STRATEGIC MEDIA PLANNING

GROUP - 2
Archana M
Jaikesh K
Jaishankar K
Kamala Priyadarsini S
Vasanth V
Vivek Ganesh
01 April 2014 Amrita School of Business
Coimbatore

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TABLE OF CONTENTS
Executive Summary ...................................................................................... 1
CHAPTER-1 ................................................................................................... 2
How are Newspapers in India faring compared to west? ........................... 2
Newspapers in Western World ....................................................................................................... 2
Newspapers in India ......................................................................................................................... 3
Key Driving Reasons......................................................................................................................... 4
Special Reports on the News Industry .......................................................................................... 6
CHAPTER-2 ................................................................................................... 7
Is Newspaper Market Growing In India? ..................................................... 7
Reasons for Growth .......................................................................................................................... 9
CHAPTER-3 ................................................................................................. 12
How have the Newspapers adopted to various threats digital, television
etc.? ............................................................................................................ 12
At United States of America .......................................................................................................... 13
At Australia ...................................................................................................................................... 14
At China ............................................................................................................................................ 14
At Japan ........................................................................................................................................... 15
CONCLUSION .............................................................................................. 15
REFERENCES ............................................................................................... 17
LIST OF FIGURES
Figure 1 Comparison of Print Circulation .......................................................................................... 3
Figure 2 Comparison of Circulation - 2 .............................................................................................. 5
Figure 3 Domination of Asia in Circulation ........................................................................................ 5
Figure 4 Indian Newspaper Market - Circulation, Readership, Revenue ...................................... 8
Figure 5 Certified Circulation of Newspapers .................................................................................. 8
Figure 6 Growth Rate of Circulation .................................................................................................. 9
Figure 7 Readers per Copy on 2012 vs 2006 ................................................................................... 9
Figure 8 Per Capita GDP ($) .............................................................................................................. 10
Figure 9 US Advertising Revenues Print Vs Online ........................................................................ 13
Figure 10 US Readership by Ages ................................................................................................... 13
Figure 11 Circulation Revenue in US ............................................................................................... 14
LIST OF TABLES
Table 1 Growth of Newspapers .......................................................................................................... 8
Table 2 Female Literacy Comparison ............................................................................................... 11
Table 3 Indian Advertising Revenue by Media Category .............................................................. 12
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Executive Summary
Newspaper is one of the Mass media categories where any company can reach out
to a common man. But Newspapers are slowly losing its pace and energy to Online
spaces. Many Newspaper corporations across countries are affected by more
Internet penetration.
India? Happy No!
India has seen an increase in the circulation of printed issues though many
developed nations has seen a decrease during last decade. One attributed reason by
them is increasing trend in Digital Media. But most (in fact all) nations are spending
most of its media spend in Newspapers (after TV). Revenue generated from
newspapers through Advertisements is seeing a constant decline in recent years. But
in India, there was an increase in both (no. of circulations as well as
Advertisements).
Possible reasons for increase in newspapers circulation in India is
Increase in Literature
Increase in Disposable income
Decrease in Readers/Newspaper (More people buy newspaper)
In India, penetration of newspapers is less when compared to Western nations. The
revenue through Newspaper is also considerably less when compared to US which
are around $140+ Billion whereas in India its less than $6 Billion.
Indias internet penetration is growing at a faster pace but the impact isnt huge yet.
According to E-marketer, 20% of people are interested to read
newspapers/magazines in their gadgets rather than Printed copy and at the same
time many prefer playing games/entertainment purposes.
So, is this the start for decline in Print?
May be, but, Indian industry have an advantage when compared to much more
mature markets. That is comfort of Time. In mature markets, well settled players
are looking to gain more cyber space for more than 10 years but we have time to
create and establish a strategy to capture Digital space. The organisations just need
to be innovative.
Hope India continues its growth in print and at the same time let it increase its
online presence to stand-on par with global players.

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CHAPTER-1
How are Newspapers in India faring compared to west?

