Of Peaches and Potatoes

MINT’s - perhaps - the only paper (business or mainstream), which has been consistently covering the print-media and issues related to it. In my earlier posts, I have referred to some of the articles it has published. This Saturday (December 27th) edition carries a piece by Ashish Bagga (CEO, Living Media) – as a part of its series on ‘2009 Trends Predictions’ (click here to read article).

It is sort of a ‘laundry list’ of several possible fall-outs – some obvious (lower pagination, falling ad revenue, lower ad-edit ratio, ‘right-sizing’ of manpower etc) but others not so apparent and hence more interesting.

First, Bagga talks of consolidation across businesses that were so far working in silos to exploit synergies. He rightly points out that both systems have their merits but under revenue pressure there is a greater urge to unify structures.

Focus vs.Scale

Obviously the reference is primarily to the Media Marketing teams and the Circulation Sales force. This is a classic conundrum I have seen in many organizations. While having a common sales organization is probably simpler (and most companies have it anyway), the real dilemma arises when it comes to ad marketing. This is more so – when you have separate “Business Heads” for different publications or ‘divisions’ within the group or ‘house’, as some prefer to call themselves. The debate always centers round “focus” vs. scale or synergy – and, tends to heat up when ‘accountability’ for ‘bottom-line’ rests with the so-called Business Head – and the responsibility for ‘ad-revenues’ is with someone else, who usually reports directly to the CEO. Under such a system – the Business Head feels naturally dis-empowered and accusations of the smaller / niche publications or divisions being ‘short-sold’ begin to fly. In reality, however – it’s often the other way around. When the smaller or weaker publications are sold on the back of the flagship brand – it is usually at the expense of the bigger or mother brand / edition which end up subsidizing its smaller (or younger) siblings. In a game of accounting “allocations” - the revenue apportionment goes in favour of the brands or editions, which are being supported (especially – say, if it’s a new Brand or a new city Edition which has just been launched).

Tonnage vs Grammage

Parallels are often drawn with the FMCG industry – where the same Sales system is used to market brands and products across divisions or profit-centres. While the comparison may hold somewhat true – as far as Circulation Sales is concerned it could be fallacious to extend it beyond that to ad-marketing. Even in FMCG – the debate has raged on for years. The comparison is not just between the proverbial ‘apples and oranges’, but as a legendary Marketing ‘Guru’ of Hindustan Lever had once put it very pithily – it’s very often between “peaches and potatoes” – tonnage vs. grammage ( read niche publications). This would apply particularly to new fledgling brands, which have to be nurtured with care. But then, as Bagga says – in the current market scenario very few companies would have the luxury of launching new publications or editions. And, for that matter nurture the un-profitable ones.

It would be interesting, however, to see if the same logic of consolidation and exploiting synergies would now get extended even to other areas of operation such as the newsrooms and news-gathering.

(in the next post I intend discussing some of the other very relevant issues raised in the article)

Say cheese !!

I generally tread clear of the Capital’s lecture and talk-show circuit. But, yesterday I accidentally gate-crashed into one. The occasion was the launch of the Business Standard India 2009 – a collection of essays on contemporary economic issues facing the country.

In a gathering of very distinguished economists and policy makers, as a part of the panel chaired Montek Singh Ahluwalia and T N Ninan as moderator - Bimal Jalan, the former RBI Governor, was at his provocative best. He was reveling in baiting the media, who he accused of over-selling the India Inc Rising story. He argued that, it wasn’t that the Indian economy that was running too fast but the Indian Stock Market that was being driven recklessly. When the real economic growth was at 13% - fuelled by tax arbitrage, the stock market was giving returns of 80% - but no one questioned the disconnect. We can excuse a Sarah Palin – who had never seen India on the map – wanting to invest in India because she saw India all over the media but we should have known better, he joked. He also had a dig at the “entrepreneur” (no prizes for guessing) known to run a half-marathon every morning, who had raised Rs 20,000 crores from the market even before he finished his morning jog. When you run that fast there is always a risk of tripping and a correction was just waiting to happen. He chided the media for, having created euphoria earlier, now going to the other extreme predicting a dismal doomsday scenario.

Listening to Dr Jalan’s, I wondered if the media itself had fallen prey to the tales of its own creation. Over the last few days – everyone I have met from the print industry – be it from editorial or marketing - have been complaining how bad things are. And till the other day, media houses – new and old – were going about their business like there was no tomorrow.

