This was something most analysts watching the print media scenario had predicted.
And now it has happened. With the issue dated September 2, India Today, the general interest English weekly from the Living Media stable, has increased its cover price to Rs 15, up from Rs 10. While most planners and competition were ready to speculate on what led to this move, Sanjay Malik, associate publisher of India Today, was unavailable for comment.
Media analysts ascribe the reason to a downturn in the advertising revenue. This has made magazines across the board sit up and rework their strategies with fresh gusto. India Today's closest competitor Outlook took the first plunge in April and increased its cover price by Rs 5. It also revised its rate card, increasing its advertising rates by 18 per cent this year (April 1, 2002), compared to last year's (2001-2002) 14 per cent. India Today has reportedly revised its rate upwards - by 10 per cent.
Now that both the English weeklies are on par - at least in terms of price - what is going to be the real differentiator? "Let me tell you, price has never been the issue. We have never pitched Outlook on that platform. It has always been content and we have always been the trendsetters. Typically, India Today has been following suit, be it the periodicity or the price," says R Rajmohan, vice-president, Outlook.
What probably explains Rajmohan's confidence is Outlook's growth rate, which is much faster than India Today. When Outlook was launched in 1995, the circulation of India Today stood at 4 lakh. Seven years on it is 4.4 lakh (source: ABC July- December 2001). In these seven years, Outlook has grown to command a circulation base of 2.4 lakh (source: ABC July- December 2001). For the same period, while India Today's readership has grown from close to 50 lakh (NRS 1995) to 57 lakh (NRS 2002), Outlook has grown from zilch to 15.7 lakh readers (NRS 2002). Nonetheless, Outlook's desire to catch up with India Today may yet be a tough call.
For India Today, increasing the cover price maybe one of the ways of coping with the squeeze, but its dependence on on-stand sales is a clear disadvantage. According to market sources, a large chunk of India Today's circulation (that is about 3 lakh of the total 4.4 lakh copies sold) comes from the stands. Another 1.4 lakh get to the readers through the subscription route. So an increase in price, say observers, may cut into stand sales in the immediate term.
But with a stronger handle over the distribution network - and on the pulse of the reader - India Today can surely get over the initial blips that are likely to accompany the price rise. © 2002 agencyfaqs!