Source: World press trends, Zenith Optimedia
As in many other fields, the Indian experience does not quite fit into trends across
the world. The case of newspapers is one that illustrates this general statement. It
goes without saying that the growth of newspapers in India, especially in recent
years, is directly related to the growth witnessed by the Indian economy.
Newspapers in Western World
Newspapers are widely held to be in serious crisis. In the Western world, the rise of
online news and new multiple sources of news and information have changed the
economics of newspaper publishing.
The crisis has been felt most painfully in the United States, where even as online
audiences grow, print circulation continues to decline. When circulation and ad
revenue are combined, the U.S. newspaper industry has shrunk 43 per cent since
2000, while its estimated that the number of journalists in daily newspapers has
fallen from 56,000 to 40,000.
The digital revolution is undermining the business models that see consumers pay
for print news, with a younger generation accustomed to the idea that news is free.
Newspapers are struggling to try and find a way to make money online, constrained
by the lack of a viable revenue model. To make matters worse, newspapers make
only about a tenth from their print readers as what they make from digital readers.
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According to the Newspaper Association of America, a print reader is worth an
average of US$539 in advertising alone, while an average online reader is worth
US$26.


Figure 1 Comparison of Print Circulation
Source: WAN-IFRA ITALIA June 2013
Newspapers in India
In India, newspaper markets are growing strongly, fuelled by robust economic
growth and demand from an emerging urban and literate middle class that is
enjoying higher incomes and rising standards of living.
About 90 percent of print readers in India consume content in Hindi and other
regional languages. The popularity of Local Languages is the Reason why print is
less affected by online in India than elsewhere.
In India, the growth of a popular vernacular press is skewed to entertainment,
scandal, gossip and sports with some coverage of public affairs; which while not
being a perfect development, supplements what the Indian media system has
offered to the countrys citizens in the past.
The newspaper industry in India is doing well as compared to that in the West.
While the circulation of paid dailies in the Western markets has been de-growing
over the last 5 years US (-12.5%), Canada (-18%), Germany (-10%) and UK (-
13%) the same has been growing in India (+ 11%).
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Key Driving Reasons
The five key reasons driving this phenomenon:
1. The penetration of digital media in India is less than in the West.
While markets like US, Canada, Germany and UK have about 96% of the population
using the Internet, only about 20 to 30% of the people in India actively surf the
Internet.
2. Newspapers still have a large potential for further penetration
In India, circulation of newspapers is about 143 copies per thousand of adult
population. For Singapore this number is 256, and for Hong Kong it is 355. This
shows that there is significant room for further penetration of newspapers in India.
Also, the literacy rate in India has improved over the last decade.
3. India has a large number of regional newspapers.
These papers have two major advantages: one is the ability to connect with the non-
English speaking population, and secondly, the ability to customize news at the last
mile (for example, district-level news). Based on these two factors regional
newspapers continue to make a large contribution in sustaining the Indian
newspaper industry
4. Newspaper advertising has also seen significant growth in India over
the last five years.
While newspaper advertising in the western markets has de-grown by 12 to 50%
over the last five years, in India it has grown by over 50%. This creates a positive
cycle as more advertising comes into newspapers, publishing companies can
invest more into the product; this helps growth in circulation and readership and
that, in turn, goes back to fulfilling the needs of advertisers. Print still remains the
largest contributor (41%) to the advertising market in India while digital contributes
about 10%.
5. Newspapers continue to command the highest credibility in terms of
content as well as advertising.
A McKinsey research showed that while 66% of respondents consider newspaper
advertising to be inspiring confidence and informative, only a mere 12% thought so
of ads on the Internet.

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Figure 2 Comparison of Circulation - 2

Source: WAN-IFRA ITALIA June 2013


Figure 3 Domination of Asia in Circulation
Source: WAN-IFRA ITALIA June 2013
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Special Reports on the News Industry
The Economist sizes up the newspaper business worldwide and notes that not all
newspapers are in crisis like those in the U.S. The hottest newspaper market is
India, which overtook China three years ago to become the leader in paid circulation
with 110 million copies sold each day, the Economist reports, using World
Association of Newspapers figures.
According to the Indian Media and Entertainment Industry Report 2011 by the
Federation of Indian Chambers of Commerce and Industry, a trade body, and KPMG,
a consultancy, India is one of the largest newspaper markets with more than 107
million copies circulated daily, more than China, and accounting for more than 20
per cent of all dailies across the world.
Nielsen, Research Fellow at the Reuters Institute for the Study of Journalism at the
University of Oxford, says that newspapers also become more attractive for
advertisers who see a growing customer base for people who have been lifted out of
Poverty and deprivation and who suddenly have money to spend.
So those are the main drivers in countries like India. So its urbanization, growing
literacy, economic growth within the context of a democracy in which it is a
meaningful thing for the average citizen to try to stay informed about public affairs.
Robert Picard, Director of Research at the Reuters Institute for the Study of
Journalism at the University of Oxford, United Kingdom points out that India has put
a lot of effort into boosting its literacy rate. The 2011 national census data showed
an adult literacy level of 74 per cent, up nine per cent from the last census a decade
ago.
As soon as a person becomes literate, what they get is a newspaper even before
they buy a phone, its the first luxury a man affords


