INTRODUCTION

Advertising What is Advertising? Advertising is a non-personal form of promotion that is delivered through select ed media outlets that, under most circumstances, require the marketer to pay for message placement. Advertising is, in fact, the most prominent and powerful medium in the present c ommercial world. It creates an entire world view, shaping our attitude and belie fs. Advertisements permeate every aspect of life and most of us are hardly aware of it. it largely depend on how an individual bring works and so utmost care is taken to exploit the emotions that play an important role in establishing a fi rm memory of an advertisement and predisposing the consumers to buy the brand th at is being advertised. Over a period of time, advertising has been undergoing m orphing changes slowly and steadily with multi-facet approach. Advertising has long been viewed as a method of mass promotion in that a single message can reach a large number of people. But, this mass promotion approach p resents problems since many exposed to an advertising message may not be within the marketer’s target market, and thus, may be an inefficient use of promotional f unds. However, this is changing as new advertising technologies and the emergen ce of new media outlets offer more options for targeted advertising. Advertising also has a history of being considered a one-way form of marketing c ommunication where the message receiver (i.e., target market) is not in position to immediately respond to the message (e.g., seek more information). This too is changing. For example, in the next few years technologies will be readily av ailable to enable a television viewer to click a button to request more details on a product seen on their favorite TV program. In fact, it is expected that ov er the next 10-20 years advertising will move away from a one-way communication

model and become one that is highly interactive. Another characteristic that may change as advertising evolves is the view that a dvertising does not stimulate immediate demand for the product advertised. That is, customers cannot quickly purchase a product they see advertised. But as mo re media outlets allow customers to interact with the messages being delivered t he ability of advertising to quickly stimulate demand will improve.

Advertising Features By looking into the meaning and definition of advertising we can sum up the foll owing features of advertising. Non- personal presentation of message: In advertising there is no face-to-face o r direct contact with the customers; it is directed to the prospective buyers in general. Paid form of communication: In advertising the manufacturer communicates with pr ospective customers through different media like, newspapers, hoardings, magazin es, radio, television etc. He has to pay certain amount for using some space or time in those media. Promotion of product, service or idea: Advertisement contains any message regard ing any particular product, service or ever an idea. It makes people aware about the product and induces them to buy it. Sponsor is always identified –The identity of the manufacturer, the trader or the service provider who issues advertisement is always disclosed. Communicated through some media- Advertisements are always communicated through use of certain media. It is not necessary that there will be just one medium. Al l the media may also be used. Types of Advertising If you ask most people what is meant by “type” of advertising, invariably they will respond by defining it in terms of how it is delivered (e.g., television ad, rad io ad, etc.). But in marketing, type of advertising refers to the primary “focus” o f the message being sent and falls into one of the following four categories: Product-Oriented Advertising Most advertising spending is directed toward the promotion of a specific good, s ervice or idea, what we have collectively labeled as an organization’s product. I n most cases the goal of product advertising is to clearly promote a specific pr oduct to a targeted audience. Marketers can accomplish this in several ways fro m a low-key approach that simply provides basic information about a product (inf ormative advertising) to blatant appeals that try to convince customers to purch ase a product (persuasive advertising) that may include direct comparisons betwe en the marketer’s product and its competitor’s offerings (comparative advertising). However, sometimes marketers intentionally produce product advertising where the target audience cannot readily see a connection to a specific product. Market ers of new products may follow this “teaser” approach in advance of a new product in troduction to prepare the market for the product. For instance, one week before the launch of a new product a marketer may air a television advertisement procl aiming “After next week the world will never be the same” but do so without any ment ion of a product or even the company behind the ad. The goal is to create curio sity in the market and interest when the product is launched. Image Advertising Image advertising is undertaken primarily to enhance an organization’s perceived i mportance to a target market. Image advertising does not focus on specific prod ucts as much as it presents what an organization has to offer. In these types o f ads, if products are mentioned it is within the context of “what we do” rather tha n a message touting the benefits of a specific product. Image advertising is of ten used in situations where an organization needs to educate the targeted audie nce on some issue. For instance, image advertising may be used in situations wh

ere a merger has occurred between two companies and the newly formed company has taken on a new name, or if a company has received recent negative publicity and the company wants to let the market know that they are about much more than thi s one issue. Advocacy Advertising Organizations also use advertising to send a message intended to influence a tar geted audience. In most cases there is an underlying benefit sought by an organ ization when they engage in advocacy advertising. For instance, an organization may take a stand on a political issue which they feel could negatively impact t he organization and will target advertisements to voice their position on the is sue. Public Service Advertising In some countries, not-for-profit organizations are permitted to run advertiseme nts through certain media outlets free-of-charge if the message contained in the ad concerns an issue viewed as for the “greater good” of society. For instance, ad s directed at social causes, such as teen-age smoking, illegal drug use and ment al illness, may run on television, radio and other media without cost to organiz ations sponsoring the advertisement.

Objectives of Advertising You have learnt that the main purpose of advertising is to communicate massage o r information to the customers. But while communicating such message or informat ion it also serves purposes beneficial for the sponsor or advertiser. Let us loo k into the various objectives of advertising. i. To educate customers Can you remember the advertisement of Dandi Namak on television? In this adverti sement it is said that Dandi Namak is good for health as it contains Iodine. Thi s message educates you that iodine is good for health and Dandi Namak contains i odine. ii. To create demand for new product You read in newspaper that a new type of pen called ‘Gel pen’ is introduced in the m arket, which is very economical and convenient in writing. This motivates you to buy the said pen. Similarly, many students like you shall also buy gel pen afte r coming to know about it through advertisement. This will create a demand for t he new product launched in the market. iii. To retain existing customers You might remember that Nirma washing powder was a very popular detergent. But, after Wheel powder came to the market the sale of Nirma suddenly decreased. Then the manufacturers of Nirma improved the product and advertised about the same i n different media. After knowing this the persons who were earlier using Nirma d id not switch over to Wheel and continued using Nirma. In this manner Nirma sust ained its existing demand. Thus, advertising helps the manufacturers not only to create a demand for a new product but also to retain the existing customers. iv. To increase sales We have learnt that advertising creates demands for new products and sustains th e demand of old one. Thus, with increase in demand, the sale of the product also increases. v. To assist salesman

its qualities and its uses are expressed in detail. It inc ludes advertising through newspaper. Institutions involved in field of Advertising Management The concept of markets and consumer will be use interchangeably to refer to any classification of individuals. . the same advertisement can be repeated frequently and remind reader everyday.1 Markets and consumer behavior Figure 1. This assists a salesman to sell the product quickl y without spending time in explaining and conniving the customer. Newspapers are read soon after they are received and then are kept generally in some corner of the houses. opinion s and current events. H ence. • Advantages i. organization. Generally newspapers are published daily. The advertiser communicates his message through newspaper which reac hes to crores of people. journals. Newspapers are also a very common medium of a dvertising. In our country newspapers are published in Englis h. These are the sources of news. or groups the advertiser is attempt ing to reach or “get a message to” Figure 1. iii. Thus. After 24 hours we get a fresh newspaper and this m akes the life of the newspaper short.2 Media of Advertising Print Media Print media is a very commonly used medium of advertising by businessman. region and readers through local or regional language • Limitations i. This makes advertis ing quite flexible. Newspapers You must have read Newspapers. they provide greater choice to advertisers to approach the desired market. Newspapers normally have wide circulation and a single advertisement in the n ewspaper can quickly reach to a large number of people. The cost of advertising is relatively low because of wide publication. Hindi and in other regional languages. Newspapers are published from different regions and in different languages. Even last minute changes in the content is also possible. In addition. magazines. ii. and is also calle d press advertising. v. iv. The matter of advertisement can be given to newspapers at a very short notic e.In most advertisements the salient features of a product. etc.

However. while driving you can hear a ra dio but cannot read a newspaper. Frontline. which is a magazine for women. advertisements related to products to be used only by males are rarely published. ii. ii. Nandan and Champak in Hindi. (One of the longest run programme in Radio was a sponsored programme started as “Binaca Geetmala” and later renamed as “Cibaca Geetmala”. These may be published on a weekly. iii. Illiterate persons can not read and thus. iii. (ii) It is also useful to illiterates. All these periodicals have a large number of readers and thus. etc.ii. For example you must have come across magazines and journal s like Onlooker. This inc ludes Radio. India Today. Similarly. toothpowders and tooth bru shes and it continued for a period of 30 years on a weekly basis). fortnightly. But. you can hear radio while traveling on road or working at home. For exam ple. These are preserved for a long period to be referred in future or read at leisure or read again. occasional listeners tend to forget what they have heard in Radio. Femina. advertisements published in them reach a number of people. (iii) There are places where newspapers reading may not possible. wheneve r required. • Advantages i. It was sponsored by Hindustan Ciba-Geigy Limited for its products like toothpastes. manu facturers of products and services to be used by females prefer to give advertis ement in this magazine. • Limitations i. Radio Advertising All of us are aware about a radio and must have heard advertisements for various products in it. Swagat. In radio there are short breaks during transmission of any prog ramme which is filled by advertisements of products and services. Periodicals have a much longer life than newspapers. • Advantages (i) It is more effective as people hear it on a regular basis. but you can not read newspaper. For example. The advertisement materials are given much in advance. Periodicals have a selected readership and so advertisers can know about the ir target customers and accordingly selective advertisements are given. People read newspapers mainly for news and pay casual attention to advertise ment. hence last minute ch ange is not possible. The number of people to whom the advertisements reach are small in compariso n to newspapers. published regularly in English. newspapers advertising does not b enefit them. bimonthly. quarterly o r even yearly basis. There are also popular programmes sponsored by advertisers. Television and Internet. • Limitations (i) A regular listener may remember what he has heard. Periodicals Periodicals are publications which come out regularly but not on a daily basis. Grihasobha. Advertising in periodicals are costlier. Let us look into detail about these. Similarly there a re also periodicals in Hindi and other regional languages. (ii) The message that any advertisement wants to communicate may not be proper a . who can not read and write. Yojana. Electronic Media This is a very popular form of advertising in the modern day marketing. but you can he ar radio. monthly. This reduces flexibility. in a periodical like Femina.

(iii) It is not suitable for illeterate and those having no knowledge about the operation of Internet. who can forget A amir Khan saying “ Thanda Matlab Cocacola” or Sachin Tendulkar in Pepsi advertisemen t. However. television has topped the list among the media of advertising. • Limitations (i) TV advertisements are usually expensive to prepare as well as to telecast. their uses can b e demonstrated and their utilities can be told over television. • Advantages (i) It is most effective as it has an audio-visual impact. (ii) With catchy slogans. (iii) With varieties of channels and programmes advertisers have a lot of choice to select the channel and time to advertise. Advertising (ii) With almost every manufacturer trying to communicate their message through TV advertising the impact among the viewers is also reducing. Moreover in all these media. advertisements are shown in TV during short breaks and there are also sponsored programmes by advertisers. Just like radio. Internet Are you aware about internet? Infact it is the latest method of communication an d gathering information. TV has the most effective impac t as it appeals to both eye and the ear. Other Media All the media of advertising discussed above are mostly used by consumers while they are at home or inside any room. Products can be shown. • Limitations (i) It is not accessible without a computer. wher e the consumer has to spend nothing and he can see such advertisements while mov . famous personalities exhibit ing products. If you have a computer and with an access to internet y ou can have information from all over the world within a fraction of second. Radio is less effective as it lacks visual im pact. (ii) User can see the advertisement at their own time and as per their requireme nt.s there is no chance to hear it again immediately. (iv) With regional channels coming up any person even illiterates can watch the advertisements and understood it by seeing and hearing. For example. (ii) It is not very suitable for general public. except radio and newspapers or magazines to some extent. song and dance sequences. the consumer has also to spend some m oney to access the advertisement. Television Advertising With rapid growth of information technology and electronic media. In almost all the search engines or portals different manufactures or service providers advertise their products. Now-a-days people are switching on channels whenever there is a commercial break. (iii) In comparison to Television. Thr ough internet you can go to the website of any manufacturer or service provider and gather information. there are other media available. There may be some other distu rbances that distort communication. Sometimes when you do not have website addresses you tak e help of search engines or portals. • Advantages (i) Information from all over the world is made available at the doorsteps. TV advertising has a lasting impact.

etc. where the hoardin gs are placed. etc. the shopkeeper sometimes gives you a key ring to hold the cycle key. Unlike hoardings these vehicles give mobility to advertisements and cover a l arge number of people. While using. address and telephone number of the manufacturer. the user remembers the products as well as the producer. The advertisers have to pay an amount to the owners of the space. trains. et c. These are normally boards on which advertisements are pain ted or electronically designed so that they are visible during day or night. Posters of films which are screened on cinema halls are a common sight in our country. Some of such advertising are hoardings. buildings. or trader or service provider as well as descriptions of the prod ucts in which they deal in are printed. Posters Poster are printed and posted on walls. gift items. posters.ing outside. calenders. Som etimes manufacturers gives diaries. Hoardings While moving on roads you must have seen large hoardings placed on iron frames o r roof tops or walls. Vehicular displays You must have seen advertisements on the public transport like buses. Global Scenario . to buyers and prospec tive customers. In all these items the name. purse. These items are normally items of daily use given freely to the customers. Gift Items from manufacturers When you buy a cycle. vehicular displays . Some jewelers give small purse or boxes when you buy a jewellery. bridges etc to attract the at tention of customers.

who were aggressively selling to the local buyers. the largest North American newsprint p roducer accounting for almost 50% marketshare. The Chinese equation The Chinese suppliers. one of the main raw materials for r ecycled Chinese newsprint has seen an increase in price ranging from $130 to $27 0 per ton. global demand for newsprint was 38. have been able to purchase import ed newsprint (largely from North America) at competitive prices owing to a posit ive supply scenario (vast capacities created by international newsprint manufact urers). declining demand in UK and parts of Europe and strong push by Chinese ne wsprint companies into the Indian market. The ris e in newsprint prices during the period was attributed to steady demand and cost push inflation. The merged entity announced closure of the 600. th e strong domestic demand in China is more of a transitory phenomenon and is like ly to witness moderation in 2HCY2008 leading to better supply situation. We have modeled in a 24% cumulative hike in newsprint prices over the next two y ears   . After bottoming out in July 2002 at US $430MT. over the last several years. We attribute the sharp rise in global newsprint prices to the following factors: Capacity rationalisation in North America In CY2007. At the beginning of CY2007. Rising crude prices High crude prices at US$100-105 per barrel are pushing up freight rates as well as the cost of production of newsprint. the largest consumer. most Print Media companies reaped the benefi ts of lower newsprint costs on account of the dual benefit of declining newsprin t prices and rising Rupee. Newsprint prices to stabilize post 2HCY2008 We expect newsprint prices to remain firm and rise to higher levels in the near term. by the end o f 2007.000 ton/year Snowflake mill capa city resulting in an equation where the Top-five newsprint producers now account for over 80% of the newsprint capacity in the North American market. the scenario has now changed. However. the primary raw material for recycled newsprin t. Domestic consumption in China has also gone u p owing to the run-up to the Beijing Olympics.a surplus of 2.000 ton/year of capacity as a part of its r ationalisation plan and effected a price hike of US $60/ton for 1QCY2008. In FY2008 however. Old News Print (ONP). Besides.8% yoy in CY2007 and is expected to remain subdued. several mills closed down resulting in a shortage of 2mn tons taking the prices up. is in short supply. the North American newsprint market was suffering from a large demand -supply gap keeping the prices under check.2mn tons. in the last 5-6 months. owing to the merger of Abit ibi and Bowater to create AbitibiBowater. newsprint prices were on a steady rise for almost four years and peaked at US $640MT levels in July 2006. we note that newsprint demand in the US. However. Newsprint prices in CY2008 have already risen 10-12% to US $640MT le vels with more hikes anticipated in the near future. Catalyst Paper acquired AbitibiBowater s 375. However. Furthe r. have p ulled out as recycled newspapers. ha s declined by 10.3mn tons while the g lobal supply was at 40.Impact on Supply and raw material side Newsprint prices in CY2008 have already risen 10-12% Indian companies. But. a highly energy-intensive process.5mn tons . this gap has vanished.