This adventurism was not just restricted to starting new editions or jacking up circulation. There was actually serious money being put on the block in the form of investments in Fixed Assets (expensive high-speed printing presses) most of it funded by borrowings (except perhaps ToI who have always been known to sit on a mountain of cash reserves).

Add to that, the increase in pagination, internecine circulation wars (my ‘pet peeve’ of deep discounted - gift subscription offers), rampant under-cutting of ad-rates, over-the-top salaries of the new ‘whiz-kids’ on the block, across the board salary hikes and increased over-heads – you have the perfect story of cost-structure and business model going awry. And, if all this was being done with an eye on increasing company valuations for potential PE investors – someone got the math wrong – just as Dr Jalan said last evening.

The crash of the ad markets have really turned the screws on (even with softening of news-print prices), especially for the newbies and also some of the oldies who had taken a quick shot of viagra to feel young. By one account two of the new entrants in the Mumbai market were losing anything between Rs 50 to 100 crores per annum (depending on whose estimate you chose to believe). Despite drop in pagination and cutting down on print-order, thru’ non renewal of subscriptions etc they would find it difficult to sustain such high levels of “investments” (read ‘losses’) without big-time value-destruction, if the mother ship itself is under pressure. While those in it for the long-haul would definitely weather the storm – it’s those who were in the short term “valuation” game who would face the real heat.

So what’s the way forward? On the flight back from Delhi, I was reading in the TIME magazine how the Italian government has thrown a bail-out package for the cheese industry in the country. The government is buying 200,000 wheels of Parmigiano – Reggiano Grana Padano to be donated to charity. Possibly Mr Ahluwalia can take a leaf out of that book and devise a similar scheme for the Indian newspaper industry. It might make perfect economic sense – giving away free newspapers with free ads – to boost consumer demand. But, there’s just one glitch – thanks to the freebie offers very few people in India pay for newspapers anyway!!

Post-Script: Hopefully, after this crisis the Indian newspaper companies would find renewed merit in the age-old wisdom of having a more 'balanced' adverisement to circultion revenues ratio, which had historically helped them cushion the effects of cyclical downturns in advertisement. Till then, of course, the big consulting firms (Mckinsey, E & Y, PwC, Accenture etc) would make their pile doing 'cost-restructuring' exercises for the industry. Some I'm told are already on the job.

Flight of fancy !!

This morning on the flight from Calcutta – I was almost startled out of my seat, even before I had a chance to put my seat belt on, to see an announcement in The Telegraph. In a box item on the front page they informed readers that “to partially off-set” rising cost of news prints they were constrained to increase the cover-price by 50 paise (they went on to assure how TT is committed to delivering the best value to its readers etc, etc. On picking the ToI from the next seat – I found they had a similar notification ( but more simply worded – without any of TT’s almost apologetic note). One remembers that, such announcements were common in the 70s and 80s. But, in today’s day and age – when publishers have been tripping over each other in a game of “invitation pricing”, discounted subscription and freebies ( the latest I read was Nike shoe free with an annual subscription of a Delhi tabloid - read the Romantic Realist's piece by clicking here) – who could have imagined even a few months back that this was even possible.

Considering that a very high proportion of the circulation for most papers in metro towns are already locked up in one or two year subscriptions and ‘jodi’ offers, I am not sure how much this would yield in terms of additional revenues in the short-term. But, that such a move was undertaken (obviously, in unison by all the major players) considering that newsprint prices have actually come down from the peaks that it had reached a couple of quarters back, is indicative of the revenue pressures the industry must be experiencing at the moment. Paginations had already been cut-down over the last few weeks. In Calcutta I found The Telegraph had brought there Metro supplement inside the main-paper. The other day – someone traveling to Chandigarh told me that he was surprised to see the city edition of the paper down to only 12 pages. According to a totally unconfirmed (and, probably unreliable too ) source – the ‘old lady’ had posted a cash-loss for the first time in a zillion years last month. While this can well be malicious gossip – it is indicative of how ‘desperate’ the situation must be.

I am sure that the industry will tide out of this crisis – as the economy recovers (at least the industry ‘old timers’ – unlike the brave new ‘cow-boys’ –who invaded the industry lately – know newspapers were always a ‘cyclical’ business and they have seen many a down-turn in the past). But, for me there can be some silver lining in all this. First, it’ll put to test certain hypothesis on which many players have been punting in recent years: 1)Readers perceive greater value in higher pagination; 2)Selling it cheap means higher circulation and readership (put in simple marketing lingo – what’s the ‘price-elasticity’ of the product). And, most importantly – this should, hopefully, separate the men from the boys.

