Slowdown In Realty Advertising

If you thought that only the real estate values are witnessing a dip, think twice. Even the advertising industry is also feeling the realty heat.

According to industry sources, it is estimated that all major developers such as DLF, Omaxe, Ansals and Parsvnath have decided to cut down on their advertising budgets by around 5 percent. The advertising industry in India is estimated at Rs 10,000 crore.

While analysts attribute this trend to dampening spirits of potential buyers, real estate companies prefer to call this a reality check on their advertising budgets. A report from Adex India, a division of TAM Media Research, shows that the share of real estate advertisements in print media saw a drop of 2 percent during 2007 compared to 2006. According to Adex, the share of real estate advertisement in overall print and TV advertising last year was 4 percent and 1 percent, respectively.

According to S K Sayal CEO, Alpha G Corp: “Infrastructure and real estate companies have primarily been responsible for the advertising industry sustaining its double-digit growth rate. However, in general, companies and brands have been increasing their expenditure on advertising. But a recent dip in the realty sector has made things worse for the advertising industry. Many real estate companies, this fiscal, have cut down on their advertising budgets.”

The Adex report indicates that the top 10 advertisers shared an aggregate of 16 percent of overall ad volumes of real estate advertising in print during 2007. The list include names such as DLF Group, Parsvnath, Sahara, HDIL and Omaxe group. However, the real estate had maximum share in South India publications followed by North and West publications with 32% and 26% share, respectively, during 2007.

“This is because all real estate companies want a national footprint. Also, these companies are now turning professional. They’re setting standards when it comes to managing their A2S (advertising to sales) ratio,” says Jagdeep Kapur, CMD, Samsika Marketing Consultants.

3 Comments

  1. Posted June 26, 2008 at 7:35 am | Permalink

    Many real estate agents brokers giving discounts by reducing their notional profiles. In such case Real estate builders also has to deduct their budget on advertisement.

  2. Posted July 16, 2008 at 6:24 am | Permalink

    Yes it is feeling that lot of projects are running at current in all the states which have to be buy very difficult.Main reason is that from the time where banks rate of home line hikes the property is becoming in the downfall.Advertising is going to be on faliure which have to be bad impact to sell the flats and houses

  3. Posted July 18, 2008 at 6:45 am | Permalink

    Rising interest rates and a falling demand may dent the realty market in India. However, the long-term prospects for the sector continue to be good, feels the industry. There are around 21 India-dedicated real estate funds that are raising money in the international market. In the next nine months, nearly $7 billion will be entering the country through various India-dedicated funds. While long-term players are looking at India, short-term players based in the US and Europe, such as the hedge funds and private equity players, are more interested in their local markets.For more view- realtydigest.blogspot.com

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