Indian consumer has developed a treatment for the swift transformation that has taken place in the strategy and presentation of ads. as it simplifies the language. and improved the potential of the creative vehicle and the actual performance in the market. radio and television. Advertising provides a free rein to the art of persuas ion. we believe the smaller publishers. the trend of using Hinglish is gaining prominence and emerging as a language most suited for Indian advertising and the fact that brand ambassador like Amirkhan speaks this language in the ad reflect s the confidence of the advertiser. today. which largely depend on circulation revenues. Rising cost pressures likely to lead to industry consolidation If newsprint price hikes sustain at this rapid pace for another few quarters. We believe HT M edia is the most sensitive to newsprint price hikes owing to its large circulati on base. The large newsprint publishers are in a better position to absorb the hikes owing to their strong Margin profile. Proper research is carried out to significantly reduce the risk involved in adve rtising task. it is much more than a few printed lines or more pictures with som e printed text. Thus. The language used in the advertisement is influenced by many sociologica l factors like market. and games. most large publishing companies have strong cash flows and balance sheet. We believe the Newspaper publishing companies are likely to u se a combination of counter-strategies to mitigate the impact of rising newsprin t prices to protect their Margins and remain competitive. The use of English words in between Hindi words or Multilanguage to c reate a ‘special effect’ is becoming a fashionable trend it is more accessible to al l. sports. high Operating leverage and ability to garner high amount of advertising revenues. rural market. Our S ensitivity Analysis indicates the impact of an additional 100bp rise on EBITDA a nd PAT on our base case assumptions for the different companies. w ill likely witness sharp erosion in profitability rendering their business model unviable. With the development of pri nt media. All these have the potential to influence our rationa l consideration for making purchase Brand ambassador are used by companies to attain some definite objectivity. which gives them the additio nal advantage to explore acquisition opportunities. Practice of Multilanguage an d translated syntax like Fruit salad ehk minute main or Ek dum fit appeals to people of all regions across the count ry.For our Print Media universe. Indian Advertising India is an immerging market and Indian advertising has remained robust despite the signs of sluggishness. Indian advertising is a vast field where new trends are continuously emerging ev eryday. which arise due to changing business dynamics. sundry and real. advertising also score high and various media st rategies are now employed to meet different advertising needs. religious and education. It is like a kaleidoscope exhibiting different perspectives enth ralling. Moreover. we have modeled in an 18% rise in newsprint prices in FY2009E from $600/ton as a base case followed by a 6% jump in FY2010E. higher use of imported newsprint and higher pagination compared to its peers. politics. Seei . The Amul ads were one of the first to use Hinglidsh to great effect “Amul Big b oss of Makkans”. adapting itself to changes with passing time. The field of advertising has progressed in leaps and bonds.

the use of word-o f-mouth to express approval and administration for products. some two thousand years back during the reign of Kumar Gupta. Indian Merc hant’s Slik clothes weaver’s cooperative association had in described an advertiseme nt in the form of a poem on a wall of a sun temple in Dasapur (now called as Mad sour in MP) which is consider as one of the oldest advertisement in the world. or service by a branded supporter endeavoring to inform or influence a particula r target audience.ng his favorite celebrity in an advertisement motivates the consumer to use the product. robust changes are seen in advertising also. Hawkers use t . public endorsement of a cause. product. Examples of this were discovered by archeologists’ ancient wall paintings announcing fights of gladiators. The practice of using trade mark is seen ancient civilization also. At the commencement of advertising. The people who performed wordof-mouth services were called caries and they were citizens who were responsible for reading out public notification. Researchers revgeal that earlier hawking was also one of the popular medium of advertising. This outdoor advertising was normally in the form of an attractive sign which was painted on a building wall. Advertising has adopted many dissimilar forms since the initi al period of time.hordings and signage seen near bus stop and at the back of the vehicle are the developrd version of information or messages with the trade mark on the wooden planks. This people were also haired by traders to shout out and express approval and admiration of their articles which were bein g offered for sale. led to generation o f an elementary but powerful form of advertising. the bu sinessmen in early Egypt made use of caries to proclaim or announce the arrivals of ships along with the arrivals of cargo. fre scos. Evidence has been discovered by arch aeologists of the fact that advertising. The origin of Hindi advertisement is not known or cannot be stated as clearly. Before the development of print media. and hawk ing were the means of advertisement. metallic plates or stones use in the olden days. History Advertising is attracting the interest of the public towards the goods and servi ces by endorsements which are performed with the help of a range of media. These ordinary town criers were the people wh o gave rise to the concept of the current day announcer who presents radio and t elevision commercials. Today. Rajas and maharajas royal orders were displ ayed as fresco or work embedded in the wooden planks. online marketing and mobile marketing growing at rapid speed targeting the ever increasing number of Indian web users in all possible promising ways. Latter on this people become a regular feature on the street s of various colonial settlements. N early. Advertising is frequently c onsidered as the compensated. Some of these m essages were signs relating to certain real estate for purchase or rent and some where signs trying to bring to the notice of travelers the availability of guest house located at another location. an example of which is. outdoor display was the first to be rec ognized. It is an important part of an overall marketing strategy. The religious messages ins cribed on the Stupas in Sanchi are examples of such advertising. With the dev elopment of civilization . The archaeologists have discovered quite a few signs. In the current scenario. particularly at sites like ancient ruins and caves. They also discovered paintings on ro cks that were used to advertise commodities. companies are experimenting with novel techniq ues to attract consumers. it was simply a proclamation or an announcement. They are constantly looking at new apertures to market . It was discovered that in the era relating to the middle ages. proposal. carving on the rocks and pillar.

printing also expended and develope d. Earlier. Neither during the time of East India company not d uring the British reign advertising was given much significance. mera chana bana hai aala……” yes. After that the demand has been increasing. Similarly. On the other hand the message of the commercial nature a nd displays of the political campaigns have been found in the ancient ruins of t he countries like Egypt. But. Painting on the walls and rocks for t he purpose of the commercial advertising is another demonstration of an early fr om of media advertising. Superior visual and portraits were used in adv ertisement published after 1954 which targeted the larger consumers over a large r geographical\al area. 1780. advertising developed and went on to incorporate handbills. prin ted advertising made slight progress until the innovation of the printing press. the effort behind contemporary a dvertising is to “generate a demand” by manipulating the apparent wants or need or w ish of the buyer.o cry out the quality of their products In a musical way to attract people in th e states and lanes. particularly during the period of the 15th as well as 16th centuries During t his period. for example the ad Poorn Bharatya parentu aayuthith bootom thatha jootham ke sa maan ( totally Indian but equal to imported boots and shoes) was published by St tewart factory . These advertisements were economically priced. Agra. the most widespread type of advertising was done by word-of-mouth. Along with this other messages. Government adve rtisement contained only vacancies and tender notices. mostly of East India companies. The use of idioms and phrase was an added advantage to create a strong identity for the product. messages and pert aining to lost and found contain were a common from of advertising in the primev al times in countries like Rom and Greece. agencies were working a single sided basis and were not much interested in criticism or views and response from others. In primeval times. Latter o n the period of the 17th century advertisement began to appear in the tabloids a nd newspapers. If they were any other ad vertisement then they published in the government gazette whose circulation was very limited and so was far above the reach of the common people. Even though pictorial type of advertising becomes visible early on history. Who can forget this popular jingle. India’s first newspaper Ben gal Gazette most published on June 29. This initials advertisement in the print media was made use of pr imarily to endorse books and newspapers. which still can be found to exit in quit few parts of A sia and Africa. Advertisers were using language enriched with theoretical devices. moder n Indian consumers are moving towards experimenting conspicuous consumption The consumer buys a produce most probably because the consumer identifies a requ irement or want for it. With the development of the printing press. During the period su ccess of the newspaper depend largely on the financial help received from the ad vertisement published on it. the main intension behind the advertising was only to t ransmit the information. sales messages and wall posters had also been found in the ruins of Egypt. During the mid 1980s advertisement having a poetic style became very popular. such advertisemen . where four pages were set aside exc lusively for including ads. With the availability of products increasing manifold. which touch the heart an d leave an evergreen print in the minds of the mass ? “babu mein laya majedar cha nanchor garam. on the one brand. The spread of jingoistic feelin g and xenophobic attitude was echoing in the advertisement published after 1902. Up to the 20th century. thanks to the advent of the printing press. and hence. The consumer makes decision with respect to the brand to be purchased and whom it is to be purchased from. The prospective of advertising escalated when manual press was invited in the 15 th century. which differed from the ordinary course of idea and subsequently genera ted larger upshots. hawkers had a very unique musical styl e of magnetizing people an popularizing their products. various properties of th e products were elaborate using idioms and phrases that helped to showcase them in a better way. The knowledge of their option s and an assessment of the alternative have an effect on the consumer’s decisions. To popularized product identity.

it is the growth of each specific medium and the traits that describe than and that in turn impacts the way in which he advertising industry has developed. in turn influenced the progress and expansion of the adve rtising industry the time when the first commercial appeared on television. Some channels of media are dependent on the revenue generated through advertisin g right from the inception. classify advertising started becoming accepted and gaining populari ty. the necessity for advertising was also expanded at an even pace. while others become the outcome of commercialization . almo st every time there is ascertain amount of ambiguity as to the way it will advan ce and flourish. I is not at all possible to anticipated the definitive traits t hat will make it gel with popular culture. Ea ch specific medium has an intrinsic quality of marketing and the part that the v iewer plays inside the range of the text of an advertisement is connected with t he provisions and the limitations of the medium. For this reason . This industry has a 0. When something is new and one of the kinds. it becomes very hard to forecast and hypothesize. but also about the impression and impact it will have on culture lifestyle and also on society. closel y followed by the consumer durable segment and automobile industry. This industry boost because of big MNC in India. During the period of the 160s advertising started to advanced towards futuristic and a much more scientific process in which the artistic imagination was given to full scope to sparkle. Growth While making and appraisal about the effects of a new communication medium. comparison is made with the different types of media. it is necessary to understand the manner in which social development and political happenings have moulded the commercial media and.ts were very much affordable. During the period of the 19th century when the economy was growing at the franti c pace. The newspapers were full of different types of products. not only about the future op eration of the technology. there is nothing else which can be use as the basis for our expectations and hence.65% part of GDP growth. It i s also necessary to distinguish the way in which the identification of the mediu m influences the message and also evaluate the sociological influence of current fashionable advertising. which in t urn made advertising more attractive viewing for the consumers. . As we have seen that the retail ing sector is booming this will again also support the advertising industry as t he FMCG segment is the largest advertiser in Indian Advertising Industry. During this period. The effectiveness o f this type of advertising paved the way for mail order advertising in the form of catalogs. creating totally new and creative messages. To understand the growth of advertising industry.

marketing br anding and public relation services keeping in mind the current pace at which th e Indian advertising industry is moving the industry is expected to witness The launch of TV service. During the period following the Second World War there was a very fast and strong growth in the economy of t he countries. After the Second World War. pre and post campaign analysis market research.Indian Advertising Industry size As consumer wallets swell and companies slug it out to capture a larger share of these wallets.based advertising campai .. Print Media continu es to account for the largest share of the advertising pie at 48. Analysts argued that th ere was a basic connection in way prints as well as TV. This breadth o f mass media will give huge market for advertisement.1% registering a strong 20. Print and Television are expected to converge in CY2011. about 200 million n ewspaper readers and about 38-million users of internet in India. in turn. buoyant economic growth and h igh growth in new media platforms are expected to drive a steady 19. But t his did not mean that the basic modus operandi used was largely diverse from the fundamental techniques used for advertising in the print media. Low ad spends relative to GDP. both the traditional platforms viz. Up till no w we see advertisement on television. media planning conceptualization. In terms of contribution to the total pie. print and radio. which were multi-se nsory in nature brought a fresh lease of life to the advertising industry. which was commercial in nature and sales reliant. India has about 350 millio n mobile phone users. TV advertising was considered to be a novelty and re volution and the people reacted very positively to advertising after the initial doubts and resistance. It is sure that in near future the mode of advertising and the present method of advertising will be changed by different mode and modern technology. The commencement of TV advertising was considered to be one of th e means by which it was possible to develop economy. There are about 70-million cable & satellite homes. The conception of the advertisement. the advertising industry continues to make its importance felt r egistering a robust growth of 21. The Indian advertising today handles both national and international projects.5% yoy growth during the year. The important a nd unique fact was that even though the modus operandi was same TV advertising e ffectively communicated the marketing campaigns in a way that was stimulating bo th to the eyes as well as the ear and this was very new. was seen as a major boost for the advertising industry.5%yoy in CY2007 to Rs195bn. this is also become a huge medium for this advertising ind ustry. the basis of which was comp etition. But now the scenario has changed.3% CAGR in r evenues for the advertising industry during CY2007-11. led to the necessity of creatin g new markets. t he reason that the industry offers a host of functions to its clients that inclu de everything form start to finish that include client servicing. This resulted in an increase in the levels of income and there was also an increase in production. which.

print advertisements are less open in their ability to provo ke emotions. the name of the product and the commercial technique of the product. There was awareness that businesses would have to vie for customers. the advertisement campaign for products of domestic use like c leaning products would time and again shows professionals or experts and endorsi ng the qualities of the product so as to induce a sense of unbiased credibility for the product. This association is allowed identification both on the screen and the off screen. liberated market. these commercials also are no table to convey the sequence of events and si nce they do not have the quality of narration. Lifestyl e advertisement depends on the desire of the viewer to acquire the qualities of . the feel was like watching a documentary. it is imperative that the advertisement itself compelling enough to stop us from switching channels or making use of the time b rew a cup of tea. Advertisements started to endorsed lifestyle advertisement . Along with the fact that TV advertising had the multi. they would not only be ale to c reate market for their brand but they would also retain the market from their co mpetitors. In the initial campaign of TV advertising. however. which was still in the p rocess of straying to prove its potential in area of marketing and also in the a rea of making profit. Therefore. During this period. it was apparent that conveying the ch aracteristics and advantage of product was essential and imperative. was considered to be a risk. signifying to the observed the way in which the product be used. which is made available by the im ages with movement. bringing complication in to the area of play by bringing in componen ts like comedy. Brands were considered to be a means of developing links that would h elp the consumer in associating the product with its packaging. TV a dvertising had the capability of entering the pirate zone and aim for the people inside their homes. But for the consumer. Hence. They stressed that both the types of advertisement stressed the endorsement of concern. But in being so. advertisers were at a distance and prefer to refrai n them selves from being to experimental. Advertiser felt that a sense of truthfulness was vital in connecting the trust factor with a particular brand. Just like the newspaper. in retrospection. the largest consumer groups were women and t he priority of the advertisers was to attain loyalty towards their brand. also claim that in spit of being extremely effective. The result of this was a multitude of advertisement that gave accurate information. as and for t hat reason. as advertisers placed enamors importance on the necessity of generating an exclusive brand but ignored the necessity to create a center of attention for the product. For e. Products became linked with particular kinds of populace or movement and would time and again be revealed only at the conclusion of an advertisement. The in tention behind this was that with brand loyalty. Retailers were seriously investing to promote their products on a commercial media outlet. The initial period was one of the setting up advertising standards. commerci als in the print media are successful because they are very simple. fright or want and the perception of product awareness.gn was created.. Advertisement campaign for indulgences like chocolates and alco hol were associated with fancy desire and pleasurable feelings. Alternatively they prefer to ensure th at the contain of advertisement was presented lucidly and accurately. some advertisements seem to be bit immature an d prehistoric when they are compared to current examples. Analyst. and advertisements of the time mirrored this.g.sensory feat ure the fact that truly separated it from advertising in cinemas was the fact th at the nature of TV advertising was very domestic. Advertisemen t developed and become more stylish. On the other hand. In contemporary society. The idea of endorsing a brand name was thought to e the most vital in advertisin g during 1960s. During 1980sadvertising began to mirror more powerfully the economic principles of a spirited. we are inundated with media communication and continuously exposed to h ousehold disturbance. Branding was successful in creating an intrinsic association connecting the product and the campaign.

These include outdoor billboards that alter disp lays as cars containing geographic positioning systems (GPS) and other recogniza ble factors (e. is known as dig ital information. Any media outlet that re lies on computer technology to manage the flow of information does so using elec tronic signals that eventually form computer data. digital data. For instance.g. Some argue that change has affected advertising more than any other marketing function. The latter period off the 1980s and the initial period of the 1990s witnessed the launch of cable tele vision and what stood out in particular was MTV.the individual in the advertisement and for that reason they resorted to a resou rceful method of aiming at specific collection of people. The future holds even m ore convergence opportunities. it also w orks with information being sent from the customer. by clicking on their television screen viewers will soon be able to inst . electronic d ata is represented by either an “on” or “off” electronic signal. advertising is changing rapidly. namely. and more appropriately digital convergence. All digital information can be stored and later evaluated. For example. In computer language t his is further represented by two numbers “0” and “1” and. in many areas around the world television programmi ng is now delivered digitally via cable. This de livery method uses the same principles of information delivery that is used to a llow someone to connect the Internet. To day’s ads are made so creative and unique that it gave new birth to new concept “BRA ND LOYAL” Like most areas of marketing. Earlier the ad was me ant for general know for consumer but now it is all about MIND & HEART share. For instance. MTV brought in an innovative style of advertising: the customer watches the channel with the intension of specifically watching the adv ertisement. Today ads have made unique image in consumers mind. telephone or satellite hookup.. Being the groundbreaker in the idea of the music video. as we noted e arlier. the potential exists fo r greater tracking and matching this with information about the person receiving the digital data. consequently. In advertising convergence. The mor e important trends in advertising include: Digital Convergence While many different media outlets are available for communicating with customer s. GPS tied to satellite radio) pass by or direct mail postcards that carry a different message based on data that matches a household’s address w ith television viewing habits Focus on Audience Tracking The movement to digital convergence provides marketers with the basic resources needed to monitor user’s activity. Many media outlets are experiencing convergence as can be seen with print publications that now have a strong web presence. Convergence allows one media outlet to take advantage of features and benefits offered through other m edia outlets. The convergence of television and Internet opens many potential opportunities fo r marketers to target customers in ways not available with traditional televisio n advertising. And tracking does not stop with what is delivered. technology may allow ads delivered to one household to be different than ads delivered to a neighbor’s television even though both hou seholds are watching the same program. F or media outlets delivering information in digital form. the ability to distinguish between outlets is becoming more difficult due to the convergence of different media types. refers to a growing trend for using computer technology to deliver media programming and information. Trends If we talk about present trend in this industry we could like simply say mind bl owing. But convergence is not limited to just t elevision. In simple form.

