Rahul Thappa, COO, Mail Today in a candid conversation with MxM India’s Akash Raha.
Q: For a long time you had been in Malaysia, how does it feel to come back to India and join the India Today Group?
Well, these are two different questions and I will take them separately. Coming back to India… I don’t think I ever had a big departure from India. Perhaps, there a few more cars on the road and lots of development since then, but the people are still familiar and the same. Moreover, I was in India fairly often even when I was working abroad, so coming back wasn’t a shock. As far as the rest of the family is concerned, and it was important decision for them too, they have been doing very good. Whereas joining India Today Group is concerned, I think it has been an excellent experience and a very good opportunity thus far. It is one of the best media houses and also one of the oldest. Usually in media, the oldest have the advantage of having settled down well and not being in a state of flux, like many new media organizations trying to find their DNA. So it’s been good on both accounts.
Q: What is change of tactic that you are adopting, since you have been on the other side of the business too – Media Planning?
How I characterize it is, I came from the demand side (for media) which would be the advertiser, advertising agency side of the business. And now, I have come to the supply side. I know how the demand side works. I know the psyche of the demand side and that helps me to understand on our end how our supply is to be sold to the demand side, what changes they may need to facilitate the exchange better etc. The knowledge helps us in building and positioning our product better in their mindset and in the way they conceive our product. Since, we all have an ad-revenue model it is essential know more about the demand side. If we were a subscription based model, it would, perhaps be not as essential. I think that is what I bring to the table apart from the fact that I have been in senior managerial roles for a while now which helps me shape an organization; you could call us (Mail Today) a start up considering that we have spent merely three and a half years in the industry. I hope my past experience will help shape our team further as we will have exciting times ahead. We bring a strong differentiated product in the market and it’s doing very well. I am not saying it will meet the main stream newspapers head-on, as it was never meant to. It might very well contest against the magazines. It was purposed differently and not to take on the big boys on, and our aim was never so. It might look like such a product, but our content is packaged very differently, unlike other newspapers. Hindustan Times and Times of India are everything for everyone. And anyone who wants to read an English newspaper can pick them up. They are fairly democratic that ways and the entry barrier for those who want to come in is low. They have something for everybody. However, we are not everything for everyone… Our content is curated and our content is for a certain demographic.  And in that demographic itself we have several focal points. SEC as we know it today is not as flat as it is… IRS in the coming years with developed and enhanced methodology will aptly point out the fact where they will have a more living standard measure gauge of SEC’s rather than educational and occupational parameters. So if I were to see SEC as a pyramid, which it rightly is, then we as a product, we cater to the top half of that pyramid. Hence, we will not go deep in the market, because we don’t intend to…We don’t intend to access that audience. By choice we have defined our own playing field and it is, in a way, a niche product. We have lower values in mass product and yet, we are a subscription based product. Since we are a subscription based model in time we will have the leeway or flexibility to depend less on ad revenue and focus more on subscription.
Q: So what are some of the changes that Mail Today has seen since you joined the group and what are some of the changes that the group is likely to see in future?
Change in management doesn’t mean change in the way how a company is run. There are only subtle changes where efficiencies are creamed out of each system. A person X will look in efficiencies in one place and a person Y will look at efficiencies at another. That is how they are made and that is how they think. But yes, since I have joined, I have looked for efficiencies in certain places… Given the state of economy currently, everyone is making sure across all boards that all processes are running smoothly and efficiently. But a change in management doesn’t change a way in which a newspaper works… the DNA of our product can’t be changed. As we learn about the market, consumers and demand side of the industry, if any process needs to be changed/improved then so be it.
Q: Efficiency since the slowdown has become an euphemism for job cuts, is that what you are hinting at?
No, job cuts happens when one process grows faster, builds up fat and then realizing that that process wasn’t necessary to begin with . But in a media industry all processes are equal and that is not what I am hinting at.
Q: Mail Today began as a paper for the newer audience – the office goers, to put more literally, the metro commuters. Being a ‘compact’ it is easier to handle and read? Are we right in understanding that this focus still continues?
