Print medium generated Rs 2,186 crore more in 2010 to its share of Rs 7,806 crore in 2009. But actually, itâ€™s not a growth story. It is a story of recovery if we compare it with the figures of 2008, when the medium had ad revenues worth Rs 9,825 crore. In 2010, it is marginally better at Rs 9,992 crore.
The medium had seen a negative growth of 21 per cent in 2009. Taking a cautious approach, the Pitch Madison Media Advertising Outlook 2010 had given the medium a chance of eight per cent growth rate. But, in actual, the medium saw a growth of 28 per cent in 2010.
If the Diwali period in 2009 sounded the death-knell for the medium, the Diwali period in 2010, signalled the recovery. HT Media reported an advertising growth of 20-25 per cent during the October-December period, as compared to the period in 2009. The growth was led by cut in discounts on advertisement tariffs, which are back to 2008 rates.
Similarly, Jagran Prakashan too showed a growth of 31 per cent YOY in ad revenues in quarter three of the current financial year.
Dainik Bhaskar Group in the nine months of 2010-2011 has grown in advertising revenue by 29.2 per cent.
The local edge
So the year 2009 was not an aberration when television overtook print to emerge as the largest shareholder in the ad-pie. The norm is here to stay and print will have to play second fiddle to television, in spite of the tremendous growth rate it saw in 2010. The print medium also managed to increaseÂ its share in the ad pie marginally by 0.5 per cent against our projections of a loss of 1.7 per cent. That said, it did manage to eat into the share of television.
To say that television has grown and is now competing with print, is a statement that Sanjay Gupta, CEO, Jagran Group and Editor, Dainik Jagran, is not in agreement with. â€œThe USP for print still remains local advertising coming from smaller cities that gives us the edge over television. Television cannot be penetrative, especially in local retail. It is not practical for any local retailer to go on national television.â€ he says, adding, â€œThough most of us in this space are national titles, we are extremely local in nature too.â€
Citing reports from TAM AdEx, Gupta feels that of the 650 odd categories reported in TAM Adex, there are around 450 which have a print skew. The other medium that is successful in this is radio, and it complements print in a sense. â€œThough even in radio, the national advertisers block most of the inventory, so you still do not see as much local advertisers, as the inventory in radio is fixed,â€
Sanjeev Kotnala, VP, BrandComm, Bhaskar Group, adds, â€œPrint is having an exciting time. Print has an advantage of information sharing and tuned response. Add to that the possibility of tweaking â€“ adapting â€“ time taken to react in the dynamic era of brand opportunities, is making all categories have a re-look at their plans carefully. Meanwhile, television communication always remains an intrusion in viewing
According to Arun S Natesh, Head – Marketing, Business Standard, the other reason for printâ€™s depleting share in the ad pie are the big events like IPL, World Cup and reality shows, being covered by television. â€œIf print holds onto its share, that itself will be commendable,â€ he says.
Brand building or tactical
The argument held by print leaders holds true for campaigns that are tactical in nature. While three years ago, print was being used for brand building as well, major corporates are skewed towards print only for tactical advertising. For example, Maruti Suzuki, till three years ago had 65 per cent of its ad budgets for brand building ear-marked for press, which it today spends on television. Shashank Srivastava, Chief General Manager, Marketing, Maruti Suzuki, says, â€œIf you exclude the tactical advertising at local level andÂ see only the brand building part, television is much more important than press and our expenditures
reflect just that.â€
Space vs revenue
Newsprint used for advertising too has increased considerably. As per AdEx, on an average, a publication used 3.2 lakh (column centimetre) for advertising in 2010. The figure excludes in-house ads. Considering that the average CC used in 2003 by a publication was a mere 1.6 lakh, the ad industry has come a long way. However, considering that the CC/per publication was on the up during the slowdown period, and revenues were down, it is an indication of how much discounting the newspapers gave on their rate cards. Match these figures: In 2008, when the advertising CC/publication was 2.5 lakh, the revenues stood at Rs 9,825 crore; in 2009, the CC/publication went up to 2.8 lakh, however, the revenues dipped to Rs 7,806 crore; in 2009, and in 2010, while revenues are marginally better than 2008, advertising CC/publication has shot up to 3.2 lakh.
Education through newspapers
For the past five years, education has been the top advertising category in print, increasing its share up to 17.3 per cent in 2009. While, it still is the top spender on print, its share has considerably come down to 14.6 per cent in 2010. BFSI, which contributed a share of 10.6 per cent in 2006 and had taken a dip along the years, down to 7.9 per cent is again emerging as the top advertising category in print, with a contribution of 8.7 per cent in 2010. Real estate with eight per cent share is the third top most advertising category in print.
FMCG, while remains the top most advertiser on TV, it also is fast emerging as one of the top-spenders on print. From a contribution of 5.8 per cent in 2008, FMCG contributed 7.4 per cent to the print advertising in 2010, with â€˜personal careâ€™ contributing the most. However, the difference in the ratio between revenue vsÂ volumes for television and print could be quite opposite. According to Shantanu Bhanja, VP, Marketing, HT Media, largely FMCG is dependent on television. Considering the volumes it brings in â€œFMCG is able to negotiate better on television, hence the numbers for volumes and values could be contradictory. Ironically, most media companies have no way out getting to real value.â€
The year saw the print medium getting quite innovative. The Volkswagen â€˜talking adâ€™ in The Times of India and The Hindu created a lot of buzz for both the newspaper and the brand. The innovations eventually are a signal of the times to come and the blurring lines between the different mediums. Mid-Day has been for quite some time using the QR Codes to link up the newspaper with the mobile phone. Mid Day also had some of its ads in 3D. Later, Hindustan Times had its Real Estate section entirely in 3D.