• Television recording – The days of television videotape recording are quickly comi ng to an end. advertising services can program the DVR to insert special advertisem ents within a program targeted to a particular viewer. Examples include: • Podcasting Audio – This involves delivering programming via downloadable online au dio that can be listened to on music players. Viewer convenience is not the only advantage of the DVR. such as TiVo. albeit. the advent of digitally delivered television all ows cable. news and information. is in its infancy. consequently. Changing Media Choices There is a major cultural shift occurring in how people use media for entertainm ent. the d ownloading of video to small. Audience Concern with Tracking While media convergence offers marketers more options for tracking response to a dvertisements. This activity can be tracked then used in future marketing efforts. may contain a hidden surprise – spyware. are seeing their customer base eroded b y the emergence of new media outlets. Many traditional media outlets. In some cases spyware keeps t rack of websites the user has visited. Many television networks are now experimenting with making their progr amming available for download. such as Apple’s iPod. make suggestions for programs they may want to record. the DVR is changin g how people view television programs by allowing them to watch programming at a time that is most convenient for them.antly receive information about products they saw while watching a television sh ow. vid eo and software. a number of important applications tied to the I nternet are creating new media outlets and drawing the attention of many. • RSS Feeds – This is an Internet information distribution technology that allows fo r news and content to be delivered instantly to anyone who has signed up for del . Ad Skipping and Blocking As noted above. In particular. can track users recording habits and. Yet from the consumer side. such as games. As more DVR devices with ad skipping or even ad blocking feature s are adopted by mainstream consumers the advertiser’s concern with whether they a re getting the best value for the advertising money becomes a bigger issue. telephone and satellite providers to track user activity through the set-top boxes connected to a subscriber’s television. such as newspapers a nd major commercial television networks. handheld devices. Of course this presents major issues for advertisers who are paying for a dvertisements. Many news web sites and even other information site. replaced by recording using computer technology. such activity also raises ethical and legal concerns. Adv ertisers who feel frustrated with television ad-skipping may opt to invest their promotional funds in other media outlets where consumers are more likely to be exposed to an advertisement. • Internet Spyware – Downloading entertainment from the Internet. A digital video recorder (DVR). television recording devices offer marketers tremendous insight into viewers’ habits and behavior. including cellphones. mostly younger. Add itionally. The Internet has become the major driver of this change. The information is then used to gain an understanding of the user’s interests. based on a v iewer’s past activity. Many consu mers are not pleased to learn their activities are being monitored when they eng age a media outlet. which then results in delivery of special a ds when a user visits a certain site. such as blogs. offer free downloadable au dio programming. The other main reason consumers are attracted to the DVR is their ability to quickly skip over commerc ials. consumers. Yet consider the following examples of how marketers are tr acking users: • Television Viewing – As we noted. open to even more tracking. Future innovation will make the user television experience even more interactive and. for a fee. Spyware is a special pr ogram that runs in the background of a user’s computer and regularly forwards info rmation over the Internet to the spyware’s company. • Podcasting Video – While audio downloading has been available for some time.

they may soon offer such opportun ity.ivery. wit hin game play. it is difficult to . such as advertising. This type of set up will soon allow marketers to insert special content. As these technologies gain momentum and move into mainstream acceptance ma rketers may need to consider shifting advertising spending. Marketers should also be aware that new media outlets will continue to emerge as new applications are developed. For marketers these new technologies should be monitored closely as they become accepted alternatives to traditional media outlets. gaming sys tems attached to the Internet for group play is relatively new and becoming more practical as more people move to faster Internet connections. The bottom line for marketers is they must sta y informed of new developments and understand how their customers are using thes e in ways that may offer advertising opportunities Future The path that lies ahead for advertising being unpredictable. Clearly those registering for RSS feeds represent a highly targeted mark et since they requested the content. While these technologies ar e currently not major outlets for advertising. • Networked Gaming – While gaming systems have been around for some time.

the to find out more about specific products on television by just pressing a button on the remote or using a mouse to click on an adverti sement banner on the internet is the ultimate desire of a marketer. which by any measure. This concept has generated mainly because of the emergence and the popular ity of the internet. In the past. help to affect the way in which potential consumers associ ate with advertising. deve lops additional interest in the product. targeted advertise ment. with the demand for advertising. a registration from that offers a free trial or sample or even the option to make an immediate purchase transaction on the internet. he or she gets an opportunity to get directly associated with the product. which was one-way transmission only. making a vast variety of offers ranging from internet recharge coupons t o non chargeable access to thee internet. O n the whole.. watches digital television or advertisements on the on internet. in the case of this type of advertisin g. Also. the internet of fers options like a website for the promotion of products. which. a number of new advertising opportunities wh ich are able to instantly attract the attention of the consumer and encourage in teraction have been generated. particularly since the rise of “entertaining” advertising. An example of this is Football World Cup event. w hich is significantly on a come back trail. On the other hand. we can see that the electronic media enable direct. the advertising population has not yet been able to make this very simple even though some of them have started using the internet to spread extens ively their advertisement to any person who is willing and wishing to see or hea r the commercials. probably the most resourceful techn ique to convey a message was to cover the biggest mass market audience that was actually possible. . Major corporations functioned singularly on the revenue generated from adver tising. in turn. immed iate a collaborative communication between the customer and the seller/producer. Another noteworthy and important trend for the future of advertising is the incr easing significance of niche advertisement or in other words. Marketing activities with the help of internet created new boundaries for the ad vertisers and this opened the gates for the dotcom era to grow by leaps and boun ds. With each passing year.forecast and it depends very strongly on the trends in the media usage. With the emergence of the internet. bigger amounts are being paid so as to acquire a commercial spot durig world-famous spectacular event. Advertiser will have an ever-increasing capacity to get in touch with constricted viewers. By this. there will also be an increase in the dem and for advertising that is entertaining. The dis covery of new technologies and the provision of these technologies as a podium o n which to advertise. When the customer uses a mobile phone. The announce ment of mobile majors about the offer o put up the market airtime for advertisin g on its network was done with a plan to offer advertisers an express channel. is considere d to be the most major and the most significant football event of the relevant o r particular year. some consumers may be fond of a particular advertisement to such an extent th at they would want to watch the advertisement late or they may want to show the commercial to a friend. This was not possib le with the earlier print-based media and the media campaigns in the broadcastin g media.

To perform all the advertising activities there are different advertising agenci es.for 25 per cent of cost he sold space to advertisers in the various 14 00 newspaper through out the country. Kennedy believed that advertising was “salesmanship in print” and always tries to provide the reason why people should buy the advertiser goods. Creative Director. By the turn of the century. In small companies. Its time they make client s understand the two are partners who have only one Client: the Consumer ‘ Piyush Pandey . which in most cases. Different agencies have different policy and criteria for its client and the y create competitive edge on that basis only. whose manager reports to the wise p resident of marketing. Function of Advertising Agencies Professionals at advertising agencies and other advertising organizations offer . O & M A unique aspect of advertising is advertising agency. Palmer. makes the creative and media decision.Advertising Agencies “Ad agencies in India today are scared of their clients. K ennedy and Claude Hopkins. agencies started to focus their attention on the cre ation of advertising for clients. John E. Organization handles advertising in different ways. establish an office in Philadelphi a in 1841. Probably the first agency with a reputation fo r a creative work was Lord and Thomas with two remarkable copywriters. advertis ing is handled by someone who is in the sales or marketing department. The first advertising agent Volney B. A large c ompany will often set up its own department.

Once the client has agreed to work with the agency. events and sports marketing and packaging and point of sale. making them essential full service. An agency’s creative team consists of specialists in graphic design. which is also known as research. computers. accounts. direct contact with media or through third-part y seller). which generally becomes the responsibility of the agency’s creative team. what it costs marketers to place an ad). copywriting. including understanding customers and competitors. so they are able to apply their p articular expertise in those areas.. an advertising agency may assign an account manager to work full-time with only one client and. who looks for the best media match for a client and also negotiates the best de Types of Advertising Agencies Full service Agencies A full service agency is one that includes the four major staff function-account management. such as different a dvertising cost structures (i. For large accounts one task account managers routinely delegate involves generating ideas. designing concepts and creating the final advertisem ent. has its own unique methods for accepting advertisements. size of ad).. diffe rent requirements for accepting ad designs (e. though non-competing. and also are used to test creative ideas. such as direct marketing. These agencies hand le a variety of client from within that field. of which there are thousan ds.e. creative service. For very large clien ts. Industry Focused Agencies Numerous agencies concentrated on certain fields or industries such as agricultu re. Understand ing the nuances of different media is the role of a media planner. public relations. such as large consumer products companies.g. possibly. Specialized Agencies Many agencies do not follow the traditional full service approach. computer programming. a traffic department to handle internal track ing on completions of project. agriculture and business to business communication. youth) or industries (health care. These responsibilities include locating and negotiating to acquire clients. For instance. a department for broadcast and print production ( usually organized between creative departments) and a human resource department.a number of functions including: • Account Management – Within an advertising agency the account manager or account e xecutive is tasked with handling all major decisions related to a specific clien t. when ad will be run). and much more. In addition there are specialized agencies i n all marketing communications areas. A full service advertising agency will also h ave its own accounting department. producing art. in the early stages of an advertising campaign researchers may run focus group sessions with selected members of the client’s target market in order to get their reaction to several ad vertising concepts. media planning and buying and accounting planning . sales promotion. . film and audio production. • Researchers – Full-service advertising agencies employ market researchers who asse ss a client’s market situation. the account manager works c losely with the client to develop an advertising strategy. • Creative Team –The principle role of account managers is to manage the overall adv ertising campaign for a client. • Media Planners – Once an advertisement is created. it must be placed through an ap propriate advertising media. Each advertising media. different ways pl acements can be purchased (e. or media buying) aud iences (minority. health care and computers.. They either s pecialize in certain function (writing copy. which often includes delegating selective tasks to specialists..g. Researchers are also used following the completion of an ad vertising campaign to measure whether the campaign reached its objectives. For smaller accounts an account manager may simultaneously manage several different. with on ly one of the client’s product lines. and different time schedules (i. medicine and pharmaceuticals.e.

This agencies are organized in much the same way as full service agency . The focus on the organization is entirely on idea. This type of agency does not use conventional office space. Media-buying Service Media-buying Service specializes in the purchase of media for clients. Virtual Agencies Virtual agency is agency that operates as group of freelancers and is paid accor dingly. 9. media and agencies wi ll have their own internal research department. at each levels of advertiser. of choices grows-think of the proliferation of new cable channels. Contract Advertising (India)Ltd. 5. but it sometimes retai n by advertising agencies when they are overloaded with work. the cost of the maintainin g of competitions media department has escalated. A creative boutique will have one or more writer for artist in staff. 1. and each will also be purchasing data externally from some outside research supplier. R K Swamy/BBDO Advertising Pvt. An advertising agency is a firm that specializes in the creation.V. design. Second. media buying services o ffer by media at a low cost because they can group several client purchases to g ather to develop substantial buying power. typicall y this agencies can prepare advertising to run in print media out doors and on r adio and T. As the no. Ogilvy & Marther Pvt. They are in high demand for any reasons but three reasons stand out. Large companies. or strategy planning.Minority Agencies Agency that focuses on ethic group or minority agencies is minority agency. 7. The advertising agency is a representative between media and advertiser. (JWT) Mudra Communications FCB-Ulka Advertising Ltd. t he creative product. Rediffusion – DY&R Mccann Erickson (India) Ltd. Creative Boutiques Creative boutiques are advertising agency.Walter Thompson Association Ltd. and pl acement of advertisements. magazines and radio stations. First. Third.but they as specialize in reaching and communicating with their particular market. A major roll of the advertising agency is the purchase of media time and space. research. . 10. 4.Ltd. Ltd. 8. 2. ( O&M) J. and in the planning and execution of promotional camp aigns for products and services of their client The basic techniques that is adopted by different advertising agency are Basic appeals Attention getting headline Slogans Testimonials Product characteristic. 3. Grey World Wide Leo Burnett India Pvt. creative boutique usually serves companies. media has bec ome more complex. Comparison of product Repetition Some of the famous advertising agencies in India are as bellow. 6. There is no staff for media. Ltd. usually small (2 or 3 people to a doz en or more) that concentrate entirely on preparing the creative execution of cli ent marking communications.

The current size of the industry as a whole is estimated at US$ 7 billion in 2004 and is expected to grow at a CAGR of 14 per cent to US$ 13billion by 2009. though their share of the total media pie has expectedly shown a slight dip. The Filmed Entertainment and Television segment dominate the industry followed b y the Print. Standing tall at an estimated size of Rs. The main reasons for this are: Willingness of emerging advertisers to pay for impact Expansion of traditional media into new markets and formats. An add ed boost to the entertainment and media indus try in India is from the demographic point of view where the consumer spending i s rising due to increasing disposable incomes on account of sustained growth in income levels and reduction of personal income tax over the last decade. .3% CAGR during CY2007-11. Research Media selection Creative work Production Indian Media and Entertainment Industry The Indian Entertainment and Media Industry have out-performed the Indian econom y and is one of the fastest growing sectors in India. aged 25-45 years). It is rising on the back o f economic growth and rising income levels that India has been experiencing in t he past years. which is helping th em demand value A strong business environment that supports this growth Increase in advertisers’ s pends on traditional media to maintain status quo and their willingness to look at new media (which also tend to be cheaper options) to create differentiation a nd grab attention Shift in focus from conventional target consumers (Housewife. who are the primarily being targeted through new mediums like Mobile and Internet. 513bn in CY2007. have been met. and Radio and Niche Publications. Inner circle represents shares in 2004 and outer circle represents projected shares in 20 Indian Media and Entertainment Industry Size Over the last several years. which looked very ebullient at the time. New media have grown at high rates in line with their expected potential. However. Radio and the Music segments.While traditional segments like Tel evision and Print continue to account for the largest shares of the overall pie.That’s why for effective agency follows the below procedure and pays complete conc entration on it. it is expected to continue to grow at a steady pace of 18. and they have continued to show strong growth. tradit ional media have not been disadvantaged by this. What is even more heartening is that the estimates in the TYN Y 2007 report. Indian Media & Entertainment (M&E) Industry has con sistently out performed most other sectors in terms of growth. to include the Male and the Youth. The Indian Media market has been on an upswing in the last 5 years and 2007 has been no exception. This is significantly benefiting the entertainment and media indu stry in India as this is a cyclically sensitive industry and it grows faster whe n the economy is expanding.

it is emerging segments like Internet advertising, Radio and Animation and Gami ng, which are expected to register higher growth. In terms of size, we believe t hat the Indian M&E industry has just touched the tip of the iceberg. In CY2007, the Indian M&E Industry accounted for a mere 0.9% of the Global M&E Industry, wh ich stood at US $1,432bn and is expected to grow at a CAGR of 6.6% over CY2007-2 011. A buoyant economy and extremely favorable demographics are the two key macro-eco nomic constituents on which the Indian Media industry stands today. Media Indust ry generally tends to exhibit cyclical nature wherein it grows faster when the e conomy is buoyant and we believe the time is right for the Media industry to bas k in the glory of India Shining story. In perspective, according to a McKinsey r eport (MGI India Consumer Report), if India continues on its steady growth path over the next two decades, a major transformation will take place in the Indian consumer market. Income levels will triple and result in India taking over as the fifth largest c onsumer market (currently twelfth). Such strong growth and higher incomes will m ove over 291mnpeople out of desperate poverty and India s middle class will swel l by almost ten times from its current size of 50mn to 583mn people (41% of popu lation/ 128mn households) by 2025. Income growth will be the fastest in the urban areas where average real househol d incomes will increase by 5.8% whereas rural incomes will accelerate by 3.6% ov er the next two decades. Moreover, as higher disposable incomes propel consumer spending, more money will flow into leisure activities giving a steady impetus t o M&E Industry. Besides the macro-economic factors, we believe steady advertisin g growth, liberal government regulations and convergence of diverse platforms wi ll be the key growth drivers for the Media industry.

Indian Print Media Indian print media has evolved through a series of revolutionary events.This has rendered the market highly fragmented with approx. 1900 news publications for a circulation figure of just 200 million. The segment hence provides for several opportunities as listed below: • Tapping the reading population As per the latest readership survey NRS 2005, the reach of the print media (dail ies and magazines combined), as a proportion of the reading population (i.e. 15 years and above) is only 27 per cent. The global average readership is estimated to be over 50 per cent. This highlights the significant potential of the print media market in India. Further, as literacy (as measured in the NRS) grows by ne arly eight points and even higher in the rural areas, the potential of the print media assumes a significant proportion. This can be illustrated from the fact t

 

hat one of the reasons that Dainik Jagran, India’s leading daily hasbeen able to r etain its leadership position for the last three years isbecause the number of l iterates in Uttar Pradesh, Bihar and Jharkhand(strong Dainik Jagran markets) has grown explosively. Time spent on reading has also gone up quite significantly f rom an average of about 30 minutes daily to around 39 minutes daily over the las t three years, further contributing to this growth potential. • Build a pan-India presence Due to low levels of literacy and India’s marked regional diversity, the print med ia segment is characterized by a large number of players dominating specific geo graphies (See Table below). Vernacular news dailies thus dominate the market wit h a 49 per cent share. Regional dominance is not just typical of only vernacular papers- even English news dailies have managed to gain dominance only in specif ic pockets. As a result, there are hardly any players with a pan-India presence.

• Leveraging a fragmented market The print media market today is highly fragmented with most publishers being fam ily owned. These publishers hence had low access to capital and information and thus concentrated only in the geographical location in which they were the leade rs. However, this trend is now changing and publishers are looking to expand the ir market though both organic and inorganic routes. With an added push of foreig n investment being allowed in the print media segment, this segment thus offers significant investment opportunities More than 220 million readers of English and vernacular language newspapers and magazines & It is close to 10% of the total base Newspapers account for 90% of t he market, Magazines account for 10%market share. Revenues expected to grow from USD 2.38 bn in 2005 to USD 4.37 bn in 2010. Subscriptions contribute 57% of the total revenues, rest by Advertisement Print media. Print media players continue to add new properties and territories. Deccan Chronicle launched its much awaited flagship daily Deccan Chronicle in th e Bangalore market. DCHL also entered the financial daily segment with the launc h of Financial Chronicle in Hyderabad,Chennai, Bangalore and Mumbai. HT Media ex panded the presence of Hindustan in UP. However, the print segment is reeling under 30% increase in newsprint prices sin ce the past six months on account of Closure of two mills in North America (end-CY07) resulting in consolidation of c apacity, Shortage of waste newsprint for Chinese newsprint plants resulting in global pri ce increase of US$35per ton, High prices of crude oil and wood and increase in newsprint demand in USA due to presidential elections. Sharp depreciation in rupee in the past three months as against the earlier tre nd of appreciating rupee. Notwithstanding the threat from Television and emerging media like Internet and Radio, the Print Media in India continues to dominate the M&E space attracting t he highest revenues in terms of advertising. In CY2007, the Print Media segment in India stood at Rs149bnregistering a yoy growth of 16.5%. Newspaper publishing , which accounts for 87% of the segment, registered a 16.6% yoy growth whereas M agazine publishing, which contributes the balance, grew at a marginally lower ra te of 15%. Going ahead, Print Media is expected to deliver a 14% CAGR in overall

revenues during CY2007-11 driven largely by advertising revenues as circulation growth is expected to witness a slowdown. Print Media Industry Size

Print Media in India - Expanding Geographies

We attribute this unique feature to the following: Family owned businesses - Most Newspaper businesses in India are family owned an d have a strong regional focus. Moreover, due to lack of funds and localized nat ure of the newspaper business, most of them have remained content in their own b oundaries. Strong Entry barriers - Newspaper business has extremely strong entry barriers o wing to strong brand equity, readership loyalty and requirement for a wide distr ibution network. Moreover, as advertising revenue in a region is generally absor bed by the top-two players, in most cases it makes competition unviable. Niche focus - In general, Regional newspapers (Hindi + Vernacular) offer local a nd regional focus to their readers, often issuing several different regional edi tions. The content and circulation of English-language newspapers, on the other hand, is largely focused on the primary urban centers. Hence, both enjoy their o wn set of readers and advertisers, which have left enough room to expand within. Nonetheless, the scenario is fast changing. Post opening up of FDI in the sector , several players have attracted large investments and also tapped the IPO marke t to raise funds. Equipped with a large war-chest of money, these players have b roken from their regional strongholds expanding into newer geographies, launchin g new editions and even venturing beyond Print. We believe this trend will pick up further momentum in the future as Print companies taste the b enefits of ad-bundling (arising out of the ability to offer advertising in multi ple editions) and derive synergies from common infrastructure and brand equity. Key Concerns Rising Newsprint Prices The cost of production of a newspaper is directly linked to the cost of newsprin t, which varies with the market price of newsprint, availability and location of printing facilities and the number of pages used. Newsprint costs generally acc ount for almost 50-70% of total expenses for a publishing business. Below we hav e enumerated newsprint costs for our Print Media universe vis-à-vis their total ex penditure and revenue. Newsprint costs vis-a vis Expenditure & Revenue

Newsprint prices vary according to quality. Newsprint is a freely traded commodi ty on the international markets and exhibits price volatility. India imports alm ost 70% of its newsprint requirement. The English newspapers generally use highe r quality and mostly imported newsprint compared to the regional players which u se a mix of imported and domestic newsprint. In our Print Universe, the ratio of Imported: Domestic newsprint stands at 90:10 for Deccan Chronicle, 70:30 for HT Media and 35:65 for Jagran Prakashan.