Well, I guess – like everything else – only time will tell. And, to know the outcome, you and I will have to keep reading newspapers!!

Cholesterol levels and Readership Surveys

I have really missed the bus on this one. I had meant to write on the IRS 2008 (Round 2) soon after it was released – but got caught up in my travels. Meanwhile, the ‘Romantic Realist’ and many others have literally beaten me to the post (Read RR’s Blog Post "I am No 1. No, I am No 1" in the MINT by clicking here). I had written much of my thoughts on Readership Surveys in India in 2 of my earlier Blogs Is it only about Eye-balls? and When adults act as kids. At a broader level, my views remain largely the same as I have also noted in my comments on RR’s piece (Read Comments at the bottom of RR's Blog by Clicking here).

Co-incidentally just the day before its release (on the 4th of Nov), I was chatting up a friend who has been on the Technical Committee of the IRS (MRUC) for many years. He made several very pertinent and interesting points. Here is a gist of our discussions.

Since the MRUC started as an initiative of Advertisers and Media Agencies (Brahm Vasudeva and Roda Mehta were the prime movers) – the IRS was conceived primarily as a Media Planning Tool. Therefore, the emphasis was not so much on the absolute “results” but more on the quality of the “research” – and, therefore, the underlying data, which would provide users insights for their media planning.

However, publishers has come to see it more like marks scored in a school or college examination – therefore, go to extra-ordinary lengths to ensure better “results” – especially after the NRS went into hibernation and IRS became the primary currency for print-media.

It’s common knowledge in the industry that, most organizations have their own “experts” ( read ‘fixers’) – who claim to be ‘specialists’ or past-masters at obtaining better results for their respective publications. Apart from using – old tricks of the trade such as distributing free copies around the time when the field work is conducted (this was developed to the level of a fine art with the level of sophistication that was applied to specially target areas where the survey was known to be happening - with information gathered thru’ moles in the data collection agencies), over time this was carried to a higher level with more blatant tampering of data. Industry insiders tell tales of instances – when field researchers have been apprehended ‘selling’ survey forms or caught in fisticuffs with goons engaged by publishers trying to obtain . While that could well be malicious gossip, it is widely believed that large media houses have a substantial ‘budget’ allocated for ‘managing’ – Readership Results – just as they were known to do for ABC numbers. (Click here to read Pramath Sinha’s piece published sometime ago in the MINT)


However, MRUC officials and the Research Agencies will vouch for the overall validity of the data. They claim to have built in a system of checks and balances that easily throw up aberrations during the process of data validation. In every survey – there are cases where a ‘back-check’ has been ordered or the data for certain publications have been withheld for publication – until the verification was carried out.

But in their over anxiety to obtain higher numbers, publishers often lose sight of more important underlying data. Moreover, in the process they also end up undermining the credibility of the survey – forcing Media planners and buyers to resort to developing their own customized metrics – which, with very small sample sizes, have their own set of limitations, claims of “proprietary” methodology notwithstanding.

It’s another typical case of shooting the messenger. So, what’s the way forward? The industry is already clamouring for the revival of their abandoned child the NRS. But, is there any reason to believe that- the NRS would produce results that are dramatically different from the IRS. Past experience doesn’t say so. It’s like me going to a different ‘Path Lab’ each time to check my Lipid Profile. It still doesn’t solve my problem of high Cholesterol and elevated hepato-bilary markers.

More later…..

Pleading Guilty & The Conflict within

Well, I am guilty of being remiss - not that I think I have been missed much. Actually - there is so much to write, with a maddening travel schedule - I simply couldn't find the time ( and, I didn't want to do injustice to the subjects - which I think are important and much of it based on first-hand conversations with very knowledgeable persons from the industry).

But, I intend making up for that soon. Meanwhile, I would commend to you the following article published in the edit-page of today's The Telegraph:

The Conflict Within - Reform Alone will restore the media's meaningful role : By R. Goplakrishnan

(check out the link: http://www.telegraphindia.com/1081201/jsp/opinion/story_10183628.jsp)

Gopal, as most of us know is a Director of Tata Sons. But also, as many may not know, he is a Director on the Board of ABP Pvt Ltd - the publishers of The Telegraph ( which the paper should have mentioned - in the interest of "full-disclosure", as MINT does in such cases). But, coming from him - the opinion is of great import, I think.

Read on....

