Much like the rest of the news media industry, Delhi Press, the publisher of 36 magazines, has been facing demonetisation woes. As per the economic data released by the Central Statistics Office (CSO), the Indian economy will grow by 7.1% during the ongoing fiscal. To the surprise of many, CSO estimated that the GDP grew by 7% in the third quarter from October to December 2016. It was during this period that Prime Minister Narendra Modi announced the demonetisation of high currency notes leading to nationwide economic uncertainty.
“Even though the government data shows that there is hardly any impact, we believe that there will be a big impact as far as non-essential items are concerned. Unfortunately, magazines have become non-essential items,” said Paresh Nath, Publisher, Delhi Press. Explaining the difficulties faced by publishers, Nath noted that they were disturbed at both ends during the months of November and December.
While the consumers did not have “enough money to buy magazines” owing to the scarcity of cash, advertisers were pulling back on their purchases. Speaking particularly in relation to fast-moving consumer goods (FMCG), he observed that the dearth of customers at kirana shops resulted in FMCG companies “restricting their advertising” expenditure.
According to Pitch Madison Advertising Report (PMAR) 2017 released in February, FMCG companies cut down on their advertising expenditure by 25% during November and December. This led to the shortage of nearly Rs 500 crore worth of advertising from the side of FMCGs. If one is to go by PMAR 2017 figures, FMCG adex went down from Rs 1,924 crore (Nov-Dec, 2015) to Rs 1,435 crore (Nov-Dec, 2016).
Preparing to deal with the crisis at hand, news media organisations initiated cost-cutting measures which were also replicated at Delhi Press. “In any enterprise, these things are done automatically. When cash is not coming, you don’t spend cash also,” Nath stated. As the government kept changing rules in relation to the exchange of old notes and cash withdrawal limits, print media giants like ABP and HT Media let go off a significant chunk of their workforce.
Supporting the notion that demonetisation was to blame for the tough measures, Nath said, “I will agree to that. Lots of time was spent standing in lines instead of cultivating reading habits.” Being critical of the chorus surrounding the emergence of a cashless economy, he argued that a large number of people in the country do not even have a bank account leave alone a credit or debit card. As the situation limps back to normalcy, he agreed that the annual financial results will “to some extent” be impacted due to demonetisation. “Bringing back the customer’s reading habits will take some time,” he said.