Print scores over Television due to inherent advantages. we believe Newspaper publishing in India is set to grow owing to t he following inter-related structural growth drivers: Low Penetration One of the key factors influencing allocation of ad spends towards different me dia platforms is reach. corporate communications. indicating strong headroom to grow readership numbers. newsprint prices were on a steady rise for almost four years and peaked at US $640MT levels in July 2006. • Print ad costs are drastically low in India compared to the TV ad spots making p rint the affordable medium for a larger number of advertisers.9% to 71. ads relating to se ctors like education. Moreover. matrimonial and services of fered are reserved for Print (Internet is now posing a threat). Literacy levels in urban areas at 85. readership (d ailies and magazines combined) increased to 222mn from 216mn. as a medium. However. cinema listings. in % terms.1%. Even though. due to the sheer number of people falling in the lower brackets. Ability to communicate lengt hy.3% witnessed a 90bp rise whereas rural area s at 64. literacy levels in India have risen from69. Print. the print media penetration is higher among people in the upper socio-economic classes. it is witnessing faster growth in terms of reach compared to televi sion. Structural factors to Drive Print Media growth in India While advertising revenue growth is largely related to strong economic growth in the country. reach of Print media is lower than television. real estate. 2008). The reach of Print Media in India is significantly low a t 38% constrained by poor literacy and income levels. This has led to si gnificant scope for growth for newspaper publications in terms of untapped poten . has certain inherent advantages over other mediums particula rly TV. detailed and complex information. its reach in the urban areas at 58% is substantially higher compared to the rural areas at 30% (F ICCI-PwC Report on Media. are also better suit ed for print. • Certain categories like classifieds related to jobs. • Several advertisements are best conveyed only though the print medium including tenders. Moreover. Improving literacy levels According to NRS 2006. etc. which helps the segment retain higher portion of advertising revenues: • Newspaper advertisements have a better shelf life and visibility unlike TV where viewers flick through channels during commercials.After bottoming out in July 2002 at US $430MT. forms and descriptions is also unique to p rint. the num ber of print readers in the lower strata outnumbers the readers in the upper str ata on an absolute basis.8% witnessed a higher rise of 120bp during 2006. The ris e in newsprint prices during the period was attributed to steady demand and cost push inflation. Moreover. H owever. most Print Media companies reaped the benefi ts of lower newsprint costs on account of the dual benefit of declining newsprin t prices and rising Rupee. financial products. • Newspaper easily wins over TV in case of ease of targeting audience by demograph ic and/or region. Print also again scores over TV in case of reach of the local ads. In FY2008 however. compared with those in the lower brackets.

rising incomes and rising literacy levels to accelerate India’s print media ind ustry growth. In 2001-06 . 68 % can read Hindi indicates strong potential for readership growth. Convergence . growing efforts by Print Media companies to push up circulatio n in terms of discounted cover prices and incentives(subscription schemes) have not only accelerated penetration of dailies.8%. to grow at a CA GR of 14. Also. which indicates the potential for higher circulation as affordability im proves.5% growth for most o ther markets globally over 2001–06. In these markets.8%.8% CAGR. print advertising’s share stood at 47%.Playing its part in Print Media Sitting on huge cash piles and with the ability to generate strong cash flows. While newspapers in India are not gaining ad spend at the same rate as other med ia. India is one of the few markets in the world where newspaper reader ship is growing.8% CAGR over 2 006-011E. which can help publishers attract strong advertising re venues.8% to Rs282bn over FY06-11E. driven by rising income levels and increasing literacy. Print has 47% share of advertising pie Over the last decade. local print advertising is an effective means of communication. especially TV and Internet. We expect newspapers to be a key beneficiary of . how ever. the nee d to capture a larger advertising pie and ability to derive cross-synergies are some of the key reasons necessitating this transformation.8% CAGR in circulat ion revenue. increasing penetration of cable and satellite TV has shift ed market share from newspaper advertising towards broadcasting. In 2006. estimated at Rs144bn. the Indian print industry grew at an 8. based on a 16. This trend. seems to have stabilized over the last few years. Moreover. each re gional daily is read by almost 7-9 readers compared to 2-3 readers for English d ailies. newspapers still capture a significant share of overall advertising. against 1–3. which has We expect the Indian print media industry. but have also helped push multiple dailies into homes. India is one of the fastest growing print media markets in the world. Going forward. telecoms. increasing literacy.8% CAGR in advertising revenue and 8. The fact that out of the 359mn people in India who can read but do not currently read any publication. In addi tion. real estate. We believe the Print Media companies in India have just embarked on a global trend. Improving affordability Rising income levels coupled with aggressive marketing by print media companies is also driving growth of Print Media in India. whereas we anticipate circulation revenue growth of 8. A booming economy. rising incomes and low media pe netration are some of the factors driving the growth in India print media. Strong growth in sectors such as retail. 20mn of these literate non-readers belong to the upscale SEC A and B segments (higher s ocio-economic brackets). w hich provides for opportunity of growth in readership. we expect strong economic growt h.tial readers. We estimate the print media segment will grow at 14. Rising competition. Advertising revenue should clearly lead th e growth with a CAGR of 16. and financial services has led companies to target penetration in Tier II Tier III cities. which still makes it largest revenue generating advertising medium and higher than the globa l average of 42-45%. there is a literate population of about 300m who do not read newspapers. with positive implications for print sector growth. It should be noted that. P rint Media companies have started to realize the importance of convergence of me dia platforms and moving beyond their core business.

Both the English and the “language press” (nonEnglish) tend to support the Indian government on foreign policy issues. Television is assuming tremendous importance in the country. The Urdu press is the third lar gest. . Malayalam. Private cable and satellite t elevision reach the entire country. which would provide a regulator y framework for the industry. The past20 years have seen a remarkable growth. officially or ideologically. Other major language newspapers with a circulation of at least 100. and some subscribers have access to as many as 50channels. All India Radio has a countrywide network of reg ional broadcasting and programming center as well as a national channel that bro adcasts in Hindi. The Indian press is. was awaiting action.n I ndia’s language press is booming. a draft broadcasting bill.Newspaper and Magazine Advertising in India. with circulation trends pointing up. are feistier and more apt to criticize the government on do mestic issues than their electronic counter parts. Gujarati.0 00 newspapers and magazines published in English and dozens of other languages. especially the Eng lish language press. English publications have a 17% share. especially among th e growing middle class. the Prasar Bharati Act was en acted. In 1997. for the most part. Owners can and do dictate editorial policy. Newspaper readership is steady. Bengali. Radio is the most popular means of information and entertainment. By early 1999. particularly for the r ural and illiterate population.000 are in Tamil. Viewer ship is estimated at nearly 300 million. Kannadaand Punjabi. independent and privately owned. despite the rapid growth of electronic media. Marathi. Ne wspapers remain relatively in expensive. A few n ewspapers are linked. giving BBC-style autonomy to the formerly state-controlled TV and radio networks. Telegu. Urdu and English. Doordarshan and All India Radio. n India boasts more than 43. to political parties. Hindi publications have a 36% share of the total circulation of newspapers and m agazines. and the print media. two dozen satellites beam signals to India.

it wou ld take some time before this avenue begins to generate real value. • Rise of the Tabloid: Even though broadsheet still remains the popular format. publica tions are increasingly targeting retailers and cashing in on their diverted OOH spends. de spite being the biggest incumbent medium. TOI has made the half front-page gate fold a regular feature and most o ther publications have followed suit. The Players: Within each language there are one or two players that have seen over 25% growth and others which are closer to 10% levels. It has become a very attractive option for advertisers as well. Typically the big players have got b igger. th ere is an increasing accent towards smaller formats. This is a growth of 18% over calendar 2006 ( Rs. Here increased colour options helped publicatio ns improve their yield from advertisers. Print. Expensive English print became even more expensive wit h leading brands making forays into new markets or improving relative readership contribution from smaller markets. The India Print story is in stark contrast to the threat being faced by the medi um globally. Factors such as increasing cost of newsprint and shift in reader preference (young readers who find newspapers d ull have shown interest in this format).7. continued to attract the largest share of advertising spends. which gives them over 75% of the total hits. While this has been made possible due to the continued dominance of publications in their home mark ets. Publications which promoted their Classifieds portals as separate entities have succeeded in penetrating segments like Matrimonials. . might only accelerate this trend.The Market: The Display advertising component of the Newspaper market in India for calendar year 2007 was valued atRs. The newly launched Mail Tod ay (JV between Associated Newspapers Ltd with Living Media India Ltd) and Metro Now (JV between HT Media and BCCL) have indicated that there might be a subtle s hift towards ‘Tabloidisation’ of the Indian market. On the other hand the local retail market continued to strengthen its media inve stment in regional publications.60% of total volume consumption in 2007 was in colour as against 52%the year before. Real Estate and Jobs.) as against the 17% predicted by us in last years report. Publications are also actively look ing at ways to tap into the local advertising market with “Go Local” drives by way o f new Supplements. The major reason for the revenue growth has been the consistent hik e in Card Rates of major players.290 cr. Leading publications are also creating new avenues for growth through forays int o other languages and formats.9. The Product: • Death of the Front Page as we know it: Product innovation is the name of the gam e today. Rate hikes have taken place at both the premium and the popular ends of the product spectrum. in spite of increased competition in the top 8 Metros and stagnant Average Issue Readership (AIR) numbers.856 cr. With restrictions on OOH medium usage in some cities. However. Publications are using e-paper versions by target ing NRI population. others have done so on the back of Rate Hikes and improved C olour to B/W ratios. While some players have grown on the back of increased offerings and entr y into new markets. rate hikes in some part have also been imposed to offset their entry into n ew markets.

In terms of advertising revenue growt h. Private Equity players and bankers will also continue to explore investment oppo rtunities in Indian media houses. For instance. a thriving business in India. forcing publ ishers to look at new formats and revenue streams. The Future: 2008 will continue to be an exciting year for print. While 2 years back everything appeare d plain vanilla. Going ahead. While existing print players will diversify in related genres and enter new geographies. non-pr int players will enter print to diversify. Rising literacy levels and limited access to Internet will be the key reasons why print will continue to g row. The Reader: The Indian reader has never had it better. This will put pressure on margins. Delhi s underground. generated Rs130bn in revenues during CY2007out of which 61% came from adv ertising and the balance from circulation.Standing tall in India Contrary to popular belief and in defiance to global trends. We do not expect the digita l wave to dampen our attachment to the morning daily. Business Standard was not far behind with its launch of Hin di editions for Delhi and Mumbai. technology. the ind ustry is expected to register a 13. • The launch of supplements designed for special interest areas such as lifestyle. entertainment.Newspaper publishing. with Metro Now being the pioneer. this year will see a host of new launches. daily. Econo mic Times broke the trend by launching a Gujarati edition in Ahmedabad and a Hin di edition in Delhi.2% yoygrowthduringC Y2007 as against 20. will have 100 stations in three years time and is expected to carry 3 mi llion commuters. Just as in 2007. Newspaper publishin g still stands tall in India accounting for similar share of advertising pie as the popular idiot box (television). it once again outpaced television registering a robust 21. he or she has a choice of multiple flavors and publishin g houses are more than willing to cater to his or her tastes.• Move to other Languages: 2007 witnessed the transition in areas such as Business papers which have always been considered the domain of the English press. Growth in transport infrastructure will result in the launch of commuter newspap ers across cities. today.8% growth in advertising on television. Newspaper publishing . Newsprint prices are on the rise and the next few quarters will continue to see increasing prices and shortages. education and careers.9% CAGR in overall revenues during CY2007-11     . This is the TG most co veted by advertisers and media houses are already launching publications to tap in to this bunch. which did not exist before 2002. mostly in the age group of 15-45.

circulation revenues are a function of the number of copies sold and pricing of the publication. Newspaper Publisher Business Model Print Media in India – Readership Even in terms of overall readership. The Print Media model involves dual stream of revenues . Newspaper Publishing Industry size Revenue Model skewed towards advertising. While advertising revenues are generated from sale of advertising space in a publication. the Regio nal dailies commands a lower share of the print advertising pie. This is primarily due to higher cover prices of Regional newspapers compared wi th English newspapers and the readers of Regional newspapers are generally from the lower socio-economic segment Top Ten Newspapers by Readership However. the Regional dailies (Hindi and vernacular dailies) dominate the pie with The Times of India being the only English daily t o feature in the Top-10 list. . This nature of dual stream of revenues requires newspaper publishing companies to create a balance between both streams to achi eve maximum potential and sustainability. English dailies (including Business dailies) attract the highest advertising revenues with appr oximately 50% of ad-spend followed by Hindi and other Indian language newspapers with approximately 25% of ad-spend each.advertising and circula tion. Moreover. despite having higher number of registered newspapers.largely driven by advertising revenue growth. higher readershi p and a better proportionately distributed readership (urban + rural). the Regional dailies have a readership: circulation multiple of 7-9 times compared with English newspapers of 2-3 times. A typical newspaper publishing model h as the following structure.

due to that more people are reading the news paper.Industry life cycle The life cycle of the print media is shown below it shows that the industry in t he growth stage its earnings are increasing year by year from the year 1995 its earnings were 24500 mn and in year 2007 it has increased to 118064 it shows the constant growth in the industry and the reasons behind the growth of industry ar e that the literacy level increase. And as the industry is in growing stage and chance of earning are high more play ers are attracted towards the investment in the industry compounded annual growt h rate of the industry is 14% and it shows the profitability of the business tha t is there are more chance of earning good profit in the industry which can be s een from the figure shown below. even the government support the industry. in 2005 budget the government t he service tax over the space for advertisement in television but it was untouched for print media and due to that there was a s udden boost in the income for print media from year 2005 to 2007. PEST ANALYSIS .

Any print media company wishing to change its share-holding pattern must get a a prior government approval. Consequently.2007 (i) Sale of space or time for advertisement. Service tax on development and supply of content for use in advertising purpose (advertising cost increases). • a • • The pre-conditions of FDI in print. At least three-fourth of the board of a print media company with FDI must be a Indians. yellow pages and trade catalogues which are primarily meant for commercial purposes. excluding that in print media and that by broadcasting agency. brought u nder the service tax net.06. The scope of this service has been expanded by substituting the explanation 2 to the clau se (zzzm) which defines print media. other than in print media is chargeable to service tax under sub-clause (zzzm) of clause (105) of section 65. Service tax increased from 10% to 12%. Sales of space for advertisement in print media left out of the ambit of service tax. Scope of certain existing services expanded [Section 65] All the changes in respective services specified below have come into effect fro m 01. 3. (Source: Equity master union budget – 2006-07) .• Political Factor: 1. All key editorial posts must also lie with resident Indians. other than in print media Sale of space or time for advertisement. Sale of space or time for advertisement s ervice. (Source: Amendments by the finance act 2007) 2. sale of space for adv ertisement in such publications will also be livable to service tax under this s ervice. The new explanation states that print media does not include business directories.

and Sanjiv Kanwar and Dipak Mukherjee. A. however. First. the offence chiefly concerning the press. which began more than a decade ago. And in the company ¾ of the board mem ber should be Indian only and should be having control in their hands. Foreign investments in news agencies.D. Lucknow and Delhi. Ghanshyam Pankaj. editor of the Hindi daily Swatantra Bharat . t aken by the Union Cabinet. reverses the 1955 Cabinet resolution prohibiting any foreign investment in print media. the matter is deeme d to sub-judicial and cannot be commented upon. in other words. (Source: ibef julysep 2008) 5. printer\publisher of The Pioneer and Sw atantra Bharat. Thus. with a view to causing harassment and cowin g newspapers and other members of the media deemed to be ‘unfriendly’. TV or radio channel if the complainant is able to satisfy a magistrate that a statement made about him /her was on the face of it defamatory. holding the reporter and the other accused gu ilty. is defined as any publication that interferes wit h or undermines the administration of justice or has a tendency to do so. A. at the state’s e xpense and without the person claiming to be defamed having to appear in court. IPC (Indian Penal Code): The Indian Penal Code makes criminal defamation a noncognisable offence. Foreign Investment in Print Media Only 26% FDI is allowed: the government allow 26% F. This enactment has been used by the chief ministers of some states to launch vex atious litigation against the press.D.K. 2007. Chief Judicial Magistrate Suresh Chandra pronounced his judgment on September 3.K. remain ba rred. While there a re no apparent restrictions on the free coverage of groups or issues. In 199 7. marketing. Second. namely opening up a very sensitive sect or. c riminal proceedings can be initiated against a newspaper.4. The print media Government of India in June 2002 had decided to allow 26% fo reign direct investment (FDI) in news and current affairs print media. A detailed policy statement on FDI in print w ould be issued shortly. The Opportunity The desire for foreign help is palpable. Technical and medical publications have been allowed a higher FDI of 74%. but annu al revenues total just $1. After a 10-year-long trial. and capital to expand.1 billion. and breach of legislatures’ and Parliament’s privileges. Two significant aspects of the defamation law impact on th e press. most a re starved for technology.I is allo wed due that foreign players are restricted. once a case of defamation is taken to trial. respectively. Bhattacharya. The decision. The government has attempted to address the concerns of political parties that fear FDI in print might lead to foreigners controlling the Indian media. the then editor of The Pioneer.I is allowed in non news segment which include s magazines like scientific magazines but in news segment only 26% F. there are some restrictive enactments in place to deal with contempt of the judiciary. has taken another significant step. Singh filed a criminal case under Sections 500 and 501 of the Indian Pen al Code against Raman Kirpal. While they can be vibrant and gutsy. India has 49.D.I limit for the investmen t in print media in that 100% F. where the person claimin g to be defamed is the Prime Minister or the chief minister of a state. Budget 20 02-2003 The process of economic liberalization in India. He also said that the a .000 publications. The Judge said in his order that it had been established that the intervie w published by the accused was concocted and defamatory. Criminal contempt. Civil suits for defamation are also possi ble under Indian law. the pros ecution can be launched by the public prosecutor.

