Hoarding Tragedy. Brands and billboards: Will marketers rethink outdoor advertising?

The Mumbai billboard crash has shaken up the advertising industry. Will brands be reluctant to spend on the outdoor medium now? Even as the Brihanmumbai Municipal Corporation (BMC) seeks structural audits on hoardings, most marketers and agencies feel that the tragedy won’t impact the out-of-home ad business.

Says Abhijit Sengupta, CEO, OAP Mediatech, a specialist outdoor advertising agency, “As BMC takes down hoardings in certain regions, it will not necessarily affect advertisers because in cities like Mumbai, there is a demand-supply mismatch, with demand being substantially lower than the supply. Around 15-20 per cent of the hoardings coming down won’t materially change our circumstances.” He adds that outdoor advertising agencies and brands are also becoming more conscious of ensuring that the hoardings they advertise on fulfil safety guidelines.

Most of the industry folk that businessline spoke to believe that billboards and ambient ads are an integral part of the urban marketing playbook. While increased scrutiny in the short term is to be expected after the collapse of the billboard in Mumbai during the May 13 storm, that scrutiny will not necessarily translate to brands stopping billboard advertising.

Explains Ajimon Francis, Managing Director at Brand Finance, “Most of the public scrutiny is directed towards civic bodies and not the brands itself. To assuage public concern, municipal corporations might relook guidelines. Brand image in and of itself will be largely unaffected.”

Experts also believe that civic bodies are unlikely to eliminate these hoardings altogether, especially as they are usually owned by people with powerful connections. Moreover they also contribute significant revenue to local governments. According to reports, Mumbai has 1,025 licensed hoardings that contribute ₹100 crore a year to the BMC exchequer.

As Francis says, “In a city with high density urbanisation like Mumbai, hoardings are integral for advertising. People are always on the move in the city and thus exposed to them. Companies use them to announce IPOs, movie releases, opening of new storefronts and many more things. Billboards are even more integral for marketing in tier 2 and tier 3 towns, where infrastructure companies, jewellery stores, use these hoardings.”

But there are people like D Ramakrishna (Ramki), founder and creative director of Cartwheel ad agency, who express reservations about the medium. He says, “At a point the industry has to have a conscience which is less commercial. As creative people we will find a way to advertise even without the hoardings. It has been done before in cities like Chennai, where hoardings were banned and we found a way to create interesting campaigns.”

According to the FICCI-EY Media report released in March 2024, the out-of-home media segment grew by 13 per cent in CY2023, valued at ₹46.6 billion and is expected to reach ₹54.3 billion by the end of 2026.

Karan Taurani of Elara Capital adds however, “The banner advertising has been struggling to grow in the post-Covid era. In light of the poor infrastructure and increased scrutiny by the government, it will have a negative impact on this segment.”