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CHAPTER-2
Is Newspaper Market Growing In India?
In India, Newspaper market are growing strongly fuelled by economic growth and
demand from an emerging urban and literate middle class that is enjoying higher
incomes and rising standards of living.
Here is what the leading dailies had said about the Indian Newspapers Industry!
Quoted on 27 May 2009,
Newspaper circulation up 1.3% in 2008 in India despite slowdown
circulation gains were not only occurring in the emerging markets of China and
India, and 38 per cent of countries reported gains in 2008, and 58 per cent saw
circulation increasing over five years.
Quoted on 3 September 2010,
Where print makes profits
People like to read in their mother tongue. The circulation of Hindi papers rose from
less than 8m in the early 1990s to more than 25m last year.
Quoted on 1 August 2011,
Newspapers: Why Indias newspaper industry is booming
With reference to KPM, Indias Newspaper growth in 2011 has grown by 2/3
rd
from
2005. This industry values $4.37 Billion in 2010 whereas in 2005 it was $2.64
Billion.
Quoted on 3 June 2013,
Booming market for Newspapers
In the 7 year period from 2006 to 2012 the total number of paid copies certified by
the ABC, rose by over 10 million to hit 48.29 million. If you take unpaid circulation
into account then the total goes well over 100 million copies making India the
second largest newspaper market in the world after China.
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Figure 4 Indian Newspaper Market - Circulation, Readership, Revenue
1

Table 1 Growth of Newspapers
2

Growth of Newspapers on 2012
Compared to 2006
Circulation 25.66%
Readership 14.86%
Revenue 64.46%


Figure 5 Certified Circulation of Newspapers
3



1
http://www.business-standard.com/content/general_pdf/060413_02.pdf
2
Team member compilation based on data arrived from Footnote(1)
3
Team member compilation based on data arrived from Footnote(1)
48
38
0
20
40
60
2012 2006
M
i
l
l
i
o
n
s
Circulation
340
296
260
280
300
320
340
360
2012 2006
M
i
l
l
i
o
n
s
Readership
211
128
0
50
100
150
200
250
2012 2006
B
i
l
l
i
o
n
s
Revenue
2.6
8.7
10.3
1.5
3.2
4.4
2.5
1.6
2.7
9
15
2
4
5.4
3.9
3.7
0
2
4
6
8
10
12
14
16
Certified Circulation (In Millions)
2006 2012
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Figure 6 Growth Rate of Circulation
4



Figure 7 Readers per Copy on 2012 vs 2006
5

Regional language newspapers are seeing phenomenal growth during 2006 to 2012.
Reasons for Growth
Readers/Copy have declined and the growth of circulation increased which indicates
1. Rising in Purchase Power/ Increase in level of Disposable income
2. Price Wars (Language Papers are little bit costlier than English)
3. Growth of Indian middle class
4. Increase in Literacy level
5. Increase in Female readers
6. Regional supplements attract lot of attention as India has different languages

4
Team member compilation based on data arrived from Footnote(1)
5
Team member compilation based on data arrived from Footnote(1)
3.85% 3.45%
45.63%
33.33%
25.00%
22.73%
56.00%
131.25%
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
120.00%
140.00%
Growth Rate of Circulation
2006 2012
5.33%5.41%
-20.83%
-15.24%
-5.00% -4.82%
-25.00%
-39.82% -50.00%
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
10.00%
Readers/Copy
2012
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On April 19, 2012 said,
India no.3 in Purchasing Power Parity
USA : 15.1 ($ Trillion)
China : 11.3 ($ Trillion)
India : 4.5 ($ Trillion)
Though India is ahead of Japan in Purchasing Power, its disposable is well below the
developed nations.
Disposable incomes of
US : $ 48,387
China : $ 8,382
Japan : $ 34,470
India : $ 3,694
But Indias per capita GDP is on steady growth for more than a decade.