2004 This Act may be called the Prohibition of Publication or Telecast of Vulgar." FICCI said. there is five per cent.) 8. Currently on import of newsprint. are adept at gauging the popular mood about political parties and see no difficulty in swearing or switching alle giance to those in power. (Source: Adverting and promotion management by Beltch & Beltch. (Source: www.000 crore to the country s exchequer.ccused persons had failed to prove that the reporter had actually taken the inte rview.htm) 9. Cu rrently. private monopolies and cartels of the media do exist . large quantities of the same are being dumped from Sou th-East Asian countries.com/bareact/Indian penal code.com. The total requirement of newsprint in the country today is around 10 lakh tonnes .com/article/print. In the absence o f restrictions on cross-media ownership. obs cene and Surrogate Advertisements and Re-mix Songs by Print and Electronic Media Act.bd/2007/07/01/budget-has-measures-to-contain-pri ce-hike-scopes-for-job-creation/ . 2004. (Source: vakilno1. "Due to negligible dut y on import of newsprint. wast e paper whereon the duty incidence is 9. State authorities have in the recent past not taken any action against private media monopolies.40k. WTO bound rate for newsprint is 25 per cent. Such monopolies and cartels are found largely in the press.bangladeshnews. Page no. Custom duty on import of newsprint. The domestic production of newsprint by the existing manufacturers can fully m eet the country s demand. Russia and America and the indigenous industry is suffe ring badly.asp) 7. Thus. but some media bar ons have overlapping interests in television and FM radio.. Media monopolists are generally proestablishment and support the governments of the day to ensure tha t their monopoly positions are not threatened. This is largely because such monopolists support ruling dispensations.e. The above duty is even less than the duty on raw material i. Act for surrogate advertisement. b) Import of newsprint is allowed to actual users. Coping with Regulations: Marketers can cope with advertising regulation in various ways: • Monitor regulations and pending legislation: Monitoring legislation and gatherin g intelligence on possible changes in advertising regulations is crucial since a     . approximately five lakh tonnes of newsprint are being imported at the c ost of around Rs 1. The present newsprint policy of the Government of India is as follows: a) Not less than one-third of the annual production of indigenous newsprint will be reserved for small and medium newspapers. But duty was bound to be reduced because of the increase in the price of news pr int globally and due to that government reduce the duty from 5 percent to 3 perc ent and due to that import can be done at easy rate But import on newsprint for newspaper is exempted from the import duty.2 per cent (basic duty five per cent plu s SAD four per cent). (Source: legalserviceindia. such monopolies in fact straddle variou s units of the media. These monopolies exist mainly to enrich the owner of the media company.asp) 6. as the installed capacity is around 12 lakh tonnes. MRTP act on news: While general legislation exists to regulate monopolies and cartels – the Monopoli es and Restrictive Trade Practices Act – this has been ineffectual in curbing the formation of monopolies and cartels of private media companies.

It ran a sales promotion campaign at a horse race where losin g bettors got a free Hamlet cigar. A widely popular mechanism to cope with tobacco ad ban s is brand extension or surrogate advertising. to cope with a complete tobacco ad ban in Sweden. 3.7 HT Media Public (IPO) 3. Hamlet. especially when the issue s at hand are highly controversial. advertisers and sign painters filed suits in civil court when the government asked advertisers to place outdoor boar ds several blocks from the road. For instance. In t he United Kingdom. the Swedish Tobacco Co. mainly due to lack of funds. chapter no. “Advertising Industry facts and regulation”. In the European Union. 67) • Economical: Attracting foreign investment Most Indian print players continued to dominate the local regions and did not en ter new territories. Hamlet started using outdoor boards for the first time.258 sites. shifted to other media vehic les following the ban on all TV tobacco advertising in the United Kingdom in oct omber1992. whose brands have captured more than 80% of the Swedish cigarette market st arted promoting sunglasses and cigarette lighters under the blend name. outdoor board companies. 100% foreign investment is permitted. Domestic Company Investor Amount Invested (Rs.dvertising regulations change from time to time. Currently. • Legal remedies: Advertisers may also consider fighting advertising legislation i n court. the leading cigar brand. Since the changes in the regulation many foreign investors have taken strategic stakes in the domestic print media companies. advertising agencies and the media. • Modify marketing-mix: Tobacco marketers have been extremely creative in handling advertising regulations. the prevaili ng mood is in favor of liberalization with the important exception of tobacco an d alcohol advertising.7 . it also started selling a video cassette with about 20 of its celebrated commercials. In South Korea. In many countries. advertisers appealed to European commission or the European court of justice to overturn local laws. In non-news publications. But too much lobbying carries the risk of generating bad publicity. foreign investment re gulations were relaxed in 2002. (Source: Anil Varma. installing th em at 2. In Chile. bn) Jagran Prakashan Independent News& Media 1. its best -selling cigarette brand. pag e no. up to 26% foreign direct investment ( FDI) is permitted in newspapers and periodicals dealing with news and current af fairs. Virginia slims pitched itself as a man’s cigarette because the Korean law banned advertising that targete d women and young adults. • Lobbying: Local governments or international legislative bodies can be lobbied u sually jointly by advertisers. However.

Effect of GDP growth: (Source: cii presentation july 2008) In 2006 GDP increased by 1.05% increased compare to year 2007. Contribution in GDP: Another favorable thing is that the contribution in GDP of print media is increa sing at increasing rate. in year 2007 it increased by 0. Story remains same in year 2007 al so. (as per NRS) Effect of inflation: Inflation rate has positive relation with the growth of print media advertising because when inflation rate increases the purchase of an individual also get inc reases and that lead corporate to advertise more. While in year 2006. (Source: Economic times (gujarati) page no. inflation rate increased t o 5.40 to 8. In 2005 GDP decreas ed by 1% and growth of print media also decreased by 0. Slowdown in the economy: Historically.3% a nd in year 2007 GDP increased by 0.9% and growth of print media also increased by 7. circulation revenues .4% o f year 2004.2% and growth rate of print media also decrea sed by 1.04% to 0. while the economy grew at an average 6%.29%. (Source: cii presentation july 2008) As in given chart when inflation rate decreases to 4.2 Ushodaya Enterprises Blackstone Source: Ficci PWC.29%. On the other hand when infl ation rate decreases purchase of an individual also get decreases and at that ti me generally corporate do not prefer to increase the frequency of the advertisem ent. As the entire picture reveals the situation that whatever change in GDP incur same happened to the growth of print media.9 0 which shows the decline rate.29% of year 2004.81% from 14.39%. as the given graph reveals that in 2004 GDP was 8.8% from 4. companies Global crises: 3. in year 2006 the contribution as 0. 2 date: 4th nov. the advertising industry grew at a CA GR of 11%.9% in ye ar 2005 from 15. Between 1996 and 2006. As per 11th five year plan the GDP growth was forecasted round about 8.33% and the estimated contribution in year 2008 is 0.6%.5 1 12 Due to global crises in the whole world the corporate has control their expendit ures and due that they had restricted the their advertising expenses which direc tly affect the earning of different medias and this also affect the print media earnings because advertising income contributes 75% of their total earnings and due to these reduction their earnings are negatively affected.5% and growth rate of print media was 15.38 % which is 0.5% in year 2005 from 7. so as per Angel broking survey 2008 the estimate d growth of print media will also be decreased.Jagran Prakashan Public (IPO) Deccan Chronicle Public (IPO) HT Media Henderson Henderson Dainik Bhaskar Warburg Pincus 1.5 Amar Ujala DE Shaw 1. this increased advertise ment of corporate lead the print media to grow more.9% of year 2005. the advertising industry has had a strong correlation with the gro wth in the economy.5% of year 2005 and the growth rate also show the same picture. 08) GDP v/s Growth of Print Media: GDP has no relation with Print media’s growth. the growth of print media advertising also decreased to 14. Thus. While. it increased to 22.3 1.

Wh ile rural literacy is at 64. which is very sensitive to the overall trends in the economy. ad spend is influenced by a nu mber of factors including the Indian economy. with increasing competition and venture into newer regions the compa nies have reduced the cover prices to augment more sales. the disposable income of people is increasing year by year.8%. Increasing literacy level 2. Low cost of production (small players can easily survive): Less technological changes in every business make small players to grow faster o r help to survive up to some extend.1% as compared to 69. reasons for that are. due to strong hold over a region. 61% of their revenues come from advertising. However. Higher literacy levels: In 2006. shifts in consumer spending patterns and changes in consumer senti ments and tastes.3%. 2007) Increasing disposable income: In India. Same is the situation in print media indust ry where the technological changes are very nominal and that give a chance to sm all player to survive. The numbers of readers are incr easing in rural area. which varies with the market price of newsprint. Increasing awareness level of stock market 3. the literacy levels increased to 71. Regional newspaper are also providing news of Business. the reach of newspapers is only 27%. (source: equity master marc h 26. The initial subscription offers of ‘DNA’ and ‘Hind . (Source: equity master November 30. Newsprint prices vary according to quality. the performance of particular indu stry sectors. Further. Even the 6th pay commissio n also increases the purchasing power of individual. Below we hav e enumerated newsprint costs for our Print Media universe vis-à-vis their total ex penditure and revenue. Classified etc. Also. urban literacy touched 85. in 2QFY08.for newspaper companies are recession-resistant. purchase p ower also get increased. 2008) Increase in price of newsprint: The cost of production of a newspaper is directly linked to the cost of newsprin t. the print companies faced pressure on the ad revenues as a slowdown was witnessed in the retail and real estate sectors.g. Newsprint is a freely traded commodity on the international markets and exhibits price volati lity. Many English dailies a re sold for as low as Re 1 or Rs 2. and has immense growth poten tial since close to 370 m literate Indians are believed to not be served by any publication. For e. availability and location of printing facilities and the number of pages used. People are spending more money day by day that lead adv ertiser to increase their frequency of advertisement. the newspaper had higher cover charge s. (Source: angel survey april-2008) Geographical expansion: The national players are penetrating regionally because the regional and especia lly rural market is also showing more potential. as compared to the globa l average of 50%. Any slowdown in the Indian economy and the consequent impact on disposable income co uld adversely affect advertising income. Lower cover prices: Earlier. Currently Indian p rint media is estimated to reach over 220 m people.9% in 2005. Newsprint costs generally acc ount for almost 50-70% of total expenses for a publishing business. The changes in industry are only in Production capacity a nd the cost related to production like increase in paper cost which is nominal i n nature. 1.

In 2006. Misleading. 1. the growt h in ad segment is expected to be strong. If this kind of advertising continues. It is a commitment to honest advertising and to fair competition in the market-place.1 36 17 2.5 bn advertising spend in the c ountry. the ad spend in India is just 0.ustan Times’ (HT) in Mumbai. As per the registrar of newspapers. further reduced the cost of the newspaper to around 50 paise for an average issue.6 4.7 25 16 14 5. The Advertising Standards Council of India (ASCI) (1985) has adopted a Code for Self-Regulation in Advertising.6 0. there were approximately 6. it won’t be long before statutory regulations and proced ures are imposed which make even fair. truthful.6 34 Urban (m) 42 40 15 16 14 Rural % 84 77 27 6.0%. It could lead to market-place disaster or even litigation.9 m copies per day . Higher ad spends: Print media accounts for 48% of the total Rs 137.3% in the US and a world average of nearly 1.3 (Source: NRS 2006) • Sociological factors: ASCI NORMS: WHY SELF-REGULATION IN ADVERTISING In recent years the quantity of false. However. misleading and offensive advertising has resulted in consumers having an increasing disbelief in advertising. Base Population (m) % Any Publication 184 Any Daily 170 Any Hindi Daily 63 Any English Daily Any Magazine 59 Urban & Rural (m) % 24 100 22 94 8. This certainly will affect your ability to compete and grow. second only to China with 98.529 daily newspap ers as of March 2005.4% of GDP as against 0. and a growi ng resentment of it. false advertising also constitutes unfair compe tition. It stands for the protection of the legiti . With rising consumerism and growing interest from domestic and global brands in Indian market. No single newspaper had a national circulation. decent advertising cumbersome i f not impossible. I ndia had the second largest circulation of newspapers with 88.5% in Ch ina.2 7.1 1. during their launch period.7 m copies a day.

you can mould the course of Self-Regul ation and participate in the protection of healthy. Bad effect on children: Parents have a different opinion according to them the excessive information and products thrown at them via the media. Religious barriers: Many of the trickiest promotional issues occur in the area of religion. in the further development of the Code and future appointments to the Consumer Complaints Council (CCC). Given the bewildering variety of language. 8-10 April. there is only ONE BODY for Self-Regu lation in Advertising – the ASCI. there are three different types of translation errors: simple carelessness. through the Board of Governors.mate interests of consumers and all concerned with advertising . the Brazilian soccer star. P&G overcame that constrain t by creating a spot for pert plus shampoo that showed the face of a veiled woma n and the hair of another woman from the back. only veiled women can be shown in TV commercials. Pirelli. Membersh ip of the ASCI (open only to Firms) entitles you to appoint your nominee to disc harge your function as a member. me dia. Why not have a say in matters affecting your own destiny? Why not make Self-Regulation truly work for you? In India. advertising agencies and others who help in the creation or placement of ad vertisements. Fewer unfair advertisements 3. ran into problems when it used an ad with a Christ-like depiction of Ronaldo. including standing for election to the Board of Governors and voting at general meetings. In Saudi Arabia. You c an have a say. the Italian t ire maker. Most marketers were targeting kids even for products that had nothing to do with children. effective advertising. three things will begin to happen. misleading claims 2. print and visual. As a member of ASCI. In Brazil. words with multiple meanings and idioms. spoiled the children. advertising copy translation mistakes are easily made. 1. standing in place of the “Christ the Rede . only means more freedom for you to practise your craft or carry on your b usiness effectively. Such res trictions create problems for hair care advertisers. which is concerned with safeguarding the interes ts of consumers whilst monitoring/guiding the commercial communications of Pract itioners in Advertising on behalf of advertisers. IIM K 71 Language barriers: Language is one of the most alarming barriers in international advertising. Fewer false. Increasing respectability Which. As the Code becomes increasingly accepted and observed pro-activel y. Since most middle class families have both parents working the market er tries to work through the children on the guilt of the parents and thus encou rage children to make very unreasonable demands. Nume rous promotional efforts have misfired because of language-related issues. as in several advanced economies. for example. 2007.advertisers. The ad showed Ronaldo with his arms spread a nd a tire tread on the sole of his foot. International Marketing Conference on Marketing & Society. for advertisements carried by the Media. In general. in their endeavours to influence buying decisions of the Consuming Pu blic.

Source: Global CEO. distr ibutors or ad agency people. the Arab countries. The Hofstede cultural grid is useful in understandi ng the influence of culture on global advertising. the advertisements of Mountain Dew of PepsiCo and Sprite of Co ca-Cola. The ad drew heavy criticism from the Brazilian church authorities an d the Vatican. for example. The problem here is that there is no adult who is shown s upervising the child near the swimming pool. Ads that position products or services as status symbols may be effective in countries with large power distance (e. The Children’s Advertising Review Uni t (CARU) of the batter business bureau (BBB) keeps a close eye on kid’s advertisin gs and advocates that adults be shown supervising children if the product and se rvice are supposed to be risky. because of the wrong perceptions in the minds of the consumers. but with the c ontext in which they are used. the problem is not in using children in advertising. the name of the competitor is not directly mentioned. All right reserved. Indo nesia.20. Let us take the example of baby shampoo (name of the company withheld). it appears when owner of brand X claims that his product is better than brand Y of the competit ors. use of ambiguous phrases. 000 cr. etc. and long termism. This figure is enticing the marketers to target the children with specific advertising. which has always been there in the advertising world. . Mexico). individua lism. Deceptive Advertising: Sometimes. publicizing fals e benefits. It can take quite a number of forms like making a claim which it cannot fulfill. Comparative Advertising: In the mad rush to outweigh the competitor. According to experts. kids between the age grou p of 8 and 12 in India spend a whopping sum of around Rs. Power distance refers to the degree of inequality that is seen as acceptable wit hin the country. july 2005. But the question remains whether it is advisable or not? Another question that comes to mind is “how effective comparative advertising is?” Ads to Kids: As per a study conducted by Business Today. masculinity.g. after protests from local bishops. for example. In France. One of the major areas of concern for the regulatory authorities is whether ad vertisers can substantiate the claims which they are making. advertisers give untrue and misleading information. By this. This has been extensively criticized by various researchers.emer” statue. without specific facts) to achieve their goals . Culture barriers: Advertisers must escape cultural traps by getting inputs from local staff. ever year. Advertisers often take the help of puffery (praising the i tem to be sold with vague claims. uncertainty avoidance. More and more companies ar e resorting to “masked” comparative advertising.. starting fr om the clothes to food and recreation. The grid classifies national cultures on various dimensions: power distance. advertisers are using comparative ad vertising. They are targeted through TV and print media. the icfai university press. Volkswagen withdrew a billboard campaign involving an ad the relaunch of Golf with a modern version of the Last supper. and is also another cause for con cern to the advertisers. the advertisement of fa irness cream for men.

an advertisement for condoms shows a couple in their wedding attire. Similarly. Condom Ads: There is a heated argument going on about the use of advertising to promote cond oms. but one has to keep in mind the Indian values and ethics when advertising any product r elated to this category. The coverage of contentious issues and the ones wh ich would not have got into public domain started making head lines in 2007. McDow ell’s No. Some people might call this hypocrisy. the advertisements of alcohol brand are restricted in many from media. RTI Act: The landmark Right to Information Act of 2005 with several implications to news media and good governance would have remained dormant had newspapers not given t he coverage in 2006 and 2007. especially the young. bu t the biggest market for condoms lies outside this context. Volume I. “W omen’s bodies are objectified in common ways. This is another aspe ct to be looked into. the objection comes through stereotyping.e.Tobacco and Alcohol Commercials: Advertising related to tobacco (in any from) is under the scanner of the governm ent of many nations including India. Tobacco companies have a tough challenge ahead of them i n using advertising to target potential customers. mostly. the cover p age of a fashion magazine features photographs which are not conducive to Indian culture. The ‘X’ Factor: A debate had been initiated a few years ago regarding the portrayal of women in advertising. population . In the process the news media got a new opportunity to reinstate their cre dibility and unleash an era of transparency in public affairs of the country. For example. Certain sections of the society feel prickly when these advertisements are shown in front of their children.” Women are used extensively by different ad vertisers to promote their products. No. On close examination of the ads featuring women. Most of the time. In the case of many popular ads. 7 September. It has an adverse effect on the. i.1 is advertised through the product “mineral water” this known as surrogate a dvertising.. According to Scott A Lukas (teacher at Lake Tahoe Community College). mo0dels having perfect bodies are preferred. New spapers started taking RTI route as a source for news and for “investigative journ alism”. For example. but the advertisers are sma rt enough to use the name of their brands for other products. 2008 Transparency Review . the focus is mostly on the nuptial bed. it is observed tha t.

