13 October 2006

India’s quiet revolution

It’s a shame that many in India think advertising is a bad thing. That it’s distasteful. That, being at the cutting edge of capitalism, advertising is tool to make people buy what they don’t need. That India, struggling with her poverty and her low per capita income, can do without it. This belief, a fallout from our pre-Independence days when Indians had a negative disposition towards anything British, is partly responsible for the poor growth of regional-language newspapers in India. Advertisements in newspapers were considered such a British capitalist thing… to be discarded and trodden upon.

And so, for a long time in India, English newspapers walked away with all the advertising money, leaving regional-language newspapers to flounder like fish out of water. Printing machinery supporting Indian language scripts were difficult to find. Cost of newsprint was high (Indian-language newspapers consumed more newsprint as the scripts took up more space for the same amount of copy). And the distribution channel – the newspaper hawkers – took away a fair share of the income. Income from circulation was too little to sustain a regional-language newspaper on its own.

The central and state governments stepped in to rescue the situation and, despite criticism against them, became large advertisers for India’s regional-language newspapers. Leading the show was central government’s Directorate of Advertising and Visual Publicity (DAVP), which still contributes a substantial amount to regional-language advertising, with individual state governments joining in in support of their own vernacular newspapers. Even then, it wasn’t much. Post-Independence, the bulk of advertising spend came from commercial advertisers; and they believed that people with purchasing power could only be reached through English newspapers and magazines. This belief ruled advertising spends in India until recently.

In the eighties, with offset printing technology supporting their enterprise, regional-language newspapers and magazines finally saw a turn in the tide. They could print more, faster and cheaper than ever before; and distribute their publications in the rural markets of India where English newspapers had no presence. With over 70% of India’s population living in rural India, advertisers saw this as an opportunity, re-designing and re-packaging their existing products, or creating new ones, to address the needs of the rural markets… spending good money on advertising in vernacular publications. Circulation figures for regional-language newspapers soared and, with it, advertising revenues.

The Indian-language newspapers gained prominence, fulfilling a dual role. They covered local news, incorporating the culture of the region and connecting with their readers. At the same time, they brought national (and international) news and information about products and services into the household of the rural Indian. Both regional/local as well as national advertisers woke up to this fact and increased their advertising spends in vernacular newspapers. According to Aroon Purie of India Today, in the Frames 2006 conference organised by FICCI in March this year, there is a heavy growth in vernacular publications, with Hindi publications growing at 68% and Telegu publications growing at 63%.

However, all was not hunky-dory for the vernacular publications. At the same conference, Jacob Matthew of Malayala Manorama stated that, during 2002-04, although advertising contributed 60% of revenues, most vernacular newspapers dependent on revenues from circulation as well – some even for their survival. Apparently, of the total advertising pie of Rs.10,900 crores for print advertising in India (from a PWC-FICCI study which was launched in Frames 2006), English publications still cornered 50% of advertising revenues. Perhaps, we haven’t got over our English hangover yet.

Nevertheless, a 50% chunk of the print advertising revenue pie is a huge gain for regional-language newspapers. With growth pegged anywhere between 12-16%, it’s likely to overtake spends in English publications very soon. I’d say, this is nothing short of a revolution.

[Here’s more data from Frames 2006: S K Arora, Secretary of the Information & Broadcasting Ministry, commented that print readership in the urban sector was flattening out, but there were superb gains in the rural market. These gains were coming from approx. 47,000 Indian-language publications, of which 22,000 were in Hindi and the rest in 90 regional languages. (Apparently there are 9,000 English publications in India.)]

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