In the first half of 2011, print media advertising grew by 16% over the same period last year, according to the latest TAM AdEx data, based on column centimeters. Advertising in newspapers accounted for as much as 96% of print advertising, with magazines making up the remaining.
This was in keeping with the trends in 2010, which showed print magazines — especially general interest magazines —recording a dip in advertising and circulation. Business and niche magazines, however, are growing.
In 2010, print advertising remained the largest segment at 46%, followed by television at 41%, according to the just released India Entertainment and Media Outlook 2011 report by PricewaterhouseCoopers (PwC).
Industry experts predict that print media will continue with their growth story and possibly also remain the largest advertising segment till 2015, though some say that TV will overtake it by that year, but print’s share will still remain significant. After that, some say, the medium will begin to feel the digital heat, while others say not yet.
Jai Lala, principal partner, The Exchange, Mindshare (India), said: “According to our evaluation, print will grow at 9% this year and TV will overtake print in ad revenues, as it is growing faster.” But he agreed that print will remain significant, especially as newspapers spread their presence into smaller cities and towns, both in the English and regional languages. Mindshare is a leading global media agency.
Timmy Kandhari, India leader – entertainment & media practice, PwC, said: “Print is currently growing at 9%, while TV is growing at 15%. With print, however, the growth of literacy levels is bringing in new subscribers and as newspapers go regional and rural, they will grow the segment.”
Depending on whose numbers you accept, India has bucked global trends (the US, UK) in newspaper growth, being the leading — if you accept KPMG’s figures — newspaper market in the world with 10.7 crore copies circulated daily, ahead of China and accounting for over 20% of dailies all over the world. If you accept PwC figures, India is the second largest newspaper market in the world with a daily circulation of nine crore copies, trailing China’s 13 crore.
Largest or second largest, India is nonetheless a highly impressive print media market. According to the FICCI-KPMG Media and Entertainment Report 2011, India has a staggering 77,600 newspapers in several languages, including English. And in 2010, there were 613 pending newspaper requests for registration.
With regional language newspapers picking up, the expectation is that the predominant skew of advertising towards English language dailies will dilute as ad allocations will even out among the English and regional language dailies. Currently, while English language dailies command 9% readership of all dailies, they pull in almost 50% of newspaper advertising money. English newspaper advertising comes at a premium over regional language dailies.
LV Krishnan, CEO, TAM Media, observed: “There are perceptual (that English speaking urban consumers have higher spending power) and qualitative reasons for the ad skew. As advertisers get to know more about the Indian language dailies — their ownerships, readership lifestyle patterns — they will advertise more with them. But while language newspapers will grow in readership, English papers will also grow as more youngsters learn English at school and media — TV, online — bring in more content in English. English language newspapers will continue to maintain their power ratio.”
KPMG expects that in 2011, English dailies will get 40% of the newspaper ad spends, while Hindi and vernacular dailies will get 30% each.
“For the next five years, English language dailies will dominate ad rates,” PwC’s Kandhari predicted.
Lala analysed: “While the proliferation of print into tier II and III towns and beyond may be happening, metros will remain at the top of the readership and ad target pile. English newspapers will continue to dominate ad allocations, though the gap may reduce in time. But that would take over 10 years, when all markets expand.”
While newspapers continue to grow strongly, magazines, especially the general interest ones, are declining in readership and ad spends. Lala said: “Newspapers give advertisers reach. With general interest magazines that are mostly weekly, the biggest issue is the news is old. Besides, even newspapers have introduced magazine formats.”
But business and niche magazines are growing. “For advertisers, SEC A+ targeting becomes possible across specific areas of interest. The revenue model for niche magazines are dual — subscription and ad revenue,” added Lala.
Going forward, newspapers will continue to remain heavily advertising-dependant since competition and the need to expand their presence will ensure that cover prices remain controlled, or even reduced to garner faster penetration in new markets.Krishnan pointed out that even as newspapers are ad-dependant, a lot more categories of advertisers have emerged. "Ten years back, the dominant advertisers in newspapers were durables, telecom and finance. Today there are new sectors such as education, healthcare and social communication that are prominent in print."
Finally, digital media still remain the one sector that could impact the consumption of print. Lala pointed out: “Most major publications have already introduced their online versions, so digital growth will not be adverse for them. Most general newspapers are free online, while niche publications — Time, Newsweek — are paid. There are advertisers who are already looking at news apps for advertising online. The Economist has appointed special sales people in India for digital sales. Online ads can be interactive, offering better monetisation to online publications.”There is no firm agreement on when this transition will actually happen. Experts say that the broadband infrastructure has to first be in place for the online impact to be felt significantly in a country as large and populated as India. Besides, there is one view that insists that new media will supplement traditional channels for distribution of content.
The FICCI-KPMG report expanded this view, stating: “Companies will adapt formats and delivery platforms for content and build communities of loyal consumers… [In] the technologically advanced Japanese market…91% Japanese news readers continue to read daily in print form.” The report added that Japanese consumers consider print news more reliable and are willing to pay for their newspapers.