Last week, Bennett Coleman & Company Limited (BCCL) announced a hike in the ad rates of its various newspaper brands by 8–10 per cent. BCCL justified the same by citing increased investment in “content, copies, distribution and technology” to deliver value to readers and innovate constantly. Besides leading dailies such as The Times of India and The Economic Times, BCCL also publishes Navbharat Times, a popular Hindi daily with an estimated readership of 27,36,000 as per the findings of Indian Readership Survey (IRS) 2014. The study pegged the readership of TOI and ET at 75,90,000 and 8,34,000, respectively.
The Times Group, however, is not alone in taking an aggressive position vis-à-vis pricing in the new financial year. Interacting with exchange4media, a number of newspaper groups indicated an increase in advertisement rates. Following the jolt that the industry was handed out, courtesy demonetisation, print media now appears to be in a power-play mode with the revision of ad prices on the cards. According to the Pitch Madison Advertising Report (PMAR) 2017, the Indian print advertising market will grow by 9.5% in the current year and will be valued close to Rs 20,000 crore.
Dainik Bhaskar Group is one of the foremost print media players in the country bringing out seven newspapers with over 60 editions. Noting that the “business was hit from November to February,” Girish Agarwaal, promoter director at Dainik Bhaskar, sounded excited and hopeful about FY’18 after an average performance in the month of March. “We generally increase our rates by 8-10 percent. This year, because of demonetisation, we may increase it by around 5 per cent,” said Agarwaal.
Maintaining that most of the sales growth in advertising categories is coming from tier 2 and 3 cities, he urged marketers to look beyond metro cities. Referring to an Ernst & Young report, he claimed that besides 8 metros, 40 mega cities will drive growth in the country, which is a huge area of opportunity. “Out of these 40 cities, we cover 23 very effectively,” Agarwaal added.
If one does a comparison between HT Media, the company behind dailies such as Hindustan Times, Hindustan and Mint, and BCCL, there does appear to be a difference in approach between the two as far as ad rates are concerned. Speaking to exchange4media, Rajeev Beotra, CEO of HT English, stated that “there are no longer any rate cards” in the industry with media companies perennially monitoring pricing. “HT Media is evaluating pricing closely across all products including digital,” said Beotra specifically in relation to his company’s plans.
Though Dainik Bhaskar and HT Media admitted their respective positions on record, Dainik Jagran refrained from doing so. An official email and several text message reminders to top Jagran executives failed to elicit a response. Like HT Media, Jagran Prakashan Limited too is a listed company. Dainik Jagran, the company’s flagship print publication, stood atop IRS with a readership of 1,66,31,000 in 2014.
An inside strategist revealed to exchange4media that Jagran revises its ad rates annually in the beginning of the financial year. Unsure of what lies in store ahead, the source added that a decision could be arrived at by April 20 with the management taking the final call.
Given the size of the country, it does not come as a surprise that the so-called national market leaders cannot match the might of regional print giants in many geographical locations. One such place is Kerala, the most literate state in the country, with Malayala Manorama being its most read newspaper. On April 1, the Malayalam daily increased ad rates across its 11 editions by 10 per cent.
Justifying the increase in pricing, vice president Varghese Chandy said, “Everything in the world goes up but everyone wants newspapers at the same price that they were sold 10 years ago.” He added that Manorama had “grown by 100,000 copies in the last one year” reaching out to 2.5 million readers. The circulation growth, which was termed as “organic” by a senior employee, gave Manorama management the confidence to revise advertisement rates. “We offer the best cost per thousand (to advertisers) comparable to other newspapers in the country so there is a justification for the increase in ad rates,” claimed Chandy.
Three months ago, Rajasthan Patrika, another dominant regional player, did the same. From January 1, the 21 editions of the newspaper increased the ad rates by approximately 10 per cent. Following the launch of Patrika TV in February, the newspaper has embarked on a “multimedia approach” and is “coming out with radio stations,” a source said.
The word, which emerged out of Amar Ujala, was that “discussions are on” pertaining to price revision and nothing has been decided yet. Claiming that the “industry is going through abnormal kind of discounts,” an Amar Ujala official batted for the necessity of price revision. The official felt that it was much easier for a newspaper like TOI to increase ad rates since they operate in the national market whereas Amar Ujala is a force to reckon with in Uttar Pradesh, a largely unorganised market. If one is to go by what this officer said, Amar Ujala can be expected to make up its mind in relation to ad rates in “another week or 10 days” time.
Having remained a favourite of newspaper readers in eastern India, The Statesman is presently trying to make inroads in northern India through an early edition focused on states such as Punjab, Haryana, Uttar Pradesh and Uttarakhand. But times have changed. “In the current market scenario, print is not getting much of a response as far as ad revenues are concerned,” said Rakesh Sharma, national sales head at The Statesman Limited.
Identifying the shift in ad spends towards digital as one of the reasons behind the crisis faced by print, he argued that newspapers could either “increase ad rates or increase ad volume” to remain in business. Under Sharma, The Statesman has opted for the former. “We have also increased our ad rates by 15-20 per cent,” he mentioned. As publisher and editor-in-Chief of The Millennium Post, Durbar Ganguly opined that newspapers such as his and The Indian Express have a niche audience where the opportunity to meddle with ad rates was limited.
“The newspapers which are in a dominant position such as The Times of India can take such a decision but for medium-sized newspapers, the scope is limited,” said Ganguly. According to him, when advertising volume is less then advertisers tend to not look beyond the newspapers which occupy the first and second position. Despite the lack of opportunities, Ganguly conceded that he will consider revising rates at some point in time.
He observed that a large number of advertisers who were with them in the first year disappeared during the second financial year. As a result, there is a need to scout for other options. “We have been trying to cater to and attract more advertisers,” he added. Bringing an editorial perspective to the entire debate around ad rates, veteran newsman Prabhu Chawla urged newspapers to follow the example those who had hiked their prices.
Arguing that “news is being subsidised” for consumers at the moment, he wished that both advertisers and consumers paid for it. “Compromises are being made by the owners and editors to improve the bottom line,” said Chawla, editorial director at The New Indian Express. Instead of compromising on ethics, he found increasing ad rates as a suitable measure to maintain profitability.