The Tribulations of a Regional Giant

While passing thru Chandigarh last week (the thumbnail on the side is the official logo of the city-state, for those of you who have been wondering), I saw the imposing landmark of The Tribune at the junction of Sector 29 on Purv Marg and wondered if it would meet the same fate as that of once the pride of Chowrighee square in Calcutta – The Statesman House. In essence, I was thinking – what’s the future of regional newspapers with the large national players spreading their tentacles across the country.

I asked this question of a senior functionary of the paper – over coffee in the lawns of his lovely red-bricked bungalow, taking in a bit of the delectable early November sun with the first hint of winter. At first, he scoffed mildly with a smile (without any arrogance, I must add ) – “HT and ToI have declared that they are going to kill us or wipe us out several times over in the last few years, but we have managed to survive”. He then went on to admit rather candidly, that - while circulation and readership have remained largely unaffected and so has local advertisement – ‘National Ad’ Revenues have suffered. Typically, HT & ToI offer Chandigarh as an “add-on” in their national “package” at almost next to nil rates. This make media planners and advertisers re-think on the need to spend additionally on a local paper given the relative size of the market and the incremental reach it would provide. But, still they haven’t managed to cut-off the life-blood of the paper. Besides – The Tribune’s circulation revenues (which is largely at full cover price – unlike HT & ToI which sell practically all their copies on deep-discounted schemes) are healthy – which is also generally true of other regional biggies like The Telegraph and The Hindu.

So what should be the strategy going forward ? The Tribune has chosen one of creeping regional expansion – pushing the circulation boundaries beyond their traditional strongholds of Chandigarh, Punjab and HP. Now they have started crawling into parts of Uttaranchal, neighbouring patches of Rajasthan and spreading across Haryana – short of the NCR (Gurgaon and its catchment areas). Coupled with region specific customization of content – this has boosted circulation and geographic reach – which, apart from providing greater value to national clients, make them a more attractive proposition for Regional Brand players from Punjab and Haryana.

While this may hold the decline in the short and medium term – would it work in the long run. The answer to my mind, would be in fierce or ferocious localization of content – increasing interactivity and deliver across media platforms (Web, Mobile etc..) This would improve and thereby increase reader loyalty and customer stickiness.

By trying to play the game by the rules set by the competition and cloning them – it would end up becoming poor second cousins of ToI and HT – diluting its original character and also – in the process – losing its traditional constituents. In trying to work counter national predators and incursions by the web - many regional newspapers in the US have ended up going even more local with good effect. I was quite encouraged to hear from an young journalist in Shimla – how a voluntary initiative by some of them in starting a very local news web-site called “My HP” is beginning to gather momentum.

For marketers seeking to increase penetration – the ‘carpet bombing’ strategy of big newspapers won’t work beyond a point. When it would come to targeting the last consumer standing – a strong regional player would do a far better job.

In some ways – the coming few months could actually prove to be an opportunity for the likes of The Tribune. With newsprint prices skyrocketing and advertising revenues slowing down, the biggies might be forced to cut-down cheap unproductive circulation in less profitable markets. That’s when a strong regional brand can strike back with vengeance.

But that would mean a serious re-engineering of content, which may not be easy given The Tribune’s old guard editorial and conservative Board of Trustees at the helm of affairs.

So, I can only wish my friend luck !!

You are what you read or Ananda Bazar ki bollo?

One of the very interesting presentations at the just concluded WAN Conference in Amsterdam was from William Powers, the Media Columnist for the National Magazine in the US and the author of the essay on the enduring power of the newspaper titled Hamlet’s Blackberry.

He argues that the paper is an ‘island of peace’ in the age of ‘digital chaos’. Among other things, he argues, the paper “frees up the brain to think”. (Click here to read the gist of his presentation)

“Paper’s great strength is that it allows the mind to ‘settle down’ into that peaceful deep-dive state in which we do our best thinking. This state is much harder to achieve when we’re reading in the digital medium, where there is endless information, and so many possible tasks to undertake at any moment. On the internet, there is no beginning and no end.

Newspapers would do well to exploit these qualitative strengths over Digital Media.

Instead, “much of the media coverage of digital technology reads like product marketing. New digital devices are released, and journalists cover them the way they cover new movies. There’s a cheerleading to the whole exercise, an air of hype”, he said.

