Market Insight

Partnership of Amagi and BARC to push geo-targeted TV ad in India

November 25, 2016  | Subscribers Only

Kia Ling Teoh Kia Ling Teoh Senior Research Analyst – Advertising & Television Media, IHS Markit

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Targeted-TV ad network Amagi has announced a partnership with television viewership monitoring body Broadcast Audience Research Council of India (BARC) to monitor geo-targeted ad campaigns across TV channels. Feeds by national and regional channels split will be listed across BARC India’s interfaces.

Amagi was founded in 2008, with the capability to enable different ads in different regions on the same air-time band it has bought on a particular TV channel. It works with 25 channels including Zee TV and Colors.

BARC was formed to provide a more reliable television audience measurement system for India, promoted by the three key industry stakeholders, (broadcasters, advertisers and advertising and media agencies). Its first set of TV ratings was released in April 2015. 

 

Our analysis

IHS believes the BARC-Amagi partnership will spur geo-targeted TV ad spend in India and further bring regional markets into focus.

Geo-targeted advertising is feasible in a sizeable and fragmented TV market like India. According to IHS, there were 170 million television households in India (the US had 119 million) in 2015. The South Asian country has 29 states and 22 registered official languages; television broadcasting consists of hundreds of national and regional channels.

 

The integration of national and regional channels in the Indian TV market is commonplace with major national players such as Star India and Viacom18 acquiring regional channels to add into their portfolio. Recent BARC’s reading also showed ratings of major Tamil and Telegu regional markets eating into the pie of national Hindi channels.

To advertisers, the Amagi/BARC partnership will offer the ability to evaluate advertising performance and thus, allow media optimization and in theory, reduce ad wastage. It is particularly useful for brands with smaller budgets and specific target demographics, who normally cannot afford large TV campaigns. If the partnership is successful, advertisers are expected to fine-tune their media targeting according to geography-specific consumption patterns and focus on regional targeting and move some of their performance budgets to TV.  

However, there are several challenges BARC and Amagi will face as they tackle addressable TV advertising. Firstly, broadcasters' fear of traditional ad sales cannibalization in favour of geo-targeted advertising, especially for regional networks will hinder openness in accepting the new measurement standard. Secondly, Amagi is competing with the largest broadcaster Star India which controls 39% of Indian TV revenues, according to IHS Markit analysis and so Star India may wish to create their own separate standard for geo-targeted advertising. The 21st Century Fox-owned broadcaster launched AdSharp to offer geo-targeting advertising in 2014. Star India enjoys a wider reach especially on key genres Hindi general entertainment and holds major sports broadcasting rights including Cricket World Cup. Thirdly, Amagi’s position in the ecosystem might raise questions about the independence and objectivity of the measurement, which is critical to data credibility. 

Despite the above challenges, this is one of the first global efforts in marrying panel and census-level TV data. There are other initiatives globally (e.g. BARB's Dovetail Project), but nothing has yet been translated into actionable data for advertisers and media planners to measure their campaigns against universally. IHS Markit expects this partnership to unlock new ad budgets for Indian TV and more networks like Sony Pictures (which is expanding its sports portfolio in India), to jump onto the bandwagon of geo-targeted ads to improve their monetisation efforts in India. 

Research by Market
Media & Advertising
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