The script is familiar. TOI enters a market, cuts prices, riles the incumbent and generally increases noise and spend levels. That is exactly what has been happening in Chennai since 2008. Last year, TOI ran an ad campaign poking fun at market leader The Hindu. Last month, The Hindu responded with an uncharacteristically aggressive ad campaign that essentially dubs TOI as a dumb paper.
There have been many discussions on online forums and within media circles about this ad war. There is the usual hand-rubbing and intellectual posturing that happens every time TOI enters a market. TOI is the flagship of the (estimated) Rs 5,000-crore Times Group, India’s largest and most aggressive media company.
The Hindu is owned by the Rs 935-crore Kasturi & Sons. It dominates not just Chennai, but it also has 17 editions across several cities, including Bangalore, Hyderabad and New Delhi. It is the third most read English newspaper in India, going by Indian Readership Survey (IRS) data, behind TOI and Hindustan Times. If The Hindu ever decided to, it could give TOI a serious run for its money, nationally. So this fight on its home turf promises to be interesting.
However, what it will achieve at the end of five or ten years is moot. A look at what happened after TOI entered Hyderabad, Kolkata and Bangalore in 1999-2000 might help.
The Statesman lost circulation in the battle between market leader The Telegraph and challenger TOI in Kolkata, even as the circulation of English newspapers expanded. The Telegraph still rules the Kolkata market, with TOI at number two.
In Hyderabad, the incumbent Deccan Chronicle fought back hard and actually increased its circulation — by four and a half times. TOI has less than half Deccan Chronicle’s circulation and is a distant number two.
In Bangalore, TOI has gone on to become the market leader, overtaking Deccan Herald.
In New Delhi, the most famous of all battlegrounds, after more than 15 years, TOI is neck and neck with Hindustan Times. It is almost 40,000 copies behind — but it is so clearly established that most local media plans have to include it.
Much of this suggests then that instead of one or two, readers start taking three or four newspapers and the market, ostensibly, expands.
But if you really look at readership and time spent in most markets, English newspapers don’t look so good. In the last six years, while the circulation of English newspapers has gone up by over 70 per cent, readership has crawled by just two per cent, going by Audit Bureau of Circulations data and the IRS. More importantly, the time spent reading English papers fell from about 46 minutes a day in 2006 to 43 minutes in 2011, says the IRS. It is not a big fall, but combined with crawling readership it is an indication that “stickiness” for newspapers is falling. Stickiness is a crucial metric if you are comparing newspapers to other media, say, television, radio or the internet. Most have seen some increase in the time spent, even as penetration continues to grow.
You could argue, of course, that the ad market has been expanding. The money advertisers spend on the print media (largely newspapers) rose from Rs 8,500 crore in 2006 to Rs 12,000 crore in 2011. While it is difficult to quantify, my guess would be that a large part of this growth is driven by regional-language newspapers. They, not English papers, have been the growth engine that has made India one of the most exciting print markets in the world.
Coming back to Chennai — sure, the advertising revenues will expand and so will circulation. TOI will probably end up becoming a second paper, and use it to drive national revenues.
But all the marketing noise only has entertainment value. The hard fact is slugfests burn a lot of cash to print copies that are not necessarily read. To really make a difference, newspapers have to be read by more people and for longer periods of time. And newspaper companies don’t seem to be able to come up with witty ideas on that, either offline or online.