016.

https://economictimes.indiatimes.com/industry/media/entertainment/media/media-entertainment-
sector-seeing-strategic-realignment-john-harrison-of-ey/articleshow/60834454.cms

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations – M&A Deals

A host of trends are redefining today’s media landscape. The line

between content creators and distributors continues to blur, changes in
consumption patterns are accelerating, advanced technologies are being
adopted in rapid cycles, and new competitors are constantly emerging.

https://www.ibef.org/news/media-and-entertainment-sector-ripe-for-mergers-and-acquisitions

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations

Acquire Technology Platforms

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations

Acquire Data Platforms to connect the planning process to buying to the

final attribution. WPP’s acquisition of Kantar, Rentrak & comScore is
indicative of the shift.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations

Acquisition of Tech Service. Acquiring the expertise helps build new

capability and stronger value propositions. Publicis acquisition of
Sapient is indicative of that.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations

Larger Players are vying for the overall pie – CRM companies like Oracle,
Salesforce & Adobe already on a acquisition spree. And not to be left
behind are the eCommerce giants like Amazon & Telecom giants like
Reliance – Jio + Saavn.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Shifting Equations

One final equation would be for Media Agencies to become the bridge
that connects every touch point for the marketer using technology and
data as levers – which will lead to the of the unification of the AdTech –
MarTech – Strategy & System Integrators

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
The Digital Evolution

With a shift in the Power Equations, the media value chain evolves strongly
towards a Digitally Enabled Media Value Chain with different players for
each device or platform.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
 With every change there is a new business model
that comes into play. The focus on sustained ROI, and
the price versus cost ratio requires a ecosystem that
is measurable and drives results.
The Rush
All of what we have shared in the previous slides
towards Digital leads up to the emergence of a business model with
technology forming the backbone.

Over a period of time sophisticated Data & Analytics

coupled with the Top 8 – IoT, AI, Blockchain etc. will
change the game from what it is played out today.

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Where is Media
Headed?

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Media Industry Revenues

REVENUES IN INR BILLION CAGR

862 9.8%

734
660

594

369
5.7%
331
303
296
224
24.9%
151
119
92
34 37 43 7.7%
32 8.6%
24 26 28 34
2016 2017 2018E 2020E
TV PRINT DIGITAL OOH RADIO

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Media Advertising Revenues
REVENUES IN INR BILLION CAGR

368 11%

304

267
262 5%
243 238
216
215 204 23%

146

115
89

37 43
34 7.7%
32 8.6%
24 26 28 34

2016 2017 2018E 2020E

TV PRINT DIGITAL OOH RADIO

Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI
Source – FICCI-KPMG M&E Outlook, EY & FICCI Media Outlook, Zenith OptiMedia,
PwC Outlook, IRS 2017, Internal MIS, BARC, Kantar, Accenture, TRAI