No, our compact size had nothing to do with the ease at which it could be handled in tight situation, like the model Mid Day in Mumbai. At least, that was never the overt intention. However, if does mean that a person travelling in a metro finds it easier to read, then so be it. One can observe a trend that successful international newspaper are or have switched to compacts such as Daily Mail, Independent, Guardian… One, it is good for savings in terms of the newsprint cost on the other hand it is also fairly easy to read. Ease of reading, pleasing to the eye, logistical advantages, cost advantages… We think that the newspaper industry can take this (compact) route in the years to come. We have taken a bold decision first and we are proud of that. We have taken the first step towards taking compact forward this format that has been a trend internationally too. If people say only broadsheet is a serious daily then they are out of date… their size has got nothing to do with the seriousness of content. That’s just stereotyping. One cannot compartmentalize the products content by its size.
Q: Talking about content… Mail Today was known as the ‘Paper Tiger’.
Yes that focus still continues and will always continue because that is the belief on which media organizations are built. There is no ‘Madhyam Marg’ to it for us…which is what we call our competitors. They are large and fairly entrenched and they take the ‘Madhyam Marg’, or what we will call, being diplomatic. And we don’t believe in that. We tell a story straight, take the bull by the horns… several idioms come to my mind, but in essence we are very direct. We say what we mean and mean what we say, whatever be the consequences.
Q: Not too long ago Mail Today used to have their circulation number on the masthead. We see that it is not there anymore… Any specific reasons for this change?
We can put it back there… that is not a problem. But if it becomes two million and two hundred copies I can’t change it every day. It is a little tedious too and is nothing short of a live ticker. We started it only to tell that we were approaching a milestone and thereafter, that we have crossed it. Printing it every day will not make any difference to anybody’s mindset. Eventually, it will become a blind spot. We are currently at over two lakh copies and when we reach our next big milestone, we will put it up too. But keeping it up there permanently solves no purpose. It was for our detractors who said that we won’t grow. The market is growing and with it we are growing too. The market is not only growing only vertically but also horizontally… and there is enough space for us to grow in it. Everything is being diced up and segmentalized according to age, gender and so many other parameters. So the way media is going to grow is with more choice and there is going to be space for everybody; in fact, journalists will have far more trouble keeping their roots. But getting back to your point, the numbers were just to point out to the fact that we are alive and kicking and growing at a steady rate. In three and half half years, I think the numbers we have got in this cut-throat market is phenomenal.
Q: Since Mail Today was launched in 2007, it was said that expansion was on the cards. Especially Mumbai and Chandigarh were being talked about. Yet, the industry is still awaiting the expansion. Is it still on or has it been scrapped?
Hopefully you will hear of it soon, expansion has always on the cards. But expansion just for the sake of expansion, what you would have seen in several publications, is something we won’t like to do. We have seen several premiere media houses which saw splits, mergers, acquisitions expanding and trying to enter into every business, launching in every market that they can think off. And look where they are, look what the recession has done to them… Yes, money has become scarce; funding has become scarce too… There are companies in the market close to 80 and 150 years old and that’s why they are successful. We won’t take that long to be successful as they are, but we will get there. But we won’t ruin our work by trying too hard to get into newer markets. Delhi is our market and we know this market and stabilizing Delhi is of critical importance, which we have done. And very soon you will hear of us launching into major markets in a major way. We don’t want to be insignificant players in several markets. We won’t go into a market just because it’s large and growing… Big newspapers which are meant for all audience types can do that but not us. We are also looking for a certain/specific audience type; be it Bhopal, Cuttack or Port Blair. However, we already have a few marked city, the plans are at place and are being deliberated by the management. And very soon you will hear of our first foray out of Delhi.
Q: What is your annual revenue from Mail Today, and what is your revenue target for 2011-12 and what is the growth number it has seen?
Our readership is constantly growing. As far supply side, we are growing on that front too. As far as revenue side, we are growing at high double digits. Our growth over the last year is well into 40 per cent. For us, being a relatively new organization and having faced the slowdown, and yet being in the market with such a substantial growth figure is an even bigger achievement. Otherwise the way we started in 2007, we would have been growing currently at 60-70 per cent. We would love those times to come around but till then we are fairly happy with our growth rate.