To me a newspaper is like a “sparring friend”. You enjoy talking to him, arguing or even fighting at times. And, that is not just a source of intellectual stimulation – but provides its reader a sense of identity. So, you have a paper like the Ananda Bazar Patrika in Bengal – its readers seldom agree with its viewpoint – whether on politics or sports (and, often take the nastiest jibes at it). Yet, they can’t do without or ignore it either – which led to their classic campaign “Ananda Bazar ki bollo ?” (what did ABP have to say)

Much as I would like to believe that's not who I am, I can’t but agree with the tag line of the new HT Café in Mumbai…..”You are what you read”!!

Newspaper Chart-lets and Multi-media Factoids

Later next week (October 16th-17th), the World Association of Newspapers (WAN) Readership Conference in Amsterdam (click here for details) will discuss the future of newspaper readership. Editors and newspaper executives from across the world will present and debate case-studies on strategies for growing newspaper and print audiences across platforms – print and on-line

.

WAN runs the “Shaping the Future of Newspapers (SFN)” project, which aims at helping newspapers with strategies to survive and thrive in a changing media environment. Appropriately, the theme of the Conference is “Newspapers can Increase Readership in Tough Times”.

One of the session titles that caught my attention was:

The New Newsroom: Broadcast, Print and Web – Newspapers, which are best at exploiting multi-media and competing effectively in the multi-media battle for audience and revenues;

Co-incidentally, only the other day I was watching the recorded web-cast of the Adobe CS (Creative Suite)-4 launch – where Adobe’s CEO Shantanu Narayen talks of precisely this seamless 2 way migration from print to web, mobile etc which is going to characterize the media universe in the days to come. CS-4 tries to integrate the creative process across all media platforms. (To check full video click here)

Another topical issue that would be discussed at the conference is how newspapers are working for attracting and retaining young readers of newspapers in a digital world – sometimes using Social Networking.

I have often wondered if in our frenzy of chasing circulation and eyeballs – we are forgetting the issue of newspaper readership. Thus while – ABC figures are showing a huge spurt in circulation across languages and regions – the growth in readership is nothing to write home about.

Therefore, it was interesting to read Raju Narisetti’s latest blog post (click here to read) on how his paper is using devices like “Charticles” to grab the typically short attention span of the “Internet generation that lives in the multimedia”. Though’ it might appear to be ‘not-so-subtle’ plug for the MINT (“I mean stuff like this that regular readers of Mint are used to seeing on a regular basis”) – but, we can excuse the ‘Romantic Realist’ for this minor self-indulgence - as this is probably what the future of newspapers “might and ought to be”.

I had touched upon this – in an earlier blog (2000 Monkeys or a 1 ton Gorilla click here) , which didn’t attract any comment. Considering the huge readership this blog commands (!!), I am not sure if the lack of response can be construed to mean – that, such issues are still not on the radar screen of Indian newspapers.

Interpreting The Economist Ads

The tangential new campaign of The Economist – “Interpret the World “ - plastered on bill-boards across the city leaves me flummoxed. I don’t know what it’s doing for you. I simply don’t get it. I think the ads defy “interpretation”. May be I am not the typical Economist reader and, hence, missing the point.. That’s why, despite “e-mailer-a-day” reminders, I haven’t renewed my subscription.

In the past – Ogilvy has done some legendary campaigns (mostly outdoors and also TV) for the magazine especially in the Far East (Singapore and Hong Kong), which won them a large number of lions at Cannes (probably, the highest for any print publication ever).

The vintage Economist series and the ‘GOD’ campaign of Singapore (click here to check and also on this for some more pics) are two classic examples of great 360degree advertising from Ogilvy.

While I can understand the need to be original and different – why re-invent the wheel ? Doubt if 'GOD' too will be able to "interpret" the present 'over the top' campaign.

Here are some of my all-time favourites from the archives– tell me what do you think of them ?

Father & Son

Sperm Donor

Even the Economist reading wife' has the same problem...

(t)errorism

Taking Decisions

the Management Trainee

Forehead

A matter of perspective

Cutting Edge

Obstacle Race

Question and Answer

With that I too rest my case..

2000 Monkeys or a1 ton Gorilla.

In a just published article in BusinessWeek (click here to read) , Jon Fine ( who also keeps a media blog : FineOnMedia read here ) prophesies the imminent demise of the big-city papers. He still gives a chance to the “national” papers like the New York Times – even if for just a while longer.

It’s probably the latest of a million elegies ( it’s difficult to keep track – with one being written practically every hour ) for a medium that will go down in the history of the universe as the longest occupant of a death bed – giving even the ol’ man Bhishma a run for his record. But, I found his analysis quite interesting – tho’ it is primarily from an US market stand-point.