Figure 8 Per Capita GDP ($)
6

Indian Literacy has grown by 9% on an average to 74.04% in 2011 when compared
to 65.38% in 2001. Female literacy is increasing and Bihar one of the last in 2011
census has shown a major growth in last ten years which is 35.74%. UP, Arunachal
Pradesh and Meghalaya has shown a growth over 20% in last decade. Delhi, Kerala
has shown a least growth of 3%.
Bihars Growth : 35.74% (Highest by any state in last decade)

6
www.tradingeconomics.com/india/gdp-per-capita-ppp
2,074
2,406
2,672
3,122
3,341
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2005 2007 2009 2011 2013
Per Capita GDP (in $)
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UP, Arunachal Pradesh : 20% Growth
Kerala, Delhi : 3% Growth (Least)
Table 2 Female Literacy Comparison
7

State 2001 2011 Growth
Daman & Diu 40.23% 79.60% 97.86%
Chhattisgarh 33.12% 60.60% 82.97%
Karnataka 38.87% 68.10% 75.20%
Sikkim 43.85% 76.40% 74.23%
West Bengal 42.22% 71.20% 68.64%
Kerala 56.87% 92.00% 61.77%
Delhi 51.85% 80.90% 56.03%
Assam 43.53% 67.30% 54.61%
Nagaland 86.75% 76.70% -11.59%
D&N Haveli 76.47% 65.90% -13.82%
Jammu & Kashmir 67.42% 58.00% -13.97%
Rajasthan 63.36% 52.70% -16.82%
Madhya Pradesh 87.72% 60.00% -31.60%

Increase in Female readers in certain states attracts more publishers and
advertisers.
The above are some of the important reasons to quote why Indian Newspapers are
still growing when compared to other developed economies.


7
http://www.indiaonlinepages.com/population/literacy-rate-in-india.html
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CHAPTER-3
How have the Newspapers adopted to various threats digital,
television etc.?
On June 21, 2011 article,
Can Indian newspapers survive the Net?
Extreme dependence on advertisements made American newspapers an easy target
for the internet
Revenue from advertising in US is in proportion of 73:27
Indias revenue from advertising is in proportion of 80:20 and India is similar to US
market
On 29 October 2012 mentioned,
Adoption of smart devices in India is still relatively low
Despite the adoption of newer technologies, India still remains a mass media-
dominated landscape, with television and newspapers remaining very popular
21.5% of tablet users reported that they read magazines and newspapers less after
purchasing the device, compared with 20% of PC users and 18.3% of smartphone
users
After Purchase of
Less Activity on Desktop/Laptop Smartphone Tablet
Newspaper (In Print) 20.00% 18.30% 21.50%
Magazine (In Print) 25.20% 18.80% 27.50%
Table 3 Indian Advertising Revenue by Media Category
8

Media 2012(Rs.
Million)
2013(Rs.
Million)
% Change Market Share
TV 141,519 150,281 6.19% 41.20%
Newspapers 131,137 142,435 8.62% 39.05%
Internet 20,576 27,000 31.22% 7.40%
OOH 17,366 18,759 8.02% 5.14%
Radio 12,723 13,309 4.61% 3.65%
Magazines 8,162 8,506 4.21% 2.33%
Cinema 2,111 2,470 17.01% 0.68%
Grand Total 335,606 364,773 8.69% 1

8
http://www.mxmindia.com/2012/12/india-ad-revenues-grew-2-6-in-2012-magna-global-forecast-for-2013-8-
7/
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The global advertising market reached $495 billion this year, up +3.8% on 2011.
The US remains the largest market with $153 billion in advertising revenues. Japan,
China, Germany and the UK complete the Top 5.
At United States of America
US which has 78% of Population as its Internet users have a drastic reduction in
revenue through Newspaper print but digital is not so rising.

Figure 9 US Advertising Revenues Print Vs Online
9

With the advent of technology in US, readership through Print has fallen.

Figure 10 US Readership by Ages
10

Despite all this Circulation revenue is stable in US.