Cyan. . Black Which are major color. Meganta. Ink: Pilofranic nature Paper: Green shade paper Machines There are Three types of machine which used in producing or printing newspaper o r magazine. They are as below: City line machine: German machine which has capacity to print 20 copy in one pri nt Way Mack machine: Swiss machine which has capacity to print 24 copy in one print 45 GSM machine: An Indian machine which is capable to print 24 copy in one print Indian and swits machine can print 35000 copy per hour.• Technological factors: 30000 color copy in an hour is available with new machines: Scanners : Colors: Yellow.

Five Force Analysis • Rivalary: Major Newspaper daily in industry ranked on readership: English Newspaper Daily No ALL publication 08 R 1 1 Times of India 6789 2 Hindustan Times 3277 3 The Hindu 2243 4 Deccan Chronicle 5 The Telegraph 1008 6 Mumbai Mirror 775 7 The Economic Times 8 DNA 676 710 9 Mid Day 571 535 10 The Tribune 429 (Source: Impact November 2008) No 1 08 R 2 change 6712 -77 3523 246 2121 -122 1225 1151 1019 11 895 120 743 752 34 5 -36 -6 466 37 % change -1 8 -5 -74 -6 1 15 9 1 9 English Magazines ALL publication 08 R 1 08 R 2 change % change india today 2402 2141 -261 -11 .

Bihar. Also. Equitymaster Political lobbing: Times of India made the political lobbing with ministers in the government for m aking the fdi restriction with other players and put pressure on the government to restrict the entry of FDI in India.2 reader digest 1594 1355 -239 -15 3 general knowledge today 1350 1225 -125 -9 4 competitio success review 899 794 -105 -12 5 Outlook 665 573 -92 -14 6 Wisdom 598 477 -121 -20 7 Stardust 553 438 -115 -21 8 diomand cricket today 469 400 -69 -15 9 the week 446 336 -110 -25 10 business today 416 326 -90 -22 (Source: Impact November 2008) Competition is very high The regionalism aspect is clearly visible in the newspaper sector. Newspaper Place of strong hold Jagran Prakashan Uttar Pradesh and Uttaranchal Times of India Mumbai HT Media Delhi. on the other hand.g. respectively. Tie up with foreign players: To fight with domestic players and to increase the market share these local comp anies made a tie up with the foreign players due to which the flow of capital wi ll increase as well as they will bring new technology and by this they will be f ar ahead of their domestic counterpart and due to this their market share will i ncrease with not giving more stake to the foreign players and having the control over the business by having 3/4 of the member in the board of the company. The newspaper industry has relatively high entry barriers due to the strong bran d equity of existing players. Approximately 7% of the population in urban areas read English-language newspapers. Hindi and vernacul ar language newspapers offer a local and regional flavour to their readers. with a readership o f approximately 15% and 5% of persons in urban and rural areas. If FDI is allowed in India allowed then i ts obvious that the domestic players competition will increase and their market share will be reduced but they restricted the entry for certain period only but in 2002 government open the sector for FDI. Times of India follows strong brand loyalty in Mumbai and it was difficult for Hindustan Times to enter Mumbai. in addition to their strong presence in urban areas. existing players have strong control over th e distribution network. The print med ia is further divided on the basis of the languages. with existing players enjoying stron g brand loyalty. Jharkhand Deccan Chronicle Andhra Pradesh The Hindu Chennai The Telegraph Kolkatta Deccan Herald Bangalore Punjab kesari Punjab Source: Companies. making it difficult for new players to enter. (Source: IRS 2005) In contrast to t his. Th e newspaper industry is regionally divided. are l argely focused on the primary urban centers. ab out 46% are vernacular.3% of the population in the rural areas. Higher income for advertising in national players (regional players are earning less): . Hindi-language newspapers have a proportionately larger readership in rural areas. Of the daily newspapers. For e. The content and circulation of English-language newspapers. 44% are in Hindi and 10% are English. compared to a readership of onl y 0.

And it also depends on the presence of that regional player in the parti cular region. due to lack of funds and localized nature of the newspaper busin ess. Income of circulation: Income of circulation is higher than income from advertisement for vernacular pa per and vice versa for national news papers that is the national players are hav ing their majority because of their presence in whole country the companies are attracted to give ad in national level news paper due to this their reachness wi ll be high because of higher number of reader and due to that they national play ers are having most of their income that is around 75% to 80% of their income is from advertisement only but they are having only 15% to 20% of their income fro m subscription because of their presence at national level and not having that much presence at the regional level but for the regional level the main source o f income is from the subscription that is around 20% to 75% because they are hav ing presence in particular region only and due to that they are not having much of their revenue from advertisement. Moreover. Industry shakeout: A growing market and the potential for high profits induces new firms to enter a market and incumbent firms to increase firms to increase production. The industry may bec ome crowded if its growth rate slows and the market becomes saturated.Because the national players are having their foot hold in the whole country so if any individual or a company wants to give advertising in news paper they will go for national players only because of their presents every where the reach of advertisement is also increased and due to that it becomes beneficial for the c ompany who is giving advertising in news paper but this kind of benefit is not a vailable for regional players because they are present in particular region only and not in whole country so if a company gives any advertsient it will be restr icted to that particular region only. Family owned businesses: Most Newspaper businesses in India are family owned and have a strong regional f ocus. Low levels of product differentiation: It is associated with higher levels of ri valry. For example Jag . A sha keout ensues. Marketing Strategy: New schemes in subscriptions by different news paper: now due to higher level of competition in the newspaper business the companies are implementing aggressive marketing strategies and coming with different marketing schemes due to which t hey are able to increase their earnings and can increase their market share for eg Divya Bhaskar had come in Gujarat with the schemes of coupons and gift after collceting that coupon for one month and due that it sales was increased treme ndously but than after certain period of time its competitors like Gujarat samac har and sandesh also came with the same scheme and at that time the sales of di vya bhaskar was affected. price wars. A point is reached here the industry becomes crowded with competitors. their earnings are around 25% to 80% earnin g only. on the other hand. Brand identification. Low switching costs increase rivalry: When a customer can freely switch from one product to another there is a greater struggle to capture customers. tends to constrain rivalry. most of them have remained content in their own boundaries. with intense competition. and company failures. creating a situation of excess capacity with too many goods chasing too few buyers. and demand cannot s upport the new entrants and the resulting increased supply.

(Source: IRS 2005) In contrast to t his. Newspaper Place of strong hold Jagran Prakashan Uttar Pradesh and Uttaranchal Times of India Mumbai HT Media Delhi. on the other hand. Times of India follows strong brand loyalty in Mumbai and it was difficult for Hindustan Times to enter Mumbai. The newspaper industry has relatively high entry barriers due to the strong bran d equity of existing players. with existing players enjoying stron g brand loyalty. Newspaper Place of strong hold Jagran Prakashan Uttar Pradesh and Uttaranchal Times of India Mumbai HT Media Delhi.g. Hindi and vernacul ar language newspapers offer a local and regional flavour to their readers. Th e newspaper industry is regionally divided. Equitymaster • New entrants: Fragmented industry The regionalism aspect is clearly visible in the newspaper sector. compared to a readership of onl y 0. Also. Hindi-language newspapers have a proportionately larger readership in rural areas. The content and circulation of English-language newspapers. ab out 46% are vernacular. are l argely focused on the primary urban centers. The print med ia is further divided on the basis of the languages. For e. with a readership o f approximately 15% and 5% of persons in urban and rural areas. existing players have strong control over th e distribution network. Jharkhand Deccan Chronicle Andhra Pradesh The Hindu Chennai The Telegraph Kolkatta Deccan Herald Bangalore Punjab kesari Punjab Source: Companies. respectively. Approximately 7% of the population in urban areas read English-language newspapers. 44% are in Hindi and 10% are English. Of the daily newspapers. Bihar. Bihar.aran Prakashan is Market leader in terms of market share only because they have strongly grabbed the market of North to east region. making it difficult for new players to enter. in addition to their strong presence in urban areas. Jharkhand Deccan Chronicle Andhra Pradesh The Hindu Chennai The Telegraph Kolkatta Deccan Herald Bangalore .3% of the population in the rural areas. Like wise every company hav e their own competent area.

New player can easily have their business Common Technology: In this industry role of technology is not that much visible. Scanning & packaging. Here in this industry the cost of production is comparative less and that thing is positive for new en trants. Only different typ es of machine for printing. • Threat from Substitute: A. in most cases it makes competition unviable. Intense Competition: Due to low cost production and low switching cost for buyer. Equitymaster Strong Entry barriers Newspaper business has extremely strong entry barriers owing to strong brand equ ity. as advertising revenue in a region is generally absorbed by the top-two playe rs. In s uch industry where competition is very high. Moreove r. Television to newspaper: 1. entry is not easy at all. there N number of n ewspaper and magazines are available which makes industry more competitive. Top 20 news channels and their share in over all TV channel (source: TAM people meter system) .Punjab kesari Punjab Source: Companies. readership loyalty and requirement for a wide distribution network. News channels In television constant update of the news is available so changes taken are spee dy and get that information at that particular time only whereas in newspaper no at time update is available as well as you cannot able to get fresh news in new spaper. Cost of production is low anyone can easily enter in the industry: For any industry the major problem is cost of production. Low switching cost: Cost of newspaper is very negligible that’s why for an individual switching cost t o newspaper is low.

The most expense in television advertisement is of production o f advertisement. song and dance sequences. Then af ter advertiser will have the expenditure of telecast of that advertisement. TV advertising has a lasting impact. who can forge t Aamir Khan saying “ Thanda Matlab Cocacola” or Sachin Tendulkar in Pepsi advertise ment. This factor has the threat that televis ion can grow faster with the help of foreign players. famous personalities exhi biting products. audio and visual. Now channel have also stands for specific area like News. models. An advertiser can use all the creative tools that on e can use in advertisement. (ii) With catchy slogans. Now-a-days peop le are switching on channels whenever there is a commercial break which is calle d Zapping in advertising terms. While the print media advertisement only provide the visual effect but can not provide motion in it. For example. Music channel. (iii) With varieties of channels and programmes advertisers have a lot of choi ce to select the channel and time to advertise. • Advantages (i) It is most effective as it has an audio-visual impact: The biggest advantage of television as a medium of advertising is it has both th e effect. advertisers are focusing on children for ev erything. . eyes and ears. Another good thing with television advertisement is that it the only medium that uses two organ of human body which are highly effec tive. Companies s have seen that television advertising can make an effect o n children which print advertising can not in 20 times (Source: equity master Aug 29. If we go more sp ecific then we have Business News and Cricket as sports channel. music director and also need to book a production house which is very expensive in nature.2. (iv) With regional channels coming up any person even illiterates can watch t he advertisements and understood it by seeing and hearing is another good advant age of television. Regional channels through television players are penetrating in semi urban / rural area. 2007) 49% stake of FDI in television (print only 26%) Television is the most competitive substitute of print media. (ii) With almost every manufacturer trying to communicate their message throu gh TV advertising the impact among the viewers is also reducing. Entertainment. Sports. The major plus poi nt of television is that government has allowed FDI in television up to 49% whil e in print media it is only 26% allowed. Marketer’s influence towards children to target: In current era of advertising world. • Limitations (i) TV advertisements are usually expensive to prepare as well as to telecas t advertisement. An advertiser need to have director.

094.B.000.000 1.000 42.000 1.7 % C. YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Users Population % Pen.000 40.6 % 4.528 Usage Source 0. Almanac C.094. T he decrement in year 2006 can be because of change in its source.000 50.677 2.112.870.000 1.7 % ITU 1. 2007 .870.094.870.870. 1.3 % ITU 0.500.094.6 % 3.500.225. Internet blogging to Magazine 1.5 % ITU 0.094.677 1.677 5.500.812 1.6 % ITU 2. Almanac IAMAI IWS Source: JuxtConsult.677 22.677 7.200.1 % ITU 0.000.870.000.600.000 1.I.112.000 1.094.129.812 1.225.667.400.094.870.800. Increasing internet user Year over year the penetration level in internet is increasing up to 2005 it is increasing like anything but in year 2006 shows the decreased figure than year 2 005 and then again year 2007 reveals increasing trend in internet penetration.I.000 1.000 1.870.5 % 3.1 % ITU 3.677 16.677 39.

The interest and habits of individual is gett ing changed day by day. 2007 2007 (M) 2006 (M) Growth (%) Total urban Internet users 30.6 28 Regular Internet users (at least once a month) 25. Also the number of people who are regular user increased by 15% in 2007 compare to 2006. Urban India Internet Users by Type. Urban India Online Activities by Regular Internet Users.65 212 Source: JuxtConsult.32 23. Those who are occasional internet user are increased by 212% in year 20 07.15 1. share of print advertisement will d ecrease because the budget of advertiser is fixed always. 2007 (%) Rank Online Activity 2007 2006 Change 1 E-mailing 95 94 1 2 Job search 73 53 20 3 Instant messaging 62 37 25 4 Check news 61 53 8 5 Online music 60 48 12 6 Chatting 59 49 10 7 E-greetings 58 57 1 8 Check sports 57 35 22 9 Online games 54 35 20 10 Dating/friendship 51 27 25 Source: JuxtConsult.As many numbers of people penetrate to use internet. checking news and checking sports which are also given by newspaper.95 15 Occasional Internet users (less than once a month) 5.17 21. If advertisers start to be attracted by internet th an they will give advertisement on internet. As given in below table that number of people who are using internet for Job search. 2007 The some of the best things that newspaper providing is provided by internet als o and people use internet for that also. it can be harmful for print media because as many number of people increase using internet big advertiser w ill be attracted towards it. 2007 Classification of internet user based on users characteristics URBAN POPULATION IN (MN) URBAN POPULATION 250 LITRACY POPULATION 205 ENGLISH KNOWING 77 PC LITERATE 65 CLAIMED USER 46 ACTIVE USER 32 Icube report 2007(source: PITCH FEB-2008) .

Almost majority is covered here. college students. 2. (ii) It is not very suitable for general public. This facility is very useful when the target audien ce is based on high on ID personality as per Freudian theory of personality for the product like Domino’s Pizza. News Cricket Movies Automobile lover Music and lots of other blogs are available online which are giving direct competition to magazine. (iii) It is not suitable for illeterate and those having no knowledge about the operation of Internet. Online shopping: Internet facilitates an individual to purchase any product while he/she is watch ing an advertisement online. .Demographic break up of internet user working woman 11 College student 21 school going kids 14 older man 15 young man 33 Non-working wonen 6 (source: PITCH FEB-2008) Percentage Demographic break up of internet user is showing the types of internet user and other details of them. Internet Blogging Another big threat of internet is ‘Blogging’ – a specific blog for specific group like : 1. • Limitations (i) It is not accessible without a computer. Magazines were the only medium to reach to specific target segment one can reach to women segment to IT professional but after introduction of int ernet blogging. 5. 4. (ii) User can see the advertisement at their own time and as per their requireme nt. • Advantages (i) Information from all over the world is made available at the doorsteps. young ma n and old man. It is also a noticeable point for magazine because the in ternet user includes woman (working and non working). While in news paper the reader has to visit that shop and has to give the order. 3. 2.

There is a positive thing for magazine is that still the internet blogging is no t considered as a creditable source. Radio: Radio with Newspapers Characteristics of Newspapers Newspaper brings immediacy to a communication. Newspapers also have the author ity of the written word. Windows Live 9. radio also reaches non-readers so it can signifi cantly increase coverage.com/blog/?p=59) C. t he national press suffers from clutter and from the fact that the reader can and does edit ruthlessly to avoid advertising. Google 4.sybrant. in most sectors. Yahoo 2. Rediff 6. Youtube 7. adding radio also means increased sha re of voice thus overcoming clutter In communication     . Blogger. The Top Ten sites internet users browse in India are the following: 1. and are good at presenting detail. and this is real frequency in that exp osures take place in real time. As a print medium. What radio adds: In planning radio adds frequency with little zapping. Wikipedia (Source: http://www. Rapid Share 10. Google India 3. Orkut 5.com 8.

cooking. the high levels of clu tter. housework etc In detail Radio offers fast turnaround within the long copy deadlines of magazines. But. speaking in a more personal way than press. but you can hear radio. Similarly. radio allows brands to emphasize specific key times of day (press re ading is spread across the day) Geographic variation flexibility means radio allows geographical variation on top of a national press campaign Radio with Magazine: Magazines are useful to advertisers because of the relationship they have with t he readers. radio also offers a greater share of voice for most categories. which means overcoming clutter. occasional liste ners tend to forget what they have heard in Radio. In communication Radio brings intrusiveness to a magazine campaign. while driving you can hear a radio but cannot read a newspaper. da y of week and even week of month. There may be some other di sturbances that distort communication. but you can not read newspaper. (iii) There are places where newspapers reading may not possible. Weaknesses of magazines include the fact that lead times can be ver y long depending on the title s frequency of publication. In many magazines the ads are seen as part of the magazine experience. They allow targeting by lifestyl e and interest group. and there is less ad avoidanc e. (ii) The message that any advertisement wants to communicate may not be prope r as there is no chance to hear it again immediately. radio brings brand messages closer to the individual. What radio add: In planning Radio adds frequency and there is little zapping.Radio brings intrusiveness to a press campaign. and th e opportunity for geographical variations • Advantages (i) (ii) It is more effective as people hear it on a regular basis. radio also extends coverage we ll beyond the magazine readership. It is also useful to illiterates.driving . radio can bring to life ideas which might seem flat on the page. • Limitations (i) A regular listener may remember what he has heard. radio can mo re strongly convey the advertising tone of voice (important for service brands).time of day. Radio is less effective as it lacks visual impact.       . radio can bring to life ideas which might seem flat on the page. and there is less ad avoidance. (iii) In comparison to Television. you can hear radio while traveling on road or working at home. who can not read and write. who consume them in a personal way. radio can more strongly convey the brand s tone of voice (important for service brands). radio allows brands to speak to consumers close to certain activities . For example. and the reader s inclination to simply turn the page. radio allows tighter timing .

