Kodak was a market leader in the photography business less than two decades ago. Its complacence led to an opportunity for digital photography to completely sweep it off its market dominance and almost push it into oblivion – all in a few years.
The newspaper industry is facing a similar challenge with digital and social media platforms. The ‘Indian newspaper industry’ is on the cusp of facing this heat.
Why do we say so?
The answer lies in another industry which is leading a consolidation and disruption. The telecom industry in India is creating a mammoth disruption by enabling internet access to everyone with a smartphone. That is more than a billion users. While the initial threat of newspaper consumption going digital was with English newspapers, the proliferation of regional content of late will impact regional newspapers too if it hasn’t already.
Let’s understand the economics
Ever wondered how the newspaper sells for Rs.5-10? It doesn’t require much intelligence to figure out that the printing, logistics and distribution costs for newspapers would be higher than the selling price.
Where do they make money then? The answer lies in print advertising. In India, newspapers dominate the print industry with more than 95% market share. The efficiency and expertise with local or regional readership and targeting of segments such as business, finance, entertainment, technology, etc. has been unparalleled.
Regional targeting has been overshadowed by contextual marketing and programmatic advertising – thanks to Google and Facebook. These platforms can help you to go local from anywhere in the world. What’s more, it can enable granular targeting of the audience, and serve the news that they love to read. Every click made by the user on these platforms helps the platform to learn and serve news as per their areas of interest. This makes the user click more news from the newsfeeds and read further. The self-fueling cycle gives these digital platforms an advantage that newspapers, in their physical form, can never have.
What compounds the problem?
India’s demographics is such that more than 65% of the population is aged less than 35 years. The millennials are a mobile-first generation and will consume news from digital platforms and apps. The readers of the physical newspapers will increasingly shrink and so will the interest of advertisers in tapping newspapers as a source of advertising.
How can newspapers overcome the ‘Kodak’ like downfall moment?
It would not be wise to think that the game for newspapers has ended. Research shows that the newspaper industry will continue to stay here for a while. However, the digital strategy adopted by newspapers may be the cause of the problem. What’s this strategy?
Newspapers have often launched a digital or a web-based version of their papers. While the content is in place, it may lack the following from the perspective of the Indian user, especially a millennial:
- Cluttered stories with advertisements popping up everywhere is unlikely to appeal to the users
- The engagement quotient is hardly there. The reader will never see what his peers, friends or acquaintances think about the story, which is exactly where digital media and platforms score.
- The user isn’t served what he wants to read but often offered what the newspaper has published. This is a major gap which needs to be addressed.
To avoid the Kodak like downfall, newspaper industry might want to consider three things:
Experience Management: An avid cricket fan only wants to read about cricket so there’s no point serving him everything else too. Can the newspaper industry adopt a digital strategy that customizes the experience? They can take a leaf out of Google and Facebook which relies strongly on the data to do so. Where newspapers can score over these platforms is that it is a niche offering and if it can marry the consumption of stories with interests of the user, it can provide rich insights that advertisers might want to leverage.
The experience management also includes designing a seamless experience. Instead of desperate in-your-face advertising, it might be wise to use smart placements of products/ services within the stories customized to the users. Easier said than done, but technology can enable them to do it today.
Data Analytics: The newspaper industry has never relied on a unique user persona. What I read as news and what any other person would is the same, and therein lies the issue. If they can design mobile apps wherein every user’s navigation patterns are mapped to bifurcate them into buckets, it can enable serving the apt story programmatically to every reader. This will not only engage the reader better and create stickiness but also enable to smartly target and position products to them – isn’t that exactly what advertisers want?
Engagement Management: While it can be considered as a sub-set of the experience, but engagement is all about presenting a voice to the user. Can they react to a story, exchange views, comment on other’s views? Can the newspaper leverage digital to create a sense of community and turn their apps into a platform for discussion and deliberation? Can they make it into a platform where like-minded people who discuss subjects can connect and engage further? In terms of engagement of the level of digital platforms, the newspaper industry has left a lot to be desired and there is immense room for improvement.
With the above three points backed with robust technology, the newspaper industry can become a shining example of a hybrid model (online+ physical) that can give the digital media channels and platform a run for their money.
Let’s hope that our favourite newspapers, which have been an integral part of our daily lives, overcome this digital and data deluge and continue to keep us updated and enlightened.