9
stateofthemedia.org/2013/newspapers-stabilizing-but-still-threatened/newspapers-by-the-numbers/
10
Team member compilation of data based on footnote[9]
45
47
47
47
42
35
25
23
21
19
1 2 2 3 3 3 3 3 3 3
0
10
20
30
40
50
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
B
i
l
l
i
o
n
s
US Advertising Revenues
Print Vs Online
Print Online
0
20
40
60
80
19992000200120022003200420052006200720082009201020112012
US Readership By Ages
18-24 25-34 35-44 45-54 55-64 65+
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Figure 11 Circulation Revenue in US
11

Even though Digital Media is booming fast, the Print Media cannot be eradicated
completely atleast for a decade or so.
At Australia
12

Newscorp Australia on 17 March 2014 released,
Total newspaper media audience increases 1.2% based on latest Emma
(Enhanced Media Metrics Australia) data.
Total readership of newspaper media is 16.1 million people a month,
representing 92% of the population aged 14 and over.
In addition, print readership still accounts for a significant proportion of total
consumption of newspaper media at 14.7 million, or 84% of the population
aged 14 and over.
Compared with other media, newspapers still offer a compelling story for
advertisers. Brands attract 16 million readers every month.
Regional newspapers alone are purchased by three million Australians, and
community papers have an audience of 4.8 million.
Emma data reveals that 78% of main grocery buyers consume newspaper
media, and shoppers who read newspapers spend more on groceries than
non-newspaper readers.
Heavy newspaper readers spend an average of $144 a week compared to
non-newspaper readers at $137.
At China
13

Advertising on Media is broken down to
Newspaper : 60.48 Billion Yuan (2011)
Magazine : 4.425 Billion Yuan (2011)

11
Team member compilation based on Footnote[9]
12
IFABC-OUTPUT-31-Dec.pdf
13
IFABC-OUTPUT-31-Dec.pdf
0
5,000,000
10,000,000
15,000,000
Circulation Revenue(US)
Weekday Sunday Total
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On-Line : 12.08 Billion Yuan (2011)
Growth of Media Category in China during 2011 when compared to 2010
Digital media : 48.9%
Newspaper : 3%
Magazine : 7%
TV : 11.5%
Radio : 25%
Outdoor : 22.1%
At Japan
14

Advertising Spend from Jan 2011 to Dec 2011
Newspaper : 599,000
Magazine : 254,200
Radio : 124,700
TV : 1,723,700
Total : 2,701,600
Though many countries spend their most of advertising on Print media either
Newspaper or Magazine, yet digital medium is upcoming faster and its growing at a
faster pace. Lot of corporations are trying to capture digital media like Websites,
Facebook pages, LinkedIn pages, Twitter and many more. Companies are looking to
attract many of youths in digital space and make them their customers.
In India, though digital media is in rise, its Internet penetration is still not yet
reached a stage where it would be called as a threat for newspapers/magazines.
Nevertheless, that doesnt mean you need to wait till flood comes. Corporations
must slowly transform their targeting to digital spaces.
CONCLUSION
OReilly pointed out merely joining the chorus that the future is online, online,
online; almost to the exclusion of everything else is a mistake. This oversimplifies a
rather complex issue. Newspapers continue to be a global mass media to be
reckoned with, achieving a global average reach of over one third of the worlds
population. Even in mature markets where circulation is declining, the reach remains

14
IFABC-OUTPUT-31-Dec.pdf
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high.
15
Australia is one of the top 50 countries in World where Internet penetration is
more than 70% but still the Newspaper circulation is stable and in fact it is rising.
Even in US the circulation remains stable but ad revenues saw a decline. Level of
income determines the purchasing behaviour of newspaper. India and China are two
great examples for that and lets hope atleast there is a good rise in GDP
everywhere, so that people purchase more newspapers and there always be Future
for Newspapers.



15
http://www.business-standard.com/article/companies/newspaper-circulation-up-1-3-in-2008-despite-slowdown-
109052700195_1.html

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REFERENCES
[1] The Economist, 2011, Special Report: The News Industry available at
http://www.economist.com/node/18904136 accessed 8 April 2012
[2] Paolo Hooke, University of Technology Sydney, 2012 Why newspaper markets
are growing in China and India, while they decline in the US and UK available at
http://ejournalist.com.au/v12n1/Hooke.pdf
[3] WAN-IFRA ITALIA June 2013 DIGITAL MEDIA & WORLD PRESS TRENDS 2013
available at
http://www.ediland.it/new/documenti/WANIFRAItalia2013_02_peyregne.pdf
[4] Indian audiences are open to a combined print-digital model of newspapers
available at http://www.impactonnet.com/ accessed 11 October 2013
[5] Print special, August 2013 Special Report Emerging still
http://www.afaqs.com/all/news/misc/38475_Print_Special.pdf