Year Ender 2021: Volumes return, revenue still remains a challenge for the print industry
Even as the print industry posted a growth in the volume of advertising, in terms of revenue it has yet to play catch up. The return in volume has yet not resulted in return of revenue, completely. According to data released by TAM Media Research, the print industry this year has already reached 82% of the pre-covid levels and posted only an 18% drop in ad volumes in 2021 as opposed to 2019. “From an AdEx point of view, the situation became better from May onwards. While May-July was normal like any pre-covid year, the August-November period saw a tremendous rise in ad volumes. Furthermore, this year the industry saw over 2,500 new advertisers coming on board,” Ramsai Panchapakesan, SVP and national head – media buying, Zenith India told BrandWagon Online.
Interestingly, the industry seemed to have benefitted on the back of a robust festive season. Data indicates that advertising volumes for the print industry peaked in the month of October, registering an 87% increase in October 2021 when compared to January 2021. Furthermore, categories which were skewed towards TV, also joined the bandwagon as it upped ad spends. For instance, Hindustan Unilever- the top spender on the television, is the tenth biggest advertiser on print in 2021. For industry analysts, with more advertisers and categories coming on board, the dependency on any one sector for ads has reduced.
As uncertainty continues to loom due to the on-going pandemic, the industry is relying on what is to be believed a volume play as opposed to value. Hence, inventory is bundled and sold. Even as this has resulted in the increase in volume of ads, the move has adversely impacted the yield which has dropped. For example, weekend editions are bundled and sold with the city. “In 2021, we will see a lot more ad bundling solutions wherein print will be bundled with digital,” Jehil Thakkar, partner, Deloitte India, said.
As per industry estimates, in terms of pricing, about 90-95% has been corrected in 2021. This has been achieved through two ways – first pull outs have been merged as part of the main edition, besides reducing the number of pages. The new pagination has allowed newspapers to cut down on freebies. Hence, ad volumes are expected to return to 2019 levels by next year, while ad revenue is estimated to rebound by Q12023. This year, advertisers focused more on building brand image and targeting specific consumers rather than the mass. However, Panchapakesan believes that this will change next year as companies will step into the brand building phase and thereby move to print.
On an overall basis the print industry posted an 18% drop in AdEx. Within this, English and Hindi newspapers have registered one percent and three percent hike in ad insertions in 2021 when compared to 2019, respectively. Meanwhile, regional publications posted a three percent decline in ad volumes. Another reason that adversely impacted the industry was the increase in dependency on television and digital to advertise in 2021.
“For regional, the advertisement base is very local in nature with a dominance of classifieds and local business’ ads. If the threat of Omicron doesn’t turn into the third wave, then we can expect the regional print industry to come back to 2019 levels by 2022 summer,” Interestingly, advertorials have posted an increase, especially in the case of FMCG as a category. As per analysts, varied ROI-linked loyalty programmes have been rolled out by publishers this year. Industry estimates see these trends to continue for the next year as well.
Meanwhile, the industry is hopeful of a revival and expects the overall AdEx to cross 2019 levels by the third quarter of next year. Further, as five states enter the election phase next year, the industry is looking at 15-18% rise in ad volumes. As per industry estimates, UP is a big market for English and Hindi dailies because of the sheer number of seats up for elections. Hence, the BJP’s Yogi Adityanath led UP state government has begun to advertise. However, Thakkar believes that in 2022, the print industry will see more of an outsized effect wherein other categories – brands in this spend more in an effort to ride the election wave, “ Not to mention election is a short term boost, which does not help in long term sustainability.”