Similarly, Delhi Press did content innovations in seven of its publications for Star Plus, when the channel went under a rebranding phase. â€œWe did interviews, coverage of Star serials, besides other for Star during the period,â€ says Anant Nath, Director, Delhi Press.
Print, according to Kotnala, is a medium of flexibility. â€œIt allows instant message dissemination, instant hype build up and logic. There is a new found experimentation with print; creative teams know that their ideas can be executed to perfection. They are realising the possibilities. Itâ€™s â€˜You think it – we print itâ€™,â€ he says.
But innovations can be intruding and disturbing for the reader.
According to Bhanja, Hindustan Times has drawn a strong line on what is friendly and non-friendly to the reader. â€œInnovations like a hand-written newspaper, or value-adds like a set of magazines, wellness guides, career guides are beneficial for both the advertiser and the reader.â€
Maheshwar Peri, Publisher, Outlook agrees with Bhanja. Outlook brought a Travellerâ€™s Guide in association with Maruti Suzuki. â€œSuch innovations have a shelf-life and are liked by the readers and the brand advertising or sponsoring the value-add finds stickiness with the reader,â€ says Peri.
In spite of the growing discontentment with innovations, why are they a norm? Natesh isnâ€™t sure if innovations are a norm but he feels publications do feel pressure from media agencies. â€œI donâ€™t know if innovations will be a norm, but you can see more and more agencies choosing vehicles, which will innovate as per their specifications rather than a vehicle which will deliver the audience,â€ he says.
If innovations attract eyeballs, they come at a premium as well, and that means more ad revenues. â€œInnovations always bring in premium. That is the reason why publishers are willing to go ahead with them. The premium on innovations are justified on the grounds of extra cost that we incurÂ for executing them, the greater exposure that the advertisers derive from them, and the price for the reader discomfort that an innovation induces,â€ says Nath.
Delhi Press has devised a pricing matrix for calculating the price of innovations that is based on three factors â€“ cost, exposure value, and reader interest erosion. â€œIt is not an exact formula, but is does lend some rationale for arriving at the price,â€ he adds.
Add to that the time needed for planning, says Kotnala. â€œInnovations normally demonstrate a new approach to interact, breaking at times rigid constraints of past. They always need additional planning, time and skill and disrupt the processes. Itâ€™s worth the pain for higher level of brand involvement. By nature they cannot be rate carded but an understanding of the medium can lead to experiential learning to estimate possible cost,â€ he adds.
In spite of the detailed coverage, and analysis and stories that have shook the government and the media industry itself â€“ the 2G scam and Radigate cases in point â€“ magazines have not been doing well as far as ad revenues are concerned. The share of magazines has been ever declining in the print ad pie. From a 10.2 per cent share in the print ad pie, the magazines share was down to 4.6 in 2009. In 2010, it further tanked 0.4 percentage points.
According to Peri, while general interest and business magazines from the Outlook Group did grow at a rate of 25-30 per cent in 2010, â€œthey still are not at the growth levels of 2008. It will take another year to be at par or ahead of 2008.â€
Nath too has similar sentiments to share. â€œWe grew by around 20 per cent in 2010, whichÂ compared to our growth of 25 per cent in 2009, is lesser in terms of percentage growth,â€ he says. However, he is happy that the growth â€œstill translates into a larger absolute growth.â€
For Outlook, much of the growth has come from lifestyle, airlines and travel & tourism. Also, â€œthe retail boom has added to the growth. Stores like Madame would surely come to a magazine rather than a daily,â€ says Peri.
For Delhi Press, the growth has come from personal care and television channels.
So how are publishers tackling the issue. Peri feels that the future is in special interest magazines. As compared to the general interest or business magazines, the growth of special interest magazines from the Outlook Group was stupendous. â€œWhile Marie Claire grew by 30 per cent, People grew by 90 per cent. The highest growth for some of our publications is 100 per cent,â€ says Peri.
Similarly Conde Nast Indiaâ€™s publications (GQ and Vogue), according to Oona Dhabhar, Marketing Director, Conde Nast India grew by 30-35 per cent in 2010 as compared to 20 per cent in 2009. â€œWith the growing affluence and interest, there are more opportunities to launch more specialised and special interest publications,â€ says Dhabhar, adding, â€œWith new interests and hobbies that people are gaining, there is opportunity of significant growth in the magazine industry.â€
Conde Nast also brought out its travel magazine, Conde Nast Traveller, to India, a couple of months ago. Other international magazines to hit the Indian shores in 2010 are Lonely Planet, Fortune. Meanwhile, Disney Publishing Worldwide has inked a deal with the India Today Group to bring its publications â€“ Disney Princess, Disney.Pixar Cars, Art Attack, and Disney Junior to India.
So howâ€™s the print industry expected to fare in 2011? Will it be able to sustain the growth or will it succumb to the pressures of television and growing internet? Find it out in the Outlook section.