First, he thinks the main cause of their un-doing would be the dis-aggregation of the local advertisements ( especially Classifieds ) at the low end to “Ultra-cheap” on-line options such as “Craigslist click here ” or at the high-end to the free-monthly glossies.

Second, the content needs ( and consequently - “editorial energies” ) to Blogs or other independent “on-line endeavours” such as “MinnPost” ( which defines its mission “to provide high quality journalism to news-intense people of Minnesota click here to read).

And, for those publications who are still deluding themselves with the hope of garnering revenues from the “sub-classified local segment (such a pizzerias and dry-cleaners) – he quotes the CEO of a Local Media Research firm, who compares local advertisements to “2,000 – two pound monkeys” ( as opposed to a 1 ton Gorilla – therefore making it a very “unorganized and dirty business”).

I am not sure how far the comparison would exactly hold true for a market like India. In any case there aren’t too many “big-city papers” of any significant size left – with the exception of a few ( non – Hindi ) vernaculars and just a couple of English dailies ( The Telegraph and The Hindu - tho’ they may not like to be called Regional or Local) and the same logic may not quite apply to either of these 2 categories.

By the same token, India doesn't have "national papers" like the New York Times, USA Today or WSJ ( tho' MINT is trying to be a bit of the last ). What we have - I would submit - are a bunch of 'multi-local' papers. Even the giant banyan-tree of a ToI - to my mind - is an "umbrella mother brand" under which it houses several localised editions (much like what a Brooke Bond- Lipton or Tatas do in having separate blends of tea for different states under the same brand name). So is the case in the vernacular space with a Bhaskar, Jagran and Hindustan or The Hindu, Deccan Chronicle and the New Indian Express in the south. In doing so, all of them try to straddle both ends of the market - wooing the national advertisers at one level and mopping up the local business and classifieds at another.

While this dual pronged strategy may work to hedge the risks for Indian newspapers - at least for sometime to come, I think the real game-changer could be the content back-lash, which Fine talks about. In dumbing themselves down to cater to all consituencies newspapers may be losing their plot to the more interactive media options available today thanks to the net. I am, therefore, a little tempted to quote from the 2 comments posted on the article, which lends support to his thesis.

“…… Big city newspapers have already been replaced by blogs, video postings and discussion forums ~ at least for the news addict demographic. Why read what some edited hack piece says about a political speech when I can review the entire thing online and evaluate it for myself? And why would I want to read it on a piece of dead tree, if I can instead debate it with others who are interested, and follow the links to every piece of pertinent information we can find ?”


“…a former daily reporter I used to pick up the local papers when I traveled around the US -- now I just get the Times, the Journal and the FT when I can find it -- most dailies are trying to be all things and hit lowest common denominator…….”

What do you think ??

When Adults act as Kids !!

Sen ( read comment here ) has drawn my attention to this “straight on the bull’s eye” article of Pramath ( Raj Sinha ) published in this Wednesday’s ( September 23rd ) issue of MINT, which I seem to have missed in the flurry of writing blogs. I agree with practically everything Pramath has said in his piece “Time to grow up ..” ( click here to read the full piece) – and some of it we too have already touched upon in a few of our earlier posts (e.g. Is it only about Eye-balls click here to read ).


Though’ very direct, Pramath – being his urbane and sophisticate self – has still pulled a few punches. He says advertisers – “subsidize” publications. While this may be true in rest of the world – in India it has gone a few steps further. From a situation of 80:20 mix of Advertising to Circulation – thanks to deep discounts, jodis and gift subscription schemes most newspapers have gone to “negative” realization on Circulation (net of Trade Commissions). In the process – publications have become subservient (I am tempted to use a stronger term) to advertisers and Media Buying Agencies.

Vanita Kohli writes in her book “The Indian Media Business” (Page 39, 2nd Edition ): “……It is routine for advertisers to pull out entire campaigns if there is even a mildly objective reportage on them”. Those of us who have worked in publications know the extent to which this practiced and how publishers (with a few rare exceptions – that too selectively applied) tamely give in to such pressure plays.

I had written about my newspaper vendor not bothering to collect his bills for months - because now he earns much more from trade commissions and schemes. The other day, a friend from the circulation department of a leading newspaper group was telling me, how they no longer see the “dips” in sales during holiday seasons as before. This is because there is a “negative incentive” for the reader to ‘stop’ the copies – while the family is on holiday, as with the price they pay for the paper being next to nothing they would lose out much more from “Raddi” realization.


