INMA, or the International News Media Association, hosted its South Asia conference on November 18 and 19 in NCR on the theme: 'Not just an ordinary disruption’.
DD Purkayastha, MD and CEO, ABP, and president of the INMA South Asia, touched upon disruption in the digital era and in distribution. He urged newspapers to keep investing in journalism, because 'except for that backbone, we do not have any competitive advantage'.
Dr Bhaskar Das, conference moderator and group CEO, Zee Media, noted that a media organisation could face disruption by reinventing itself, balancing stability and agility.
‘Winner takes it all’
The case of Apple’s dominance took stage at this forum too. Shubhajit Sen, CMO, Micromax India, explained that while Apple has 14 per cent market share, it earned 95 per cent of the industry’s profit globally last quarter. ‘Winner takes it all’, with no place or a second or third player.
On how Micromax is living up to its core philosophy of 'disrupt to grow', Sen said the company is investing hugely in R&D to come up with differentiated and innovative products. Micromax also has various brand ambassadors, so that they (consumers) never get fixed on one thought, he explained. The brand is also constantly working on its supply chain to keep it agile, informed Sen. He further revealed that the company launched YU to break the momentum of Xiaomi's online sales.
Asked by the moderator Dr Das about Micromax using print for breaking campaigns, Sen responded in jest that it used print media to create more 'hawa', which is aimed more at competitor and distributors.
He added, "We tend to oversell how much measurabillity digital (medium) has. There is a still a bit of gap when it comes to sales. TV is still best for building brand equity, newspaper to drive urgency and digital helps us when the consumer is in active search mode."
‘Invest in adjacenies’
Neeraj Aggarwal, MD, Boston Consulting Group, South Asia drew attention to how print is facing ‘grade four tsunami’ and will ‘morph into something very interesting’ in five to 10 years. He presented four trends impacting newspaper businesses – increase on time spent online, away from print; exponential growth in new devices; fragmented audience; and new voices from various sources.
Underlining that the need for content was higher than everthe speaker urged newspaper companies to invest in 'adjacenies' – new, related businesses leveraging core assets. He cited the example of Meredith Group's Better Home and Garden, which has now morphed into a content ecosystem across books, real estate, TV, internet and events.
Drawing from successful cases of companies who faced disruption, and have emerged winners, Aggarwal listed three points: fund the journey by making the performing core business more agile to create more cash; win in the medium term; and build right team structure, culture and processes.
He concluded saying, "Fundamental transformation is required for sustenance in disrupted new world."
Leverage the challenge to advantages
A news media CEO panel featuring Pawan Agarwal, deputy MD, Bhaskar Group; Sanjay Gupta, CEO and editor-in-chief, Jagran Prakashan; Raj Jain, CEO, BCCL; DD Purkayastha, MD and CEO, ABP; and Rajiv Verma, CEO, HT Media spoke about the opportunity that disruption brings with it.
Gupta pointed out that disruption was a complementary force, and that all media platforms in India were thriving. Jain noted that focus to create content and make it relevant remained, irrespective of the medium. Purkayastha disclosed ABP’s mobile-first approach in all its processes.
On the business model undergoing change due to disruption, Verma of HT said that for newspapers, advertising remained a necessary part of the mix to attract eyeballs. He added, "And the only way to overcome challenge is override it with innovative products."
For larger organizations, competencies don't migrate as easily, he observed.
Bhaskar Group’s Agarwal urged newspaper companies to create products keeping in mind the age of readers. Purkayastha admitted that ABP had never customised its products, but is learning now. "We are using a lot of data and analytics to understand the readers," he said.
Jain of BCCL predicted growth of the overall advertising pie with digital, while foretelling the death of banner advertising .
‘Stop using digital as marketing tool’
Suresh Balakrishna, CEO, Initiative-BPN; Sanjeev Handa, VP – marketing, Maruti Suzuki India: Sandip Tarkas, president – customer strategy, Future Group; and Harpreet Singh Tibb, director – marketing, India and South Asia, Kellogg India, discussed how digital as an advertising medium is being leveraged in India.
Handa confessed that while digital was in focus at Maruti Suzuki, they were still trying to understand the medium. Maruti Suzuki's digital spends are in the range of 5 to 6 per cent of total ad spends, he informed.
Tibb said, "Earlier, advertising was about interruption. Now it's about interaction, involvement and creating content to trigger it." Kellogg, he revealed, has created 100 online-only videos to target consumers
Tibb said that while the company earmarks 14 to 15 per cent of advertising budgets towards digital, it is pushing the envelope to market in the digital era.
Tarkas noted that Future Group's digital spends were less than five per cent even as every business process in the organisation was getting impacted by digital era.
Balakrishna revealed that the top 50 advertisers in India spend only 10 per cent of their advertising budgets on digital. Audiences need to be charged for digital content, he contended, adding that that the economies of publication businesses would then change.
The panel concurred that for print media to be more attractive to advertisers, the medium needs to be more innovative and create newer formats; partner with clients to create larger ecosystem; print must adopt internet and should monetise its content.
Two ends of the rope: legacy and digital
As legacy publishers embrace next-generation data analytics and the digital media players understand the importance of quality editorial environments to attract advertisers, the two ends of a rope are burning toward each other, noted Earl J. Wilkinson, executive director and CEO, INMA.
Wilkinson highlighted that legacy news media companies have print and digital synergies, good cash flow. good profit and low capital. Digital companies, however, according to him: have been supported by venture capitalists, have bad profits and high capital, their decisions are drawn by analytics, they disrupt legacy media and they have a ‘medium-quality’ editorial environment.
He said that while it remains to be seen where the two ends will meet, 'there is a focus on less big data and more smarter data’. Sharing his outlook on what fast lane is starting to look like, he stated: "Programmatic publishing of personalised content and nano segmentation to grow lifetime value of consumer."
For the legacy newspaper companies to compete in digital era, Wilkinson said the priority should be: diversify revenue beyond print and digital; compete in programmatic advertising environment; and leverage data to grow audiences and revenues.
In the concluding session of INMA's South Asia conference, Dr Das surmised the pointers to stay ahead of the curve during disruptions. He said: "Consult your truth-tellers who are 'wrong' people; choose the perfect moment, which is now, to enter digital ecosystem; experiment and collaborate; be ready to scale up in months if not in weeks; capture 'winner takes it all' markets; anticipate saturation; shed assets before they become liabilities; quit when you are ahead; adopt new technology and ideas; and when nothing happens, open incubation centres to complement core businesses."