Tag: IMC 2013

By A Correspondent

 

Presenting a case study on ‘What India Can Learn From The World’ on the second day of the Indian Magazine Congress, Stefan Gneuss, COO of Gruner + Jahr International, said e-commerce is one key way for brands to meet the digital challenge. Paid offerings and paid content is most important, he said, as a means to give readers value added content, services and products.

 

Media consumption is inevitably shifting to digital, Mr Gneuss said, and print is shrinking. He observed that the erosion of print had first happened in the 1980s, when print consumption dropped due to television. It has happened again from the late 1990s, with the advent of digital. The most important trend is social media, which brands cannot afford to take lightly. He said brands should be active on social networks, and should offer more to the user leveraging on the strengths of the medium. “Offer videos as an advertising format, for example,” he advised, citing figures to show that time spent on online video consumption is on the rise. Similarly, mobile content should be offered for mobile consumers. E-commerce should be utilized from lead generation to the full-value chain.

 

Moreover, as users become even more involved with the content they consume, brands must go with the trend and use social networks to create communities of interest and encourage user-generated content. “Own your segment,” he said, giving the example of brands in Europe which do this.

 

Learnings

Mr Gneuss highlighted takeaways from the changing publishing scenario.

– Decreasing ad spends in the magazine business are a given.

– Cost discipline is necessary for sustainable profitable business.

– Brands must identify key assets for digital.

– Develop additional business models.

– Anticipate the consequences of mobile.

 

5 theses for India

– Your brands are king.

– Work on costs and overflows for a sustainable profitable business.

– Develop towards being a multi-channel content provider with technology as the basis.

– ‘Online first’ was yesterday’s priority. Today, it is ‘mobile first’.

– Attract talent. You can only survive if you have the best people on board.

 

By A Correspondent

 

In an atmosphere where the explosion of digital media is leading to questions about the relevance of magazines, Madison World Chairman and Managing Director Sam Balsara put forth what was probably the defining argument, when he summarized the question of magazines and their ROI.

 

Leading the panel discussion on the second day of the Indian Magazine Congress, on ROI from Magazine Media, Mr Balsara said there was good news as well as bad. Underlining the continuing importance of magazines, he cited a Henley Centre study which found that nine basic needs are fulfilled by media, and magazines as a class, irrespective of genre, fulfilled most of these needs.

 

The nine needs are split into two main classes: informational needs and cultural needs.

 

Information needs:

• Instrumental: information for daily life such as weather, transport, traffic, sales, opening and closing times, etc.
• Analysis: to understand the world, form views, have opinions.
• Enlightenment: keeping up with the world, national and local events; being and becoming informed.
• Self-enhancement: bettering ourselves, knowledge for its own sake or for later application; acquisition of skills.

 

 

 

 

Cultural needs:

• Ritual: media use which frames daily routines, such as getting up, going to work, relaxing after work, accompanying domestic chores.
• Default: absorbing media because it is there or because others within the social context are using it.
• Relaxation: passive absorption of media, unwinding.
• Entertainment: keeping ourselves amused, keeping others amused, having fun.
• Escapism: frees the user mentally from the immediate constraints and/or dullness of daily life, enabling him/her to enter into new experiences vicariously.

 

 

 

 

 

This wide range of needs creates a demand which magazines can meet because there is such a variety of them.

 

Mr Balsara said that the other piece of good news is segmentation, which is sharper in magazines. This means good news for planners, as it means less waste, and they can target specific groups due to the proliferation of niche and special-interest magazines.

 

The third piece of good news, Mr Balsara said, is that magazines have a longer half life than most other media. This means a longer lingering effect for advertisers, in sharp contrast to television which, although it did a good job of demolishing magazines in the 1980s, has a low half life.

 

Moreover, from an engagement point of view reading magazines is an active activity, compared to something like watching TV which is passive. Therefore, intuitively, a combination of TV and magazines should be a potent medium for many brand plans, Mr Balsara said.

 

TV advertising also becomes more effective when advertisers also spend on magazines, Mr Balsara said, highlighting that overlap scheduling doubles the impact. Though TV overwhelmed magazines in the 80s, the fact is that the effectiveness of TV comes down as the level of clutter increases.

