Media

Will Print ads in India become unaffordable?

If you want to advertise in English print media, the most sought-after brand is the Times of India (BCCL). The youth in this country likes it (Page 3). Kids these days don’t bother to read the main section 🙁 but then going to a circus may be more fun than reading about what is happening in the parliament.

Come August 2008, it will cost you a lot more (40%) to advertise in the Times of India. All other print publications will follow suit. After reading this article in Mint, I wanted to write about the alternatives advertisers had in India. I had some thoughts about it, and for some reason, I came across very relevant articles this week.

A big chunk of the advertising pie is taken by the Print and TV in India,

The total ad pie in India was worth Rs 17,356 crore, of which print accounted for Rs 8,591 crore and TV Rs 6,766 crore.
Print advertising in India grew 3.5% in 2007 over 2006
TV advertising in India fell 0.8% in the same period.
Of the total ad spending on print media in 2007, English got 48 per cent share while Hindi and other language press grabbed 52 per cent. On television, however, the share of spending on English channels was 20 per cent compared to 80 per cent taken up by Hindi and other Indian languages.

In India, you have several reports, but one says by 2012, Internet ad revenue will increase to Rs 2500 crore (approx $600m). Not sure about Video advertising numbers in India, I think it is too early to predict. The scene is a bit different in the US,

In the US, Internet ad revenue will increase from $25.5 billion in 2007 to $51.1 billion in 2012 and that revenue for Internet video advertising will jump from $.05 billion in 2007 to $3.8 billion in 2012. According to TNS Media Intelligence, traditional media ad spending rose a miniscule 0.6% overall in the first quarter of 2008, with anemic performances from television (1.7% increase), magazines (up 0.8%) and outdoor advertising (a 2.5% gain). Newspaper ad buys were down 5.2% and radio saw ad sales fell by 4.5%. Meanwhile, the Internet, for which TNS included only display ads, leaped ahead 8%, about $2 billion, for the quarter.

I recently attended a discussion held by TiE, Bangalore, titled “How can Entrepreneurs leverage the Media Boom?”. The discussion was moderated by Arun Katiyar, who has worked in every medium (print, TV, radio, internet, mobile!!!). Shanth Kumar, Chairman of Deccan Herald, mentioned that newspapers in India are the cheapest in the world. Even neighbouring Pakistan / Sri Lanka prices their newspapers 5-6 times higher than India. I guess it is priced higher as their ad revenues may not be anywhere close to what it is in India.

Sunil Lulla, CEO of Alva Brothers, mentioned the average time spent on a TV channel before you flip has come down from 13 minutes to 5 minutes over the last one year. If the attention span on TV is so small, are the advertisers getting their monies worth?

If Print is expensive, then what next??

BCCL was reportedly the first in the world to come up with the concept of a Private Treaty, they fund your company, and you spend “all of it” back on buying advertisements in their publications. You call it fair or unfair or whatever, bottom line if the company uses it properly, I believe they will benefit from the awareness campaign.

In Jan 2008 VCcircle reported that other media companies too would start their private treaties. After reading that article the first thing that came to my mind was “I may not want to be stuck with just one publication, I want the ads in all publications. It would be really useful if someone started a fund which had agreements with multiple publications”.

And wholla, I recently read about Ozone Capital starting a fund on the same lines! It would be interesting to see how this new concept would turn out to be. Purists have one problem with private treaties – the publications carry articles in favour [biased] of the portfolio companies, which the publications deny.

“There Are Two Currencies For Advertising – Cash And Treaties; We’re Not Buying To Sell”, an interview with S. Sivakumar, CEO Designate, Times Private Treaties analyzes Private Treaties to a great extent.

I think for the SMBs advertising in Print will become unaffordable. The ad budgets for SMBs remain the same year-on-year (for a majority of them) and their ad size in Print will shrink year on year. So where should SMBs advertise? My unbiased suggestion would be the internet and mobile 😉 I think one has to advertise in all mediums, you cannot dump Print for other mediums but I am sure the internet’s share in the ad pie getting larger in the near future. In fact, the internet will be competing a lot with mobile marketing.

Lynn de Souza, chairman and CEO of Lintas Media Group, says during slowdown “The digital media including mobile and internet do offer a great advantage to advertisers in times like this.” I am optimistic about internet advertising growing in India. The problem is everyone compares us with the US and they say “Indian internet scene is way too small”. This is a very pessimistic approach. It is not correct to ‘always’ compare the user base, surfing habits in the US and India. I believe the right approach should be to be ‘inspired’ by other mature markets and see how we can grow in India.

Advertisers who are not net savvy were earlier saying “Ye, Internet banner kya hai?” (what is this internet and banner??). In general publishers on the internet are held a lot more accountable than other mediums. I believe this is one good enough reason to patronize marketing on the internet. You know how many viewed your banner [CPM], how many clicked on your banner [CPC] and how many filled a form [CPL].

Mobile marketing will be a big player in India. Many don’t agree but time will only tell. The reach of the mobile is something one cannot ignore, I know this from MyToday. We ensured Oneindia.in’s content is on the web, wap and SMS just to make sure we reach as many people as we can. These days I get bombarded with promotional emails from Mobile marketing firms. The ads clearly convey how serious a medium it is becoming in India. See mkhoj and 160by2 ads.

While everyone is talking only about advertisement revenues I believe a good chunk of revenues from classifieds will move to online space.

In a nutshell, online and mobile marketing will only swell in India.

BG Mahesh

Internet application ideator and implementor. Been there and done that since early 1990s. I like to present data to the common man in the simplest manner on the internet.

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View Comments

Will not Disclose says:

July 25, 2008 at 5:36 pm

When you compare the "CPM" (# of people who see an ad) for print ads vs online ads, it is amazing how expensive print ads. This is primarily because their circulation is usually low compared to "viewership" on internet properties/sites. However, there are more people who "share" a magazine or newspaper than in other parts of the world which means that their viewership is higher than their circulation numbers.