the shopkeeper sometimes gives you a key ring to hold the cycle key. E. Outdoor media: Hoardings While moving on roads you must have seen large hoardings placed on iron frames o r roof tops or walls. to buyers and prospect ive customers. While using. Posters Poster are printed and posted on walls. In all these items the name.D. buildings. et c. The attribute is that an individ ual will always check the SMS before deleting it. the SMS advertising can reach to the target audience. Some jewelers give small purse or boxes when you buy a jewellery. These items are normally items of daily u se given freely to the customers. trains. Unlike hoardings these vehicles give mobility to advertisements and cover a l arge number of people. calendars. bridges etc to attract the at tention of customers. These are normally boards on which advertisements are pain ted or electronically designed so that they are visible during day or night. or trader or service provider as well as descriptions of the produ cts in which they deal in are printed. the user remembers the products a s well as the producer. Even it will not have chance f or zapping or zipping like in television commercials. Posters of films which are screened on cinema halls are a common sight in our country. purse. Vehicular displays You must have seen advertisements on the public transport like buses. Medium Reach Cost Strike Rate Television One of the Highest Very High Radio Medium Medium Poor Internet (Banner) High Medium Dropping Email High Extremely Low Extremely Low PRINT MEDIA HIGH HIGH HIGH Billboards Medium Medium Medium Moving Media Medium High Medium Telephone Medium High Medium Fax Low Medium Low Good . The advertisers have to pay an amount to the owners of the space. Gift Items from manufacturers When you buy a cycle. where the hoardin gs are placed. which is growing at ve ry high rate only because of its own attribute. etc. Even by creating a databas e. address and telephone number of the manufacturer. Som etimes manufacturers give diaries. SMS advertising the new medium The latest trend in advertising world is SMS advertising.

which prevent the industri al plantations of private sector on degraded land stretches. Though an estimated 55-million tonnes of bagass e is available.Mumbai Mysore Paper mills – Bangalore NEPA papermills . For small adv ertiser the SMS advertising is more affordable and preferable. Short supply The wood pulp which is used as a raw material of newsprint is in short supply. The Indian paper an d newsprint industry has already urged the Government to amend the laws with a v iew to permit them to make use of the degraded land for raising plantations of f ast-growing trees. Many paper and newsprint production units are working towards becoming self-suff . Switching cost is low Switching cost of newsprint is very nominal and there are options that easily pr ovide raw material with lower cost. • Bargaining power of Supplier: Few major players Though there are over 500 paper and newsprint production units in India. . It is the only medium which has higher reach and strike rate with lowe st cost while in Print media reach. There are three major players in supplying the raw material of newsprint. if advertiser wan ts to advertise his product in print medium there are vernacular newspaper and m agazines available that have comparative less cost. not eve n 10 per cent of theses are big or dynamic enough to turn out quality paper prod ucts at a competitive price.Nepanagar Over 60 per cent of the newsprint production in India is concentrated with a few state-owned units by Hindustan Newsprint Ltd (HNL) and Tamil Nadu Newsprint and Papers Ltd (TNPL).Standard Mailers High High Personal Interaction Low High SMS EXTREMELY HIGH EXTREMELY LOW Medium High EXTREMELY HIGH The above table reveals the comparison of SMS advertising with other mode of adv ertising. But. the Government is yet to respond. which is used in printing the newspaper.Chennai MP Rama Newsprint Ltd.. • • • • • Hindustan newsprint Ltd. strike rate and cost are high. rice and wheat straw instead.Calcutta Tamil Nadu Newsprint and Papers Ltd. only eight per cent is currently put to use for paper production . T he biggest stumbling block for production units keen on attaining self sufficien cy in wood pulp is the prevailing environmental laws. (HNL) . So many of the leading paper mills in the country have taken to social forestry schemes under which small and marginal farmers are provided saplings and know-ho w for raising plantations of fast growing trees with an assurance of a buy back at a remunerative price. Many of the paper production units are now using bagass e.

South India-based Seshasayee Paper and Board Ltd. Once the expanded pulp mill capacity is in place. Other Big player’s entry.00 tonnes of paper boards and fine paper a year. – Chennai that’s why they are having the nearly 60% share of newsprint b usiness.000million. The PSPD has a unique business and revenue generation model. (HNL) – Calcutta and TamilNadu Newsprint and Papers Ltd. Major customers of suppliers.00. It started operatio ns in 1979 in Bhadrachalam primarily because it was a forest area and provided a ccess to raw materials. 5. is also mul ling to put up a cement production unit that would make use of waste lime sludge generated from its paper-making operations and fly ash generated in its power b oilers. 3. is now close to commissioning its new pulp production mill designed for boosting the pulp production.” is ITC’s aim. Like Balla rpur Industries Ltd (BILT) has now drawn up a 20-million Euro plan for the moder nization and augmentation of the facilities at Sabha Forest Industries (SFI) of Malaysia. by early 80s strict regulation on the use of fo .000-million for expanding its production capacity to 4. There is at some part differentiation in quality of newsprint is higher in Hindustan newsprint Ltd. 3. 4. 2. from the new borns to 15 years of age. 1. TNPL known for its range of prod ucts including printing and writing paper and copiers and newsprint. On the other hand. However. Paper Boards and Specialty Papers Division (PSPD) of the FMCG (Fast Moving Consumer Goods) giant ITC has gone in for an innovative range of p roducts with an eye on emerging as the largest outfit in the paper production se ctor.45. Lack of Financial resources Not having big Brand name Not having experience in this business Expansion in capacity Tamil Nadu government-owned enterprise TNPL has unveiled an ambitious action pla n to invest Rs. The modernization programme will see its in-house pulp production going up to 440-tonnes a day from 240-tonnes a day. the company will initiate work on boos ting its paper manufacturing capacity with an additional investment of Rs 3. Differentiated input (quality. Another thing they are in business from many years so they do have the learning curve and experience benefit.000-tonnes. acquired earlier. 2.00. used in paper manufacturing. “Our specialization in producing value-added paper boards has made us realis e the huge potential for creating gifts and toys for 200 million children. Its Bhadrachalam facility is now pr oducing 4. cost value added ) Differentiation input is the only point which shows the bargaining power of supp lier over here.icient in wood pulp and other feedstock’s.10. Jagaran Prakashan BCCL Hindustan Times Deccan Chronicle Malaya Manorama Threat of forward integration: There is not any kind of chance of threat of forward integration of supplier in this industry because of: 1.000tonnes a year from the present 2.

Even the switching cost for agencies is not much higher but again the preferenc e of advertiser also plays a vital role over here.rest resources was introduced and this forced PSPD to look for alternative sourc es of raw materials. A gency make advertisement and they also contact appropriate media to publish or t elecast the advertisement. 1. They are the real consumer and only because of them industry is having existence but they do not have influenc e more than content of any news which is the most key success factor of any news paper or magazine. they craft the advertisement in house and then contact newspaper or magazine to publi sh their advertisement. They purchase it in very nominal prices so they do not have any influence to print media. So. 2. if the newspaper or magazine does have strong brand name like ‘TIMES OF INDIA’ then agency can not suggest advert iser not to advertise on that particular newspaper. The advertising agencies do have little influence on print media players because they are the mediatory one and because of them industry player gets advertiser. Small and medium companies: The small and medium companies can not afford the expense of agencies. Basically t hey play the role of mediatory. Advertising Agencies Small and medium companies Advertising agency: The advertising agencies are the first layer buyer of this industry. Thus it forayed into the farm forestry programme by tying u p with small and marginal farmers to raise plantations of fast growing trees. they contact different corporate or corporate co ntact them to make corporate promotion strategy and promotional activity also. Consumer Consumers are the common people who purchase newspaper or magazine. 3. They purchas e it for news purpose or reading habit. . Export of paper and other things are ban so suppliers power will increases due t o domestic purchase: Bargaining power of Buyer: There can be three types of buyer in the print media industry and they are as be low: 1. In such situation they do not have any influence on news paper or magazine. 2.

0.9 0.19 0. It analyzes the impact of investing resources in different businesses on the corporation’s future earnings and cash fl ows.1 0.14 0. One of the first and best known of the portfolio model is the growth share matri x developed by the Boston consulting group.Overview of Five Force Analysis Threat from new entrants/entry barriers Rivalry against competitors Threat from substitute Bargaining power of buyers Bargaining power of supp liers Low √ Low to moderate √ √ Moderate Moderate to high √ √ High • B C G Matrix The Boston consulting groups (BCG) Growth-Share Matrix.87 0 1. .5 0.18 0. Here the vertical axis indicates the industries growth rate and the horizon tal axis shows the business relative market share.5 0. The Boston consulting group’s model of print industry 2 1 3 35 1.15 0.12 0.

5mn (ABC JJ 2007) First published in 1 942 as Jagran.bennett Coleman & co ltd. Here in print industry jagran prakashan is the market leader with the growth & s hare of 18% and 35% respectively. but also consume large amounts of cash because of their high growth rate. If a star can maintai n its large market share. it will become a cash cow when the market growth rate declines. Strategy recommendation for star (high growth.18% ABP group 6.the companies are 1. th erefore the cash in each direction approximately nets out.60% Malayalam Manorama group 5.05% The growth share matrix assumes that a firm must generate cash from businesses w ith the strong competitive position in the mature market.18% Deccan chronicle group 6. In the B C G matrix of print industry the overall growth of print media is shown is 21% Here we had taken 6 top companies having the maximum market share . Resource Allocation and Strategy Implications of print industry Each of four cells in the growth-share matrix represents a different type of bus iness with different strategy and resource requirements.71% The Hindustan times 12. & others. 3. It is computed by dividing the business’s absolute market share in dollars or units by that of the leading competitor in the industry. The model represents business ra pidly growing industry as more attractive investment opportunity for future grow th and profitability. the paper is now published in in 37 editions (five launched in th e last couple of months) across 11 states.jagran prakashan 2.ABP group ltd.28% others 4. Dainik Jagran enjoys the distinction of maintaining its lead over the other Hindi newspapers. And after calculati ng the relative market share it has seen that most of the companies fall in the star group or the build (question mark) group.5mn readers ( IRS R2 2007) and a daily circulation of 2.malayam manorama 5. the market growth rate on the vertical axis is a proxy measure for the maturity and attractiveness of an industry. the relative market share is a proxy fir its competitive strength wit hin its industry. Here from the matrix sheet it has b een seen that most of the companies are in the growth stage. 1. Thus. high market share): Stars generate large amounts of cash because of their strong relative market sha re. Its have newspaper dainik jagran in Hindi lang uage which is highest sold daily in India with a strong base of 16.Publication group market share Jagran prakashan 35% Bennett Coleman & co 30. Then it can fund inves tment and expenditures in industries their represents attractive future opportun ities. and its readership base is substantially higher than the Top-five English dailies combined. Similarly. JPL has sel . The portfolio of a diversified company always should have stars that w ill become the next cash cows and ensure future cash generation.hindustan time’s 4 .

MM & others are come Strategies for Bennett Coleman & co: As per growth wise Bennett Coleman & co is the highest in India with the growth . All players who are come under this group are trying to increase their mar ket share. Strategy for leader (jagran prakashan): Expand (cover) the market: As per readership survey done by IRS. Strategy recommendation for build(question mark): Question marks are growing rapidly and thus consume large amounts of cash. And in chattishgarh it interviewed 2606 read er dainik bhaskar is the market leader it covered 1095 readers.ectively entered the English Print Media with the launch of two new offerings vi z. D C. It clearly shows that dainik bhaskar is the market leader a nd it covers 5744 reader in survey. A question mark (also known as a "problem child") h as the potential to gain market share and become a star.. New edition and alternative media: For maintain the market share jagran prakashan should have produced new edition and try to add more supplement to attract the costumer. In this group relative market share of the company is low er and market growth rate is high. The result is large net cash consumption. So its shows pos itive market foe the jagran prakashan. ABP LTD. Here it interviewed 13654 r eaders in Rajasthan. So its shows positive market for the jagran prakashan. also its c ompetitor H T MEDIA & BCCL have there own radio station which shows positive gro wth. City Plus (English weekly infotainment) and I-Next (bilingual compact tabloi d) in its existing as well as new markets. HT EDIA. Because print media comp anies enjoy extremely high operating leverages once their edition launches stabi lized and start generating strong advertising revenue. 2. Because jagran prakashan cover entire Hin di belt and it already cover 40% of the population there is one survey by angel research shows that 68% of the population of the India read Hindi language also low newsprint cost help the jagran prakashan because it purchase 65% newsprint f rom the domestic market. and eventually a cash c ow when the market growth slows. If the question mark does not succeed in becomi ng the market leader. Here companies like BCCL. It clearly shows that Rajasthan and chatti shgarh are the open market for the jagran prakashan.its highly active in northern part of India. This group shows market opportunity in the ma rket. So radio should be a profitable venture for the jagran prakashan. And also it joined with the TV 18 for Hindi/regional busines s dailies . Question marks must be analyze d carefully in order to determine whether they are worth the investment required to grow market share. Growth of radio industry in 20 07 is 325 as compared 2006 are 28% it shows 4% increased in one year. It also has Hindi magazine sakhi whic h have high market. then after perhaps years of cash consumption it will degen erate into a dog when the market growth declines. Radio is the growing industry right now. Due to it generates free cash flow and thus they invest certain alternatives which generate good income f or them. but b ecause they have low market shares they do not generate much cash.

So if it have ti grab the market share it should have to come w ith the newspaper with specific hindi language. So it is important to maintain re lationship with the advertiser and advertising agency.C Score Market share 0. even B C CL and Jagran prakashan also purchase newsprint from the domestic market. And HT MEDIA purchase 75 % of its news print from the international market. G.6 HT 10 Score 2 Jagran 6 . Content of the HT MEDIA and Deccan ch ronicles magazines and newspaper is not very good.E 9 CELL Matrix of Print Media Business strength Score D. Strategies: Come with flanker product in northern region: Northern region is the very big region. Here BCCL still doesn’t find a space at northern region. Because of the hike in price company have to pa y more money to the newsprint provider. So from our point of view follower shoul d have to purchase newsprint from the domestic market. 29 niche magazines . Turnover in excess of USD 700 million . 5 dailies including two of the largest in the country with approx 4. Deccan Chronicles.Reaching 2468 cit ies and towns .there is one survey done by Angel research shows that time s of India loose it advertising revenue up to 5% in the year 2006 because of hi gh ad rates.8 weightage M.6 BCCL 8 Score 1. Becau se newsprint price in international market is rise up to 10 to 12% its shows 2% increase in the newsprint price. It reaches out from: 11 publishing centers.market share of BCCl is 30.rate of 22% which is higher than market leader jagran prakashan. 15 printing centers. Strategy for (followers) HT Media. AD rates: Compare to the other BCCL charged higher rates.2 1. 55 sales offices. So news print cost of the both company account almost half of the company’s expenditure.: LESS sensitive towards newsprint prices : HT MEDIA and Deccan chronicles are high sensitive toward newsprint price. Editorial content: Content should be specific and attractive. Malayala Manorama and A B P Ltd.3 million co pies circulated daily . So its shows negative impact in the revenue growth . So for improving the content it should have hire intelligent and creative editors and journalist.2 4 0. which is h igher than market leader. News p rint cost of Deccan chronicles is 432cr and cost of H T MEDIA is 204. In the northern region HT MEDIA and Jagr an Prakashan have very good market share. This shows the impact on its revenue. Because in the northern part mos t of the people prefer hindi language newspaper. Over 7000 employee s.M Score 8 1.71 which is lower than market5 leader.readership of times of I ndia is less then dainik jagran because of language problem. 2 lead magazines . It is headed by brothers Samir and Vineet Jain of the Sahu Jain family. Established relationship with the local advertiser and the advertising agency: Most of the revenue come from the advertising. Because Deccan chronicles purchases 90% of its newsprint from the international market. newsprint quality of the domestic newsprint is very good . The Times Group is one of the largest media services conglomerates in India.

15 4 0.5 1.25 7 0. India’s GDP of last three year is about 8% while mar ket is growing at a rate of 18-19% last eight Years.1 0.3 8 0.8 8 7 6 1.275 0.475 5.35 0.05 Rating Score 1. Industry Pro fitability. Government Rules and Regulation and Domest ic Economic Condition. Market Size.75 For the GE nine cell matrix on the Y axis we have define Industry Attractiveness that is measured on the parameter like Market Growth.7 0.assocham.4 8 7.7 1.5 Profitability 0.7 5 0.7 0.9 6 0.9 8 1.2 6 1.15 5 6.1 1 6 0.org/prels/shownews.75 6 0.8 0.5 1.Cost of production 0.8 7 7 8 1. Generally 9 cells are studied for position of that industry and its future co .20 0. Market Growth is important because by this parameter we can find that that indus try is growing at which rate if is higher then GDP growth rate then industry Gro wth is Good define Kotlar and it is lesser then GDP growth rate then it is consi dered as a attractive market.2 Competitive Strength/Market Position Industry Attractiveness Industry Attractiveness Growth 0.20 Opportunity/Threat Political factor Uncertainty & Risk Total 0.6 5 0.75 0.6 Bargaining power of supplier 0.php?id=1281 GE 9 Cell matrix Competitive Strength Poin t Industry Attractiveness GE9 cell matrix it is about the study of the industry attractiveness that is abo ut if the investment in the industry is made than will it be profitable to stay in that industry for a long period of time and will be able to earn a good profi t.9 8. Intensity of Competition.75 6 1.1 Weightage 1. Source: http://www.2 9 1.6 9 8.8 7 5 1 Brand image 0.2 5 6.15 8.8 10 9 7 1.2 0.25 7 Competition 0.05 6 0.5 Bargaining power of buyer 0.85 8 0.60 0.9 Growth 0.6 6 0.1 8 7 0.15 10 1.