It was an interesting realization for me (a fact which one always knew but never thought of it) that, one cannot compute the actual “all India” circulation of practically any newspaper group from the published ABC figures, because at any point in time – some edition or other of theirs will be out of ABC.

The Readership Surveys make up another story altogether. NRS, which was actually a creation of the publishers themselves ( a joint initiative of INS and ABC) has been given almost a quiet burial (though’ I believe there are some murmurs of reviving it again – because IRS is becoming inconvenient for some ). We remember the shameful litigations that happened over it – after editors (of the same publications which had filed the ‘proxy’ law-suits) had written signed pieces upholding NRS as the “gold-standard” of the industry ( when their papers were trounced by competition in the IRS ). Then it was amazing to see a section in the INS going to embrace the IRS - over-ruling objections from some industry veterans ( IRS was seen as a rival survey – as it was the product of a reactionary move by advertisers and agencies against the NRS) - in what looked like a Indo-Pak peace mission to the Attari Border - only to denounce it later.

So, is the Advertiser getting fooled by the “smoke and mirrors” (to borrow Pramath’s term), which we hold before them. I am not sure. I think both advertisers and media buyers have become much more savvy to separate the chaff from the claims and have developed their own metrics ( however, approximate they might be) to get a sense of the real numbers. A case in point would be the very publication in which Pramath’s piece appeared. For all it’s tall claims of being the undisputed No 2 Financial paper in the country with a circulation of 120k and readership of 1.6 (higher than ET – read Samil’s Comment on the ‘I-Pod Effect’ click here) you have to only turn its pages to see the volume of ads it is managing to get after 18 months of its launch.

So it could well be that in trying to fool others, the publishers are being a bit “clever by half” and might end up fooling themselves. Something, I feel, the PE bankers who are waiting in queue to be part of the ‘big growth story’ of Indian Print media should take note of.

Let’s debate this further. For the moment I just wanted all of you to read this very positively provocative article.

The Great Innovation Revolution

Robiin Jeffrey’s seminal work – India’s Newspaper Revolution, tracing the journey of Indian newspapers over the decades - is a fascinating read.

American newspapers had from the very beginning seen advertisements as the life-blood of their publications. Doyens like Otis Chandler (owner of the LA Times) had declared, “The economics of American Newspaper publishing is based on…advertising…not circulation”. (Though it’s another story - how his newspaper was run nearly to the ground by the professional managers he had hired from Consumer Product giants like General Mills – forcing him to come-back from retirement and reassume the reins of the company to undo the damage wrought by the “break fast cereal” marketers – (Read the Blogkeeper’s Note at the bottom of the post)

Indian publishers, on the other hand, for a very long time had shunned advertisers with almost a sense of contempt. Advertisements were considered an encroachment not just into editorial space but also – by some – as a compromise of editorial independence and integrity. This was, of course, partly a carry over of the pre-independence nationalist and the post-independence socialist ethos of the country.

But, all this makes me wonder – if we are displaying the same prudishness in our resistance to accepting today’s trends of so-called “Innovations” in advertising.

So I asked a veteran of the industry for his views. Having worked for 3 media majors over 3 decades – he is one of those who has seen it all and done it all. On strict conditions of anonymity he agreed to write this “no ‘edit space’ barred” piece for ‘Deceptively Simple’, which could well be an addendum to the chapter on Indian Newspaper Advertising in Jeffrey's book - which stops at the end of the 90s.

While – being oath bound - I can’t provide any clues, there aren’t any prizes either for guessing his identity. Read on:


The Innovation "Bloomers" !!

Well, this mysterious article was to be on Innovation in Print Media. Is there a true innovation? Or are there other factors that are masquerading as Innovation? We shall examine it.

Applying the definition/meaning of innovation as an idea that is perceived by advertisers as new, I looked around for such examples. There were plenty available – from bubbles in the center of pages, beautifully ‘decorated’ by content to oil pipelines zigzagging through each page of the newspaper to colouring the content in yellow ( click here to read) – in ‘rich’ homage to a telecom service provider. Later generations will, no doubt, debate on whether the choice of the colour was an accurate description of the prevalent state of print journalism. But that’s another story.

But does a creative rendition of an idea necessarily mean the commercial message must intrude on the content? Can’t there be excellent renditions of creative ideas within the boundaries of advertisement space - as we had in the past?