 

Multi-media is indeed ROI-accretive, Mr Balsara said, and those brand plans which use more than two or three channels of communication have an overall higher level of effectiveness. Multi-channel campaigns are more effective across the board than single-channel activity, he added.

 

On the downside, however, is the fact that magazines contribute to just 4 percent of the total advertising pie, he said, and this is lower than the global average.  Plus, he observed that though literacy in India is going up, and this helps newspaper readership, it does not seem to be benefiting magazines. On the other hand, he said, though small, there is an increasing use of magazines online which, though not robust, is growing.

 

Making some suggestions, Mr Balsara said that the Association of Indian Magazines should conduct studies on the impact of multi-media on different categories, to check accretive ROI. The next few years, there is going to be a strong movement for multi-media, specially from big brands. To meet the need for another medium in addition to television, magazines should be ready, he said. AIM, he said, should also develop case studies on the impact of use of magazine advertising on sales/purchase intent. His third suggestion was that magazines should exploit their content creation capabilities to open up new areas of growth.

 

CVL Srinivas, CEO South Asia, GroupM, said that publishers and sellers needed to look at leveraging all the good news to convert it into revenues. Magazines are the best medium for building engagement, and score high on the trust factor, but this has not been translating into revenues, he said.

 

A change of mindset is required from publishers and sellers, he said; the latter need to stop selling ads and start selling engagement. Magazines can form an engagement layer over media like television which are heavy on exposure. Moreover, a lot more relevant research is required; for example, what is the interplay between magazine consumption in different formats? More category-specific research is required, he said.

 

Most important, magazines have to gear up to ride the digital wave, said Mr Srinivas, and had to move from being passive to becoming active communities, using digital interaction to its full advantage.

 

Ambika Srivastava, Chairperson, Zenith OptiMedia and Vivaki Exchange, said that the role of advocacy and recommendation is very big. It is clear that consumers value the content of magazines, and the role of magazines in guiding the consumer to a purchase needs to be measured. Advertisers need to look at content very carefully, she said, to go beyond the traditional formats and think about dynamic engagement.

 

 

 

Ashish Bhasin, Chairman India and CEO South East Asia, Aegis Group, said research had shown the highest level of engagement in any advertising is in magazines. But the conundrum is that revenue is not coming in at a commensurate level, and this needs to be addressed. Magazine spending had grown at a rate equal to or less than the overall ad pie when it should have grown more, he said.

 

Magazines need to change the selling game, he said, and instead of focusing on figures and statistics, marketers need to sell engagement. Engagement is not being measured and is not being given the credit it deserves.

 

He also said that magazines are the masters of innovation, and need to capitalize on this advantage. Technology is the friend of the marketer in this respect, and innovation and engagement naturally lie in magazines. Innovation is what will change the dynamics of the game, he said.

 

Finally, considering that magazines have only 4 percent of the ad pie, individual titles need to practice coopetition, and need to get together to fight for the medium as a whole, instead of cutting each other down. Instead of fighting for the same dollar, coopetition can increase the number of dollars we are fighting for, Mr Bhasin said.

 

The discussion was moderated by Worldwide Media CEO Tarun Rai.

 

By A Correspondent

 

Before sharing his experiences and know-how on the global state of the magazine industry, Peter A Kreisky, Chairman, Kreisky Media Consultancy preferred to begin by sounding an alert by announcing that the largest read publishing group Time Inc had been brought over by a relatively smaller player Meredith Corporation in the US. “This tells us what the future will unfold for the print marketplace especially with digital playing a key role in the transformation.”

 

Stating that the print industry in the USA was around 3-5 years ahead of India, Mr Kreisky through his presentation on ‘Towards the new business model’ highlighted some hard facts surrounding the magazine industry. Backing up his claims through numbers, he pointed out that in 2007-09 the US magazine market witnessed a 35 per cent drop in number of ad pages, which was felt the most by news magazines that saw a decline of almost 65 per cent while newspapers were next reporting a decline of about 60 per cent. “This was the time when the industry as a whole was in a state of crisis but there was a remarkable turnaround that happened from June to September 2010 where top publishers went about hiring new leaders to run the reigns for companies. The thing about these leaders was that they were a younger lot than their predecessors and who were ready to take the plunge where future-readiness was concerned.”