Q: It is being said that the IRS-NRS merger are at hand. Do you think it will solve the measurement problem that the industry faces?
It won’t solve the measurement problem but it will certainly reduce the confusion. We will have one metric to go by and it will make it easy to everybody to look for improvements. When there are two measurements, it’s like having a pound and metric systems working together. The merger won’t solve the endemic problems immediately that publications may have but it will benefit if everyone focuses on one metric. For example, the simplest thing is when you go to a client or planner or agency you might find one of them focusing on one set of data and another one on the other. You waste a lot of productive time that way, which we can now do away with. Two sets of money which was used in setting up samples can now be used to set up double the samples, hence more robust data.
Q: What are your digital plans? Â We have seen your epaper on the digital space but do you have a plan to do more on the digital space and monetize it with advertising revenue, and perhaps subscription revenue through partial pay walls etc.
We realize that the digital era is already here, yet, none of the Indian players have been able to do anything substantial on it. But I can’t hide behind and say since it’s not working and we will not go there. Digital has become a way of life, information is dynamic and people want information at any time and at any place. When the demand will increase, so will the entire market and then, people will have many models. For example, if you have a complete pay wall it might not work, yet, if you have a partial pay wall it might just work. Also, you can focus on advertising and give content for free. Ad rates, as we see today differ for a digital pixel and a print pixel, which is not right. It is a peculiarity of mindset and it has to change. In years to come, digital will reign. Yet as I say that, I believe that physical product will co-exist. In 20 -25 years when today’s generation consuming digital grow older and new generation of people consuming arrive, print might see a little fall, yet it will co-exsist and then better product will reign. Mobile, tabs and more futuristic system will come into existence and then the sole factor will be how you reach out to a consumer throughout his day on various mediums. Answering your question, eminently, we have been a little slow on that front (going digital) because we are just a start up and we wanted our editorial to focus on the paper product first and we wanted to keep it growing. The demand side still understands print better and hence it was understandable to keep that going before we jump into anything new. We are already making plans to go digital… But we want to come up with something different… Not something regular and utility base like the other Indian websites we have today. The idea will be to be a Huffington Post equivalent, otherwise, the content and the medium will not be differentiated. For example, god-forbid, if there is a bomb-blast everyone in a matter of 10 minutes will have the news. Hence, time is not a differentiator in that space because everyone has caught up and is as fast. Wealth, is the second dimension (one could be paid, one is not) yet, there is yet to be a successful model in it. Lastly it is skill, which is where one can differentiate. A well curated news and content is important. How does an event affect a person’s life and how you add value to it, which is the skill dimension… Currently at number two, Mail Today, our parent in the UK are competing on time and content. They have most of the news and on time too… You have to see it to believe it, how they put content together, on time and seamlessly where the designing is superb.
Q: It is interesting how you say Daily Mail is your parent, I was more expecting a term like partner.
Yeah, they are our parent as far as the website is concerned. And then again, I could say that we have two parents, one is Daily Mail and the other is India Today group, which undoubtedly is a parent. If you see the mast head (of Mail today), one can say that they are similar. We borrow a lot from them. Our DNA in terms of look, feel and the physical self of the paper is from Daily Mail. The way the content is put together is an India Today DNA.
Q: What is the interaction level of Daily Mail with Mail Today after three years?
We are very interactive. In content sharing of course we are the equity partners. Apart from that, they provide us the glimpse into the future and whole lot of other learning, as to how to handle multi-national clients. They have been handling the same format for a longer duration of time than us, hence the expertise. Our relationship is a fairly active and very cohesive.
Q: Do you think that media houses should do something to change the current overdependence on advertisement revenues? Do you think rationalizing cover prices will help? What are the challenges?