Bubbles and Phallic Symbols

To understand this development we need to rewind. The availability of higher disposable income, rise in consumer base, opening up of lucrative markets tiers beyond the metros, as well as - fragmentation of media and multiplicity of media options has created an increase in demands for consumer brands. This lead a tendency to spend more on FMCG brands and a profusion of brands are clamouring to be seen and heard. As in a crowded marketplace, what does the marketer do - Shout as much as possible (read big budgets) ? But with multiple full-page ads in a single day’s paper, the full-page no longer created the desired impact. There were pressures on the media buyers who devised (or thought they had devised) a clever route. Just pirate into the content. Steamroll it but ensure its noticeable. So that’s how you see a car swirling within the page or mobile phones protruding like phallic symbols. Sure it’s noticed. Whether it will carry a positive connotation in the reader/consumers mind is really not the point, as the objective is to ensure the message is noticed.

And why don’t the newspaper refuse such blatant intrusions on the content? Obviously, it’s the revenue that comes with such demands. In a scenario where the sale price don’t even cover the delivery cost from the printing press to the readers’ home; such additional revenue is highly coveted. The irony being, the ad sales executives themselves keep coming up with devious strategies of destroying the editorial columns and presenting them to the advertisers. After all, they too have high targets to accomplish.

However, like all good things, which are overdone, such innovative tactics too soon lost its novelty value. Now, everyone could be innovative – protrude the end of your product into content and if that wasn’t satisfying enough, why not ‘buy’ your own cover page – create a full four cover pages or just restrict it to half its size. It was getting monotonous and the fear of a negative impression in the consumers mind was feared. So it was time to innovate once again – after all, isn’t ‘NEW’ the perennial favourite slogan of advertisers?


The Space Pirates

They did not have to look around much. A market savvy multi-media group came up with a perfect solution – why just ‘pirate’ into content – why not ‘create’ the content? And thus another innovation was created. The ‘promise’ was to get a cynical reader or consumer to see your message and intrusion was not a great way, it was being increasingly felt. Great, so what’s the delivery mechanism of this promise? Simple. Do away with those old-fashioned ‘advertorials’ (the problem with them being the addendum ‘advertisement’ being scribbled in one corner to separate it from news content), intrusions etc. Instead, present the ad message as content, without creating any visible distinction of separation from news. It was presented as news itself. After all, this innovation touted to ‘provide editorial coverage for your products, services and events, with true news value’. In case the advertiser was still dumb enough to comprehend what he’s reading, it goes on to state ‘ we mean real newspaper articles….., not advertisements’ (emphasis not mine). Wow, here was the real thing and like American journalists covering the Iraq war, the message read ‘ an editorially conceptualized brand message embedded in news/feature articles……’ (emphasis mine). The perfect solution was found.

15 minutes of fame

While both the advertiser and media owner were happy with the unexpected revenue source welling up, the casualty was the consumer. After all, if there were glowing references to a product by a leading newspaper, perhaps it merited purchase. It was a different matter that the product was not tested , before endorsement. Since the ‘purchased coverage’extended to individuals too, there remains a clamour to feature ‘my party’ – simply because I can buy its coverage. So readers were soon deluged by P3 personalities ‘born’ daily – 15 minutes of fame as Warhol put it.

So where do we go from here? As a logical next step allow the brand managers of a large spender to edit (or would take-over be a appropriate term?) the newspaper for a day. For a fat consideration, of course.

News as a Commodity

Perhaps it’s not so bad as it appears. With a highly cynical populace living in a world where information and entertainment are indistinguishable , maybe it’s difficult to believe anything. After all, who defines the meaning of news ? If news is a commodity, why can’t it be purchased like any other commodity?

At the end of the day, what matters is profits. If the news columns too can be made profitable as the ad columns, it’s a double whammy. After all, innovation is expected to add value, and if this is not value creation, what is?

Let a thousand innovations bloom !


Blog-keeper’s Note:

After the LA Times scandal ( where the newspaper had entered into a reveue sharing arrangement with one of its advertisers – Staples – for a ‘co-produced’ Sunday Magazine of the paper ) a commentator wrote –

“Newspapers are always dying, and someone is always killing them . radio was supposed to bury them. So was Television……..So was the Internet.

“But the latest murderer is the corporate bean-counter. He breaches the Chinese Wall between business and editorial….cares more about stock-prices than about the front-page lead…..”

So who will be the Otis Chandler of India ? Anyone willing to take a bet on that ?