 

Admitting that the use of print/paper was on the decline, he said that the industry was in a state of vortex that was compounded with issues like extended recession, structural change in ad spends, rise of sophisticated mobile devices, decline in newsstand sales, evolution of powerful digital gatekeepers, etc. But based on the change that was being witnessed, according to Mr Kreisky the three facets that were core to the business were a trusted magazine brand, curated & valued content, and engaged communities.

 

Mr Kreisky went on to present five new rules for Magazine Media that comprised the following: a) B2C model – from print publishers to being magazines everywhere, b) Portfolio model – From bigger is better to owning customer communities, c) Strategic control – multi-title aggregation to harnessing digital gatekeeper, d) Customer revenue – circulation dollars to branded commerce and e) B2B revenue – from ad sales to marketing sales.

 

As for the first rule of B2C, Mr Kreisky highlighted that publishers need to move from being print-centric to brand-centric. He cited the example of the Meredith Publishing group that was the first player to adopt the ‘magazines everywhere’ approach. “Today the multi-platform strategies have evolved from porting the same print content to a clearly-defined role where content strategy and business models have gained much prominence.” Today, consumers are at a stage where they need to subscribe only once and they get access to all digital content unlimited, added Mr Kreisky.

 

Next, Mr Kreisky went on to question the gathering on whether their brand was indispensable for an identifiable community. He cited the examples of brands such as ESPN, The Economist, Dwell, Bloomberg etc and suggested that the publishers had to make a choice whether their digital magazines would be a container or a connector where the role of containers would be to delegate editorial-aggregated content while connectors would be about bringing clusters of people together around well-defined interests.

 

On the topic of harnessing digital gatekeepers, Mr Kreisky stated the examples of tech brands like Apple, Facebook, Twitter, Microsoft etc who were playing a huge role in being gatekeepers while also providing a scope to act as collaborators. He shared an important quote with the gathering as he said: “It’s become very clear that digital trumps print and that pure digital without any legacy costs massively trumps print.”

 

On the next rule of circulation dollars to branded commerce, Mr Kreisky said that where paid content was concerned, avenues such as events, e-commerce, membership schemes etc would do well going forward. “Paid content models can peacefully co-exist with free models if they are clearly differentiated,” reasoned Mr Kreisky. As for the emergence of e-commerce as a model, Kresiky went on to present the example of Shop Bazaar that was leveraging its digital presence well by advertising and selling products only advertised in magazines. That provided the publishers a good revenue model and also enabled them t provide only exclusive stuff to their customers.

 

 

 

By A Correspondent

 

The 7th edition of the Indian Magazine Congress lived up to its reputation of being a landmark event. The wait was worth it as stakeholders, marketers, industry captains and foreign dignitaries made their way to the venue at ITC Hotels for the start of procedural sessions, and the IMC 2013 kicked off with an inaugural address by the CEO of one of India’s hottest brands.

 

Nitin Paranjpe, CEO & MD, HUL told a packed gathering about the need to do away with the old and be custodians of change for the betterment of the business. This, he reasoned, was possible only if one were to inculcate a reality that’s now become an indispensible part of the way we do business – namely digital.

 

Cautioning the audience, especially advertisers, on the trends prevailing in the Indian marketplace, Mr Paranjpe said that the industry was seeing a tectonic shift in the television viewing habits of consumers today. “With an array of alternative streams available to communicate with the consumer, advertisers will find it challenging in the way they want to communicate with consumers,” he said.

 

In a hard-hitting statement, Mr Paranjpe said that the 30-second commercial will no longer be as effective a form of advertising given that the consumer has an array of options before him to access content. Even media agencies and also media owners in some sense will have no say in telling consumers what to watch or not, he cautioned. “The issue today is that is that we are in a pretentious mode or are rather not willing to confront this reality. The sooner we wake up to this reality and stop pretending to not know the better prepared we will be for tomorrow. The core is: if digital is going to play a huge role going forward then we need to do things to help us stay relevant.”

