Demonetisation impact: Media grapples with layoffs, lesser ads

The ban on high-value notes a month earlier has left the country's media market in duress as advertisers slash budgets in the wake of the cash crunch.

ABP Group, publisher of The Telegraph and Ananda Bazaar Pratika, has reduced the pages of its publications and intimated departmental heads of a decision to reduce staff, persons in the know have told Business Standard. In Ananda Bazaar Patrika, their Bengali daily, pages have been reduced by almost six.

Parallely, the ABP Group is making a voluntary retirement offer to employees under the Wage Board. About 25-30 people are expected to be affected, it is learnt. The group brings out a total of 11 publications and has also brought down the retirement age of employees to 58 from 60 years, letting go of 45 people in the process.

When asked the group's managing director, D D Purkayastha, declined to comment on the issue.

A hint of the way ahead for media groups after demonetisation was given by Vineet Jain, managing director of Bennett, Coleman & Company, publisher of The Times of India, among others. 

In a recent tweet, he highlighted about the impact of demonetisation not being only short-term: "Impact of demonetisation - consumer spend??company/retail sales??real estate??ads??gdp??profits??salary cuts expected??economy?? #NarendraModi."

Demonetisation, for the record, has seen ad inventory levels come down by at least 15-20% across all media — print, television, radio, and outdoor, according to sector sources. In the days immediately after the announcement, the drop across media was as much as 50%, they say.

While the national media has since bounced back, regional media — TV channels, radio stations and newspapers — have suffered, says Jwalant Swaroop, former chief executive of Sakal Media Group, now an independent media analyst. "The urban centres are at least getting some cash. The semi-urban and rural areas are hardly getting any. So, local advertisers barely have the money to splurge on visibility. This impacts local and regional media," he says.

In outdoor advertising, Mumbai and Delhi are seeing blank billboards, though the ongoing December quarter is considered a peak period for advertising. An estimated 35-40% of all advertising happens in this quarter, across media.

The reason for the pullback in outdoor spending is depressed sales in categories such as retailing, real estate, and jewellery. Alok Jalan, managing director, Laqshya Media, says: "Even segments such as handsets, telecom and TV channels are not advertising heavily following demonetisation, resulting in empty hoardings."