Battleground Chennai: The war begins (Part II)

In the first part of the story, we talked about how each English daily is trying to lure Chennaites. The second part talks about how the advertising scene for the Chennai English print players could shape up in the near future

Money matters

According to industry estimates, the advertising revenue generated by the Chennai print market is Rs 800 crore. Of this, Rs 550 crore goes to the English press (The Hindu accounts for Rs 350 crore, or about two-thirds of the pie) and the rest to the language publications in Tamil. According to IRS 2007, Round 2, Chennai’s population is 62.86 lakh and the readership for any Tamil daily is 17.83 lakh, while the readership for any English daily is 7.98 lakh. This means that Tamil readership is almost two-and-a-half times that of English.

Says Narendra Kumar Alambara, general manager and head, Starcom Worldwide, Chennai, “For a long time, there was The Hindu and nothing else. However, despite Deccan Chronicle’s entry into this market, the advertising opportunities did not shift dramatically. I have a whole set of clients who still swear by The Hindu.”

The opinion of MindShare’s Chennai head, Kavitha Srinivasan, is no different. She says, “Initially, when Deccan Chronicle forayed into this market, it pushed its Chennai edition along with the Hyderabad edition, and it was successful in getting the corporate advertisers. But there is a substantial chunk of retail advertisers in the city and their willingness to try newer dailies is quite low.”

Some of the retail players in the city are big spenders. Saravana Stores, for instance, spends around Rs 20-25 crore a year, while Chennai Silks spends around Rs 14 crore. Khazana Jewellers and RMKV Silks have budgets of around Rs 10 crore and Rs 8 crore, respectively. Retailers who advertise have just one yardstick: Did my message actually work?

“Local retail players do not have a fancy media plan. They insert an ad in a newspaper and if the response is immediate – walk-ins or call-ins increase – they repeat the ad. As of now, retailers come back to The Hindu and say ‘It works.’ But personally, if I see a pull that’s happening from a particular segment for any daily, I will ask my clients to invest in it provided the pull is sizeable and comes at the right cost,” says Srinivasan of MindShare. The Deccan Chronicle is considered a good option too, say media planners.

The Times of India (ToI), on the other hand, has the great advantage of having multiple editions. It will always have the advantage of bringing the national advertisers under its umbrella. But it will need to have a sizeable base in Chennai first.

Alambara of Starcom believes that ToI can get that base. A section of advertisers and media planners say that ToI also does negative pricing just to keep its competitors in place. Explains R Venkatasubramanian, associate vice-president, Lintas Media Group, “At times, the ToI offers a lower price for all editions than individual editions. This compels many national advertisers to go for all editions. This way, the Times Group keeps its advertisers away from its competitors.”

Days after ToI’s Chennai launch, there came another development that spelt happy news for newspapers. Following a Supreme Court ruling, all the hoardings in the city have disappeared.

Around Rs 100 crore is spent on outdoor advertisements in Chennai, mostly to promote retail brands and feature films. Now with the closure of these outdoor sites, a major chunk of this revenue is expected to move to the print media, which also provides localised reach just like the outdoor medium. Suddenly, the pie itself has grown.

Supplements, too, are a weapon newspapers have found they can use to great effect. To capture the cosmopolitan and young generation, newspapers in Chennai are fighting the supplement battle – and this is the segment that has the least loyalty towards The Hindu. The Chennai Chronicle (a supplement of Deccan Chronicle) is very popular among young Chennaites. So too is Indulge, the daily supplement of The New Indian Express (it is considered to have boosted the sales of the newspaper).

ToI has already proved that it is the master of this game, with such supplements or independent publications in all its other markets, be it Mumbai or Delhi. The Chennai Times, which comes in a tabloid format, is expected to catch the fancy of young readers. The Hindu, too, has given in. The newspaper recently launched a special supplement for the younger generation, called NXG. Besides, it has the daily supplement, Metro Plus.

Other factors

One of the biggest problems that the English newspapers are facing in Chennai is shortage of talent. What happened in Mumbai three years ago (at the time of the DNA and Hindustan Times launch) is happening in Chennai, but with one big difference. Mumbai received talent from all corners of the country (besides, ToI has a ‘no poaching’ agreement with its foe-turned-friend Hindustan Times).

Apparently, just before ToI’s entry in the market, The Hindu raised staff salaries hugely, but smaller players such as The New Indian Express lost many of its journalists to ToI.

Journalists in Chennai today command a premium. An industry insider quips that the placement scene at the Asian School of Journalism acquired IPL-esque proportions this year. Though this will increase the pressure on dailies, which are already burdened by the increasing cost of newsprint and marketing, most consider this money well spent.

The battle has begun in real earnest and the war ahead promises to be fascinating. But it is a prize worth fighting for.