 

Advocating a way forward for the business community, Mr Paranjpe added that the topmost priority for most business houses will be digital capability and finding new business opportunities. “AT HUL, we have taken a huge first step towards familiarising our employees with the opportunities that arise from digital and are spending significant amount of time and money in training them to be future-ready.”

 

In order to facilitate a smooth transition into the future that will largely digital, Mr Paranjpe disclosed that it will be essential for owners to ink tie-ups with specialists who can offer skill-sets in a manner befitting to the business. “We have to be realize that transformation and change need different forms of commitment and we have to be ready to facilitate that. I am not so much worried that we are still not doing enough for the business but what gives me sleepless nights is to see rapid changes transpire around us every single day, especially from digital.”

 

Imploring business heads to rethink strategy, Mr Paranjpe said that that to be future-ready businesses will have to bring about a change in the business model. “A recent finding that I came across revealed that where the trust quotient was concerned, business houses and politicians were competing in the last rung. It is surprising but true that we are still not trust-worthy to be seen as beacons of change for our consumers. The thing is that we are judged by the outside world as having a self-serving attitude; this needs to change,” affirmed Mr Paranjpe.

 

Sharing with the gathering another reality, Mr Paranjpe said that the truth is that we were forced by the government to include CSR as a mandatory practice but had we self-regulated ourselves earlier to this reality we wouldn’t have required an external source to impose guidelines for us. “What can be inferred is that the model of doing business tomorrow cannot be what we are doing today. This will be the mother of all changes.”

 

On the implications that digital has brought about in the marketplace, Mr Paranjpe shared his own organisation’s example as he said: “Two years ago the decision that we took to make our employees digital-savvy was met with some scepticism but we’ve learnt a lot along the way and are better prepared to be agents of change of tomorrow. What is required is to have in place a mechanism to be future-ready. We are used to the mentality of ‘easier wrongs and harder rights’ but we will have to keep working on building our talent and skill sets.”

 

Signing off, Mr Paranjpe said that it was important to see what would be the implications of these decisions on the revenue models of business firms. “At the end, that is what matters to every organisation. But then the good thing is that change offers opportunity. If we are change-ready we could achieve a lot more in 3-5 years than double that time it may have taken us to reach our goal.”

 

Prior to Nitin Paranjpe’s keynote address, Association of Indian Magazines President Tarun Rai welcomed the delegates as he shared a few inspirational experiences confronting the magazine industry in India. Admitting that digital will drive the future for the industry, Mr Rai asserted, “The pace of change in technology has been humongous. This change has been a good thing to have happened for magazines especially with the launch of tablets about two years ago. It has been a huge area of opportunity for magazines as now magazine content can flow nicely onto the digital screens. The way the digital magazine market has been growing has been huge in India. Digital has been provided us a new revenue opportunity and a new reader reach to magazines and its content.”

 

Elaborating, he said, “As India’s digital market is growing the way the market is growing and people’s aspirations are growing faster than the economy, and their disposable incomes there is going to be need for more magazines catering to the niche and lifestyle segment. Even in the traditional format, magazines are going to grow rapidly. Coupled with that is the added opportunity that comes from digital. This is the most exciting time to be in the magazine publishing business.”

 

The challenge for the business, Mr Rai said, is that there is a need to develop skill sets pretty quickly. “The learning curve has to be very steep and short because the editorial team led by the editor has to repurpose content. One just cannot go from a magazine to another platform in a simplistic way. Also, the ad sales has have to be able to monetize these platforms with advertisers. Right now, I do not think that in any parts of the developed world the right models of advertising monetization have happened on the digital devices.” Addressing another challenge, he said, “The third challenge is for the marketing team to be able to utilize the opportunity of the multi-platform brand that we have created. Earlier this opportunity was available only to an event. But all that has changed with digital gaining prominence over the past few years. Finally publishers have to make sure that there is a business model; you do not want a situation where resources are being diverted into multi-platform at the cost of printed magazines. We have to make sure that it makes business sense as well.

 

“The good news is that it is finally a good time to be in the magazine business,” averred Mr Rai.