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Print's Playbook For 2021
Covid-19 clobbered the print media, but it also lit up the path ahead, as print emerged as a fount of credible information
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A slowdown had been evident in the print media space in India over the past three years. The pandemic and the subsequent lockdown that followed proved that proverbial last straw on the camel's back and the subdued rate of growth of the previous years culminated in revenue shrinking by eight per cent in the print industry in FY20.
The industry witnessed a steep decline in revenue from both circulation and advertisements. According to the KPMG 2020 Media & Entertainment Report, while revenue from advertising staggered at Rs 198 billion, revenue from circulation was reported at Rs 107 billion, adding to a total of Rs 306 billion in FY2020, compared to Rs 333 billion in FY2019.
Caution had dominated sentiments across industries even before the lockdown came into effect. Once restrictions on movement began to hit circulation of print products, advertisers seemed on edge about spending. Soon print campaigns began to be withdrawn. As a matter of fact, the top three listed print media players collectively reported a more than nine per cent drop in overall revenue in FY2020.
English language publications saw circulations shrink by seven per cent. Hindi publications and regional newspapers saw their circulations dip by three per cent. Since the eight metropolises dominate sales of English newspapers and regional language newspapers dominate sales in the rest of India, the latter performed relatively better. The English language publications had in any case, reached a saturation point in their markets. Regional newspapers on the other hand, have been steady in terms of both readership as well as revenue, and are operating at 80-85 per cent of circulation.
It goes without saying that the first half of 2020 didn't go well for print publishers, but the second half of the year did bring some cheer, as restrictions on movement were eased and the festive season set in. "Print went through a huge transition during this year. The first half of 2020 saw a sizeable drop in circulation, as distribution was disrupted due to the pandemic. However, with festivities in the second half, we saw normalcy coming back," says Anand Bhadkamkar, CEO-India, dentsu.
"In terms of advertising categories, FMCG and Auto rode high during the festive days, with a strong comeback from ecommerce and edtech. Also, with longer restriction on newspaper movement in the metros due to social distancing, regional and tier- 2 markets bounced back relatively faster," he says.
Sanjay Gupta, Editor in Chief and CEO, Jagran Prakashan, is also convinced that the sector will recover quickly, notwithstand-ing the unusual times that prevail. "2020 was a year in which businesses across media were adversely impacted. However, despite the pandemic, our markets have shown a higher resilience, and therefore, the road to recovery was quick," says Gupta. "During the pandemic, print has emerged as the most credible and trusted medium - almost 2X of TV and 1.5 X of online as per an EY survey. The festive season saw advertisers coming back, and we hope this momentum will continue," he goes on to say.
While Covid-19 dampened the growth trajectory of the print industry, it also inspired greater collaboration among industry players, who focused on reduced distribution costs by optimising networks. These collaborations enabled an increase in cover prices to commercially viable levels, a change in business model that will make the industry more risk ready.
The Credibility Quotient
The print media has often been touted as a reliable pillar of the media and entertainment segment. While the sector did witness extreme slowdown in advertising expenditures and curtailed circulations, it is anticipated that the situation will inspire reduced dependence on ad spends and monetising of quality content in 2021. Additionally, long-term savings through changes in legacy cost structures and streamlining of editorial processes are likely in the coming year.
Anant Nath, Executive Publisher, Delhi Press, reiterates that the transition that was to happen over the next five years, had been made an immediate reality by the pandemic. "Print faced a slew of challenges in 2020, just as the other sectors did. However, it particularly experienced a setback with respect to advertising and print supplies. With the shift towards digital channels of news getting stronger, the ad spends went even below the pre-Covid days," says Nath.
"We saw more shares being spent on digital and electronics," he goes on to say, adding, "For publications to survive long-term, they must reorient themselves and proffer better quality content, be it in digital or print." Nath is of the opinion that advertising was only a supplement to the overall revenue of the industry. "Publications must now look at improving content, and not let advertising decide their fate. This may be a slow change but publications will definitely come out stronger," he says.
The industry may have witnessed a decline in distribution in 2020, but digital news platforms brought home the bacon. One of the few trends spotted was that of the reader shifting to news websites or apps, instead of physical newspapers. News publishers also adapted to the situation and took to the internet to break the latest news. Says Bhadkamkar,"Print lost its share to digital in 2020. While it ranked second in terms of AdEx, it did lose its share and position to digital during the pandemic. With advertisers now coming back gradually, the growth is expected to be back in 2021."
Gupta also anticipates a glittering future on the business front. He believes that in 2021, the economic rebound would be faster than normal across all print markets. "Also, Uttar Pradesh and Uttarakhand will be getting into election mode towards the second half of next year - this too augurs well on the business front."
Notwithstanding the jolt it gave the industry, Covid-19 also brought to light the importance of the print media as a source of reliable and credible information. It is now apparent that a digital evolution is inevitable in the segment. It would be pragmatic for publishers to invest in sustainable digital strategies aimed towards monetisation of the subscriber base, with creating and delivering quality content as the cornerstone.