Risk everything now or regret it later. This is the catch-22 situation that most print media companies and publishers in the GCC are facing today. And there are ample – read scary – reasons for that.
Over the past year or so, reports have been trickling in of layoffs and closures of many market-leading titles at top media houses in the Gulf region. This is reflective of the bigger fear among the region’s publishers as advertising revenue – once the lifeline of newspapers and magazines – has been plummeting, combined with the inescapable reality that readers are switching to digital media for content consumption, perhaps tolling the death knell for print.
The latest advertising expenditure forecast, released in June this year by ROI agency Zenith, paints a bleak outlook for MENA print media. The ad expenditure on newspapers in the MENA region fell by 35.4 per cent last year and is forecast to drop by a whopping 50.5 per cent this year and 49.4 per cent next year.
The forecast for magazine ad spend is equally alarming: a 37.3 per cent drop last year, followed by a steeper 43.3 per cent fall this year and again a fall of 39.4 per cent next year, improving marginally at –24.9 per cent in 2019. Like print, the rest of the media channels, including TV, radio, cinema and outdoor, are also forecast to see a massive slash in ad spend from this year to 2019. In fact, the only media to experience a growth in ad spend year-on-year through to 2019 is digital or Internet ad spend.
These are not one-off numbers. The global slowdown is catalysing a permanent change in the print media landscape and also the way publishers across the region and globally should market themselves. But have Gulf publishers learnt the ‘new’ marketing lessons?
The passing of print
To understand why print media are in this situation today, it is important to understand exactly what went wrong. It’s clear that the print news-making industry in the region (and globally) today is in challenging times, stoking fears among publishers on how to survive. The first problem is revenue loss. The digital shift of news consumption, combined with advertisers moving budgets from print to online, has caused a massive shift in the way print media conduct business, resulting in them losing a large chunk of ad revenue to digital players dominated by Internet giants such as Facebook and Google. The second issue is dwindling interest. “The Arab world’s interest in the printed format is showing signs of decline, with its prevalently youthful population preferring to get their news online. The protracted oil slump is a contributing factor as well, with many advertisers trimming their budgets in the face of more cautious consumerism,” says the Managing Director of Orient Planet Group, Nidal Abou Zaki.
Push came to shove when the fall in ad revenue started hitting them where it hurt most, forcing many media companies to scale down and even close titles. While ‘warning’ signs that something is seriously wrong with the media and publishing sector here have been doing the rounds for a long time, they’ve rapidly become more visible in the past few months. One of the recent signs came to light in January this year when ITP Publishing Group closed events and entertainment magazine Time Out Bahrain, continuing only its digital and social media channels. According to media reports, ITP also closed women’s magazine VIVA at the end of last year, while subsidiary APP Media Group closed quarterly celebrity magazines Hello! Arabia and Hello! Indo-Arabia. Further, in May, GN Media ceased operations of women’s monthly Aquarius.
The following month, ITP Media Group announced it would cease production of women’s lifestyle magazine Stylist Arabia and celebrity lifestyle magazine, OK! Middle East.
Old rules don’t apply
As print ads plummet, many publishers are trying to rapidly shift to digital to survive, either making online content free while charging for it in print or simply moving everything from print to digital.
But this latter strategy won’t work either, say market experts. The primary reason is that the region’s print media marketing strategy not only needs to grow and evolve alongside the upsurge of new digital technology, but, more importantly, it also needs to become more personalised and connected to readers’ interests. “A complete shift to digital is not recommendable for the regional market,” explains Zaki. “There are still some publishers pushing to sell content here and we still need more time to assess the effects.”
However, the sad part is that many publishers in the region are doing exactly that – dumping the print content for digital, without targeting their audience.
Alternatively, experts suggest a complete transformation in the way print media companies have been doing business, if they are to survive.
“Switching to digital platforms is not necessarily solving the problem. Payment gateways may be possible only with highly specialised/unique content, e.g., The Economist, The Financial Times or even The Washington Post and The New York Times. Also, publishers need to factor in the cost of generating content for the print medium that is then shared with the online versions,” maintains the current Managing Director, DGConsult FZE and Executive Director, Triune FZ LLC, and formerly Executive Director at Al Nisr Publishing, Duleep George. In fact, the way for print to survive may simply lie in a better understanding of the very strengths of print media – but leveraging this understanding in a new world where everything needs to make sense in a revamped digital landscape. In simple terms, perhaps print media just needs to market itself better – both in print and online.
The Gulf’s print media has its own, often subtle, possibilities – possibilities that are often overlooked by publishers themselves, say experts. There are so many ways to enable proper print media marketing to enhance print media’s strengths in engaging both readers as well as advertisers, they add.
But what is it that has stopped print publishers in the region from evolving and adopting a profitable marketing plan – unlike many of their peers in other markets globally? Was trying to go digital without putting in place a robust digital strategy a grave marketing mistake?
The CEO of STEP Group, Ray Dargham (see his interview) believes so. “Being on digital is the only solