Advertisers in India are not giving up on newspapers just yet, despite the recent turmoil in the industry which saw mass layoffs to cut costs.
Advertising in print newspapers and magazines is expected to grow by a “modest” 4.5% in 2017, according to a recent report by media agency GroupM, which forecasts such trends around the world. Other large markets, including Russia, the UK, Brazil, China, Germany, and the US, are in the meantime likely to witness a decline as print loses readers to online media.
“India is the only large market in the world where print is growing,” the report, titled “This Year Next Year,” said.
India’s newspaper industry is estimated to be worth over Rs28,000 crore. Many of its over 82,000 publications cater to small towns and cities and are printed in regional languages. Print attracts 30% of ad money but trails television, the most preferred medium among advertisers. Yet, some of the largest Hindi-language dailies reach millions of households every morning, making newspapers key to how Indians consume information.
However, mobile phone penetration and better internet connectivity have shaken up print’s dominant position.
Amid this shift to online news, top print media companies are struggling to grow their readership. The ABP Group, publisher of English language daily The Telegraph, and HT Media, owner of the Hindustan Times and Mint newspapers, recently slashed their workforce and shut down smaller bureaus.
Like their counterparts abroad, Indian households are spending much more time on online content (pdf). So, GroupM expects advertisers to nearly double their spending on digital media to Rs9,490 crore in 2017, up from Rs4,950 crore in 2015.
In all, GroupM expects advertisers to spend Rs61,204 crore in 2017 across media, up 10% from last year. Though this growth is still lower than the longer industry trend, sustained urban demand, and the impact of key policy reforms such as the goods and services tax (GST), are expected to boost this figure.
The agency also expects a slow start to 2017 as companies are yet to recover from the impact of demonetisation which pushed them to postpone big spending. A recovery is expected only by March-April, according to CVL Srinivas, chief executive of GroupM South Asia.
In any case, media and e-wallet companies are likely to be the big advertisers this year. Political and government campaigns, too, are bringing in money for regional TV channels and newspapers.