When a major media group like Bennett Coleman & Co. Ltd. (BCCL) revises its advertising rates, the impact is felt across the newspaper industry, mainly the larger groups. BCCL announced its advertising rate hike of 8-10% across its various newspaper brands just at the turn of the new financial year. According to BCCL, sustaining innovations and delivering value to readers call for additional investments in “content, copies, distribution and technology,” part of which would have to be borne by the advertisers. After all, it is the advertisers who get to leverage the brand value of BCCL’s top properties like The Times of India, Economic Times and Navbharat Times at highly competitive prices.
Following suit, the other major newspaper groups have also indicated a similar stance where they either intend to or have already raised their advertising rates in the new financial year. The Pitch Madison Advertising Report 2017 values the print advertising market in India worth Rs. 20,000 crore in the current financial year and indicates a stable growth by 9.5%. For media houses that are listed in the stock market, like HT Media or Dainik Bhaskar Group, higher advertising rates are a normal part of their growth story. In fact, their pricing strategy is quite transparent.
In Hindi language domain, the major newspaper group, Jagaran Prakashan, is not so forthcoming with its plans for revising advertising rates. In contrast, Rajasthan Patrika, which dominates the Hindi newspaper market in Rajasthan, did not wait for the new fi nancial year to hike ad rates by 10%. In Kerala, the market leader Malayala Manorama raised advertising rates by 10% on the very first day of the new financial year. Group vice president Verghese Chandy reasons, “Everything in the world goes up but everyone wants newspapers at the same price that they were sold 10 years ago.”
Chandy further explains, “The paper has grown by 100,000 copies in the last one year. 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.” The Statesman, which controls a large part of the narrative in the English language press in West Bengal, has also increased its advertising rates by 15-20%. Interestingly, not all English language newspapers have a formidable hold over the market as the top players do. The Express Group’s pan-India presence, for instance, has not fetched it great ad revenues.
Opinions vary with regard to the strategy that media houses like the Express Group or the Millennium Post should adopt. Prabhu Chawla, one of India’s leading editors, feels newspapers need to get serious about hiking their advertising rates. He is worried that “news is being subsidized; compromises are being made by the owners and editors to improve the bottom line.” On the other hand, there are others like Durbar Ganguly, editor-in-chief of the Millennium Post, who are less sure about playing hardball with advertising rates. Ganguly says, “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.”