Yes they should. The biggest challenge is, the fear that if prices are hiked circulation will be affected. For example, there are houses where there are 4-5 a paper going in each day and the fear is with a hike in price they might cut down on 1-2 paper. But I don’t really see it as fear, rather it is a affirmation of two things –How valuable your product was in that person’s life if he can do away with it? On the other hand if that person was so price elastic that he couldn’t pay another two rupees for valuable information he or she is buying the first thing in the morning, it creates serious doubts over the buyability of the reader as a valuable asset to an advertiser. For certain advertisers selling regular day to day stuff it will be bad. But for an advertiser selling a car, it becomes interesting… Let’s say my circulation is one million. If all products become double the price, the people who drop out are for instance 300 thousand. In that case, I would value that 700,000 more than the entire 1 million. Now that 700,000 I have are taking me no matter what the cost, they are actually reading the product and see value in it. The other 300 million weren’t reading me and taking me only because I was cheap.
My argument to the advertiser would be, as it is earlier only 700 thousand were reading the product. And hence you continue paying me as much as you were, since that’s the exact number I still have. Then, my cost comes down and my revenue stays stable and I am a little more profitable. Some of these costs can be shared with the advertisers like they will want you to, but there are other ways of doing that; by elongating their campaigns, making content for them, doing events etc., not by giving them a price off. The aims should not be to talk to everyone, but to talk to fewer people and be sharper in the communication.  It is time we bite the bullet, it is time we increase our price and it is time we do something rational for ourselves rather than keep digging ourselves deeper in the pit. If two rupees a day can bring down the edifices of large organizations then it is a slap on their face. If the whole network of large newspapers is built on Rs 2 a copy then there is no point discussing their value anyway. It speaks a lot about what you have built over the past so many years. If you have built content-based credible organizations then the consumers will read you irrespective of a Rs 2-3 price hike. It can’t do away with what I call ‘Elasticity of Doom’. ‘Elasticity of Doom’ will come irrespective of the money – Sorry, you didn’t build a strong enough organization. You can very well increase 50 paise every month for four month. Then people in the industry say that do it all together, how would it make a difference, what is the point of doing it slowly. But like one of my colleagues in Mindshare used to say, you don’t boil a frog by putting it in hot water, it jumps out. You heat it slowly, and sooner or later you can boil the frog and make a nice broth. And all publishers can do it together, 1st of every quarter, across all boards. So that one is not costlier than the other and the parity stays. So it’s possible, you just need will to do it, because the ‘Elasticity of Doom’ eventually is inevitable. The cost of paper has to rise up, it’s not a renewal source, so might as well do it right now. Especially in the paper industry there is no reverse logistic. So till reverse logistics become a part and parcel of life, you will never have cheap recycling and cheap paper. Most of the paper today gets imported and there are tariffs, company disputes etc., due to which prices will always keep rising.
Q: Talking about lighter subjects, Mail Today comes up with interesting initiatives. What are some of the upcoming marketing initiatives that the paper has planned?
We have planned a lot of initiatives. But unfortunately we can’t talk much about it as it is a revenue stream for us. Olympics, Delhi centenary year we plan to do a lot on a lot of topics. Delhi has its own problems and being Delhi’s own paper we will try to tackle it in the best way possible. You will see several campaigns in times to come.
Q: On a broader note, what are the new emerging trends in print media?
There are wiser people who can talk about trends, but there is one trend that I will talk about which is the rise of tablets. I think it’s at our doorstep right now. While it might seem very quiet… you see cheap tablets of Reliance, Beetel. Samsung too have been known to lower costs drastically. The ipad market, I feel, will grow faster than the penetration of smart phones. There is still very little Indian content on the ipad. Yes the Times of India has an ipad app and a few others too, which is good and evolving, but it is not seamless yet. It is nothing like the foreignpolicy.com apps. We were talking about consuming content at ease in a metro. Consider the iPad which collapses a newspaper to one-eighth its size. You don’t have to open it any more, you can just slide your way through the complete newspaper. There are already about 250 thousand iPads in the country by official or unofficial estimate. Every second member in our industry has an iPad. It’s just a matter of time before the market explodes, and when it does, it will be everywhere without anyone having to curate content for it. That is something we should all keep our eyes on.
Q: Can we expect Mail Today to come out with an iPad app soon?
Mail Today would certainly like to do it; but probably as an organization we don’t think we ‘need’ to do it right now. But we have our eyes pinned on it, and will offer a value package to our consumers if and when we think it is the right time.
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