And the weightage giv en to growth of the industry 25%. . Due to that readership of newspaper will increase. it just like pros and cons of that industry if the opportunities in that industry are more than the industry is in the grow th stage. (Source: Pitch February 2008) It shows that there are ups and down in the industry but the industry is in the increasing stage which is seen from the year 2004 to 2007.nditions. This includes study of all the factors affecting the industry like pol itical factors which is one of the main factors taken in to consideration while studying the attractiveness of that industry for print media the factors taken i n to consideration FDI limit that is 26% for news segment and 100% for non news segment. . Opportunity and threat: It related to that particular industry are taken in to consideration before ente ring in to that particular industry. Even the literate population is also increasing in India. And due to that the political factor has been give n the weightage of 15% out of 100%. Growth rate: Then after growth rate of that particular industry is taken in to consideration because on the basis of the growth rate only the position of the company in the product life cycle can be known. Even the government may put restriction by putting control over the fu nctioning of the companies through several norms and regulations putting ban on certain kinds of advertising. level of competition It is very high in the industry and the players are always fighting for making t he highest share and covering the larger market and try to earn maximum from adv ertisement and circulation and due to that more weightage is given that is of 20 %. The weightage given to oppo . But as the literacy level increases the people are more attracted towards the internet usage which is one of the biggest for the pr int media advertising. Like as India is a developed country industries are growing and d ue to that to make buyer aware about their product and due to that income for pr int media is going to increase. One of the biggest opportunities for the print media advertising is that still 3 59 mn literate adults don’t read any publication. In the print media also there are many opportunities available as comp are to threat. In print media industry the growth is taken to study before investing last 4 years growth is shown in the below figure. This may be prove to restrict or may be proved to be beneficial for the company. Now number of 24*7 readership has been increased which is giving constant update of news and it is the major threat for print media.

Uncertainty: If in any industries if uncertainty is more. the highest rank is giv en to those factor which are very important for the development of that industr y. eg increase in ove rall price of paper affect the profit of all the players. though external factors are affecting to the industry but they are common for all the industries. the study of d ifferent players and their position in the industry is necessary to be studied o n the basis this study position of different players is studied by taking certai n factors taken in to consideration and different weight are assigned to differe nt factors. if the cost of production is high than it will directly affect the earning of th e company. And on that basis different ranks are given to different players in the industry on the basis of their market share in the industry. In this industry the highest ranks are given to the factors like growth rate and level of competition which plays an important role for the development of th e industry. Generally if price of any production materia l increase it will affect to all the players of the industry. But it was seen that in the cost of production it includes cost of pr int includes paper. Here uncertainty is less so it is given less wei ghtage of 15%. Business strength And on the basis of the information the ranks are given to the factors taken in to consideration which are necessary to study the attractiveness of the industry .rtunity and threat are 25% because they are playing important role for print med ia advertising. the highest rank is given to those factors which are very important for the in dustry and which affect the development of the industry.C 6 M. Now after considering industrial strength and its attractiveness.And the company who is facing this kind of problem less are given the highest rank and the weightage gi ven to this factor is 10%. but there is no factor as of uncertainty in the print media a dvertisement. ink and plates.6% 12. And due to that highest weightage is given of 20%.M 4 Cost of production is an important point to study the earnings of that company.18 6.71% 35% Market share . Now the first point taken in to consideration is the relative market share of al l the major players on the basis of that the position new entrants can be known. 5. than development of that industry i s quite difficult.18 30. Company name Rank Jagran Prakashan 10 BCCL 8 HT 8 D.

so less weightage is given of 10%. But the Deccan Chronicles and Malaya Manorama lies in the cel l of medium priority where the hold is required because they are facing high com petition. Profitability: It is the major point to be taken in to consideration if the current players are earning good profit then other players will be attracted to invest in the busin ess. And after the given weightage the score is calculated on the basis of which the allotment is done in different cell of the matrix and on that basis the position of that particular player can be known and from the 9 cell matrix of the print media the position of the top 5 players can be known and on the basis of their score the allotment is made in the different cell. then after Jagran prakashan got the share of 20% and ran k given is 8. . Here the benefit for the daccn chronicles is that it can easily import from outside at low cost. And even the bargaining power of the the supplier is also less in India because in the industry most of the newsprint is imported and it is 70%.Bargaining power of buyer and supplier: Bargaining power of the buyer is low for the industry and due to that less weigh tage is given of 10% only. Weightage given to the growth is 20%. not using proper resources. but if the current players are facing difficulty in earning good profit the n it will not motivate others to invest in the print business and on that weight age is given of 15%. They are in this c ell because they are having the highest market share and properly using their r esource properly. Growth: The growth factor is taken in to consideration that in future is there any furth er growth in the business and on that basis it is decided whether to invent in t he business or not. And the ranks are given on the basis of their profit where BCCL got the highest rank of 10 and Malaya manorama got the lowest rank of 6. Jagran prakashan. and the lowest rank is given to Deccan Chronicle because of its la te try in many southern region and the rank is 5th. Here jagran prakashan is given goo d brand image in whole northern region and having 40% of India’s readership and it is given the highest rank and than after the highest rank is given to Times of India of 8. Bennett an d columan company Ltd and Hindustan Times lies in the same cell of high priorit y cell and in that the company are in growth and build stage. here the growth of BCCL is higher that is of 22% so BCCL is given the highest rank. the lowest rank given to MM of having growth of 12% and the rank given is 5th.5. Brand image: The weightage given to the point is 15% because in many areas sales are depend o n the brand image of that particular company. So if these companies properly use the resources then only they can move to upper cell and eve they have to study properly the region in wh ich the leader are not present in that area these player can cover the market sh are. and newsprint cost of the daccan chronicle s is higher because it imporet 90% of the newsprint from the international marke t.

Growth of Small Scale industries: From the above table it is seen that the growth of small scale enterprise increa ses due which number of advertising in the news paper will increase because gene rally small Source: www. literacy level. Government policies: Government policies directly affect the working of the industry that is if the g overnment make the smaller change in the policy related to media it will directl y affect the print media. The driving force for the print media are government policies.org.rbi. When in budget the service tax on the on the space for advertising was increased from 10% to 12% for the television but it was not inc reased for the space for advertising in print media and due to that cost for adv ertising in television media and due to that there was increase in the demand f or print advertising and it is having the maximum reach to different region of t he country which is beneficial for the corporate. with the help of advertisement they would like to increase their sal e and the regional level of newspaper are the best platform to reach their targe t customers.Driving Force The force due to which the industry is driven and due to which its earning is di rectly affected. chapter 8 Scale Company would like to target the customers in the regional area only and t he print media is the best source for reaching the regional areas of that partic ular state.in. increase in the young population. Economic Survey 2007-08. Increase in level of literacy: Now the level of literacy also increases in India and due to that it is directly related to increase in revenue of the print media. increase in industrialization. and now the newspaper are also p roviding more information about stock exchange and people are also attracted to know about the stock market which also plays an important role in the increase o f print media and so print media is directly affected by the increase in level of literacy. forces may be directly or indirectly affecting working of the i ndustry. . because people are more int erested to know about things going around them.

Educational In stitutions had max.May 08.e.May 08 compared to same period in 2007. Tamil Nadu leads in advertising of Education sector in Print during Jan . Here we have mentioned all the top 10 sectors that spend m ore in print advertising.Revenue Drivers Generally most of the company depends on the revenue to grow further and to incr ease their business.May 08. if the company is not able to earn notable revenue at that time its future is under scanner.May 08. ‘Educational Institutions garnered a high share of 67% in Print during Jan . They are as given below: Top Sectors % Share Education 17% Services 12% Banking/Finance/Investment 10% Auto 7% Retail 5% Corporate/Brand Image 4% Durables 3% Personal Accessories 3% Telecom/Internet Service Providers 2% Personal Healthcare 2% (Source: Adex India (A Division of TAM Media Research)) Education Sector 14% rise in Print advertising of Education sector during Jan . share ( i. ‘Planman Consultant India Pvt Ltd was the number one advertiser of Education sector in Print during Jan . (Source: Adex India (A division of TAM Media Research)                       . In print media advertising the revenue drivers are the major sectors that spend in print advertising. 67%) of overall Education sector ad pie in Pri nt followed by Coaching Centre/Competitive Exam and Computer Education with 15% and 10% share respectively.

Tamil Nad u. 4 of the top 10 adverti sers in Services sector belonged to Travel & Tourism segment and 3 from Airli nes segment. Andhra Pradesh and Uttar Pradesh were the Top 3 states in advertising of Educ ation sector in Print. there is steady increase in number of advertisers of Education sector in Print. During Jan .e. Service Sector: Services sector includes categories like Properties/Real Estate. DTH Service Providers. Emaar MGF . Top 5 states accounted for 57% of overall Education secto r advertising in Print during Jan . Top 5 segments accounted for more than 75% share of overall Services sector Print advertising during 2007 . (Source: Adex India (A division of TAM Media Research) ‘Tata Sky’.May 08. 63% followed by Metro and Mini Metro Newspape rs with 24% and 13% share respectively. Vellor e Institute of Technology and SRM University were the top 3 key advertisers o f Education sector in Print during Jan . max.May 07. Opportunities Increasing readership                                                                                                                 . (Source: Adex India (A division of TAM Media Research) Top 10 Financial brands share aggregates to 14% of overall Financial Industry advertising share in Print during FY 2007-08. Internet /SMS s ervice. ‘Planman Consultant India Pvt Ltd . New Era Entertainment Network and Air India were the top 3 advertise rs in Services sector in Print during 2007. Advertising growth of 46% was registered under Computer Education in Print followed by BPO/Call Centers a nd Vocational Training Institute with 40% and 32% share respectively during Ja n . Public Issues of DLF . During 2007.May 08. Banking & Financial services segment had the largest share of 63% of Financial Industry in Print during FY 2007-08. Hospitals/Clinics. Banking/Finance/Investment: Print advertising of Financial Industry up by 10% during FY 2007-08 compared t o FY 2006-07. Reliance Power and Omaxe Ltd made it to the Top 10 brand list of Financi al Industry during FY 2007-08. During Jan .May 08.May 08 compared to Jan . Metro an d Non Metro Newspaper together accounted for 90% of overall Financial brands adv ertising during FY 2007-08. The top-10 list of new entrants in Services sector advertised in P rint comprised 6 brands of Properties/Real Estate and 3 from Internet/SMS ser vice segment. Non Metro Newspapers had the highest share of Print advert ising of Education sector i. etc. ‘SBI was the number one adve rtisers in Financial Industry advertising in Print during FY 2007-08.Among the Sub Categories of Education sector.May 08. Since 2004. ‘Hospital/Clinics and Travel & Tourism had close competition for the 2nd pos ition with 15% and 14% share respectively during 2007.

even globally the majority people are interested in reading hardcopy rather than the digital content in the all age groups. Geographical Expansion The leading players are expanding their geographic area in the country as seen i n the following table Publishing House New Edition Segment Region HT Media & BCCL (JV) MetroNow City-centric Daily Tabloid Delhi Ht Media (JV with WSJ) Mint Financial Daily Delhi. The fact that out of the359mn people in India who can read but do not currently read any publication. Bangalore Jagran Prakashan I-Next Bilingual Daily UP. Bangalore Times of India Economic Times (Gujarati) Regional Financial Daily Gujarat Times of India Bangalore Mirror Daily Tabloid Bangalore Jagran Prakashan City Plus Free English Infotainment Weekly Delhi/NCR. The expansion is also done world wide of Indian newspaper in which they are publ .8% witnessed a higher rise of 120bp during2006. i s that it boost up the advertising publishing in the print media. Mumbai Deccan Chronicle Financial Chronicle Financial Daily Hyderabad.9% to 71. This has led to significant scope for growth for newspaper publications in t erms of untapped potential readers. 68% can read Hindi indicates strong potential for readers hip growth. literacy levels in India have risen from 69. readership (dailies and magazines combined) increased to222mn from 216 mn. 20mn of these literate non-readers belong to the upscale SEC A and B segments (higher socio-economic brackets).The readership in print media in the newspaper and magazines sows favorable data for the advertising in newspaper and magazine. Literacy levels in urban areas at 85. Mumbai. Uttaranchal Business Standard Business Standard (Hindi) Regional Financial Daily Delhi. According to the survey majority respondents including male and female denies th at they will not read their favorite magazines or newspaper if it will be availa ble in digital form. Also. Chenn ai Source: PWC Waterhouse report Because of the geographical expansion done by the major players the reach of new spaper will also increase and the local as well as national advertiser will get the benefit of this expansion.3% witnessed a 90bprisewhereas rural areas at 64.1%. There is appositive impact in the newspaper and magazine advertising industry. Moreover. which can help publishers attr act strong advertising revenues. 45 % of any publications readers hip is in the urban area. This will have the good opportunity for the newspaper and m agazine advertising even globally Literacy levels According to NRS 2006. The above graph shows that.

etc. 2. List of overseas editions for many dailies 1. as a result any b ig player can have the opportunity to give the advertisement in full page and it can also increase the frequency of the advertisement.50% There is an increase in the demographic population shift because of this the con sumption of newspaper and magazine is also increased and the advertiser will hav e the opportunity to giving the advertisement in particular segment. Service Tax There is not any service tax is applied on the print ad space. The players of newspaper and magazines are also target ing the NRI population and publish the newspaper and magazine.20% Between 15-59 years Above 60 years 06. insurance. 4.10% 06.90% 2002 2007 30. during the traveling. at homes.g.000) 2 9 High Income (57.50% 56. the reach ne ss of newspaper and magazines will increase in the offices.000 9 Consuming class (23.000) Working class (10.000 – 57.000) 221 Needy (Below 10. 3.000 – 115.00% 59. Sandesh – weekly in Chicago ABP – Fortnghtly in US Malyalam and Madhyaman Manorama – daily in Dubai.200) 726 710 (Source: FICCI 20 17 33 48 74 285 404 613 PWC Research) 120 As there is a continuous increase in working class and needy class. Demographic Transformation Of India (In USD) POPULATION (MILLION) 2001-02 2005-06 2009-10(E) Rich (Above 115.200 – 23.30% 62. etc. The advertising targeting to the group of above 60 years age group like advertis ement of financial services. . Buhrain Gujarat Samchar – weekly in New York Divya Bhaskar – Fortnightly in Newyork Demographic expansion Population Demographic Age % of population Under 15 years 37. For e. The advertisement related to younger children could be shown in their supplement s like Bal Bhaskar issued by Divya Bhaskar. 5.30% 07.60% Shift 1997 33.ishing the advertisement.

60 (Rs 70) by the end of the year. pp. For example.00. 17 Almost all the leading dailies have their internet editions.00.000 28.92. E-Advertising.Threat Online Advertising Online advertising is a one type of digital form of print advertising.000 Advertising Express.000 70. The online banner ad spend per Internet user is only about $ 1.00. the young and educated segment ha s to be tapped.Many companies in In dia started online advertising to reach the public faster. Many dailies provide “e-paper” version with search opti ons like • Monetized by dailies like Hindu .000 2.00. August 2008. the adver tising spend on internet is also increasing at 32 % in 2007.00.06.20.00.000 1.00.20 (Rs 52. of Internet Users in India 14.000 7. The changeover has started and experts see a promising future fo r online advertising which is growing rapidly in India as the internet users inc reases. Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: No. a supp lement to traditional advertising.000 12.00. It is used by the a dvertisers to reach the NRI. which could be $ 1.50). as the following table shown.000 3. 17 Even the various sectors are also interested to do the advertisement online. Sectors % Spends Telecom 6 Financial Services 24 Technology 11 Travel 12 Automobile 11 Consumer Durables 9 FMCG 5 Online Services 11 Entertainment 7 Source: Advertising Express. August 2008. to promote admission to professi onal courses or for various competitive exams.it is in fact.65.25.00. E-Advertising.000 5.000 55.00. pp.00.

2. Corporate advertisers will p . Blogging on Internet As the different types of magazine target to the different audience.26. In the magazine the lead time is very high.611 different newspaper copies are circulated daily.91. 24. The advertisers h ave a great benefit for this. it will create a threat for the newspaper. For example the ads related t he beauty products will target the women’s magazines.4.000 • Out Look Business.16. So it will creat e the competition for the circulation of magazine and it will have an impact on the advertiser also.000 • Business India . because the frequency of the advertisement is high as compared to the newspaper. 38.000. The advertiser will go for the online advertising. the reach of newspaper and magazines are high. because they get the proper media vehicle for givi ng their advertisement to their targeted audience.2. The reach of print media in urban area is declining in was 46% in 2007 compare to 48% in 2006. The circula tion of • Business Today . This figure shows the negative trend to newspaper and magazine players 24*7 news channels on TV. 07. 8. including urban as well as rural area.000 • Business World – 2. According to the RNI there are 18.668 no of magazin es are available in different language in different region in India. so it might be not prefe rable for the industry players for giving the advertisement. As the numbers of news channels are increasing. Key Success Factors Reach ness: As compared to the other media vehicle.• Free access in the case if TOI and HT Declining reach in Urban For any newspaper or magazine the most powerful factor is its reach that how man y people read it in particular area or region. the bloggin g on the internet is also target to groups with equal interest. Advertisers have the different target segment according to their product need an d they can have the benefit of these high reach in of the magazines Preferred Segmentation The newspaper and magazines have their own different segments.

Advertising Express. etc. 2006. “Print continuing the growth streak”. pg 17 – 20. February 2008. “Advertising Industry Trends and Regulations”. Augus t 2008. Kruti Shah. pg 12 – 88. 2. IMPACT. “An overview of Indian media”. 8. February 2008. “Advertising Management”. Chandrashekhar and N Shridhar. Kruti Shah and Alan D’souza. 2. 5. A Sengupta and Noopur Agrawal. pg 64 – 6 6. pg 467 – 486. pg 670 – 674. February 2008. Prentice Hall of India Pvt Ltd. “ E – Advertising “. Anil Varma. job Portals. Advertising Express. 4. Oxford higher e ducatio. “Television Holding the ground’. Chepter-8 WEBSITE : . Pitch bureau. pg 70 – 74. 2008. pg 56 – 6 Jayshree Maji. 3. 2004. February 2008. Deepti Aggarwal.refer the Business magazines. “Online advertising”. “Outdoor Gaining from clutter”. The Times of India has launched the “Education Times” as additional supplement. Deepti Aggarwal. Pitch. pg 33. November 2008. Purva Panchal. MAGAZINE : 1. in w hich it has advertisement of all Educational Institution. February 2008. Economic survey 2007-08. pg 46 – 52. Pitch. 3. Pitch. Mcg raw Hill companies. Pitch. “Internet weaving a wider net”. 0. 7. Se ptember 2008. 6. “Advertising & Promotion an IMC perspective”. REPORT : 1. BIBLIOGRAPHY BOOKS : 1. Pitch. pg 12 – 18. Jaishri Jethwaney and Shruti Jain. “Radio More music to ears”. pg 78 – 82.

exchange4media.com www.com www.com www.angelbroking.com www.com www. 11.com www.economictimes.indiamart.indiatimes. www.Thompsonrouters. 2.com . 10.adindia.adex. 6.com www. 7.com www.ciiionline.com www.nic. 13.equitymaster. 5.com www. 8. 12.afaqs.com www. 3.tamindia. 9.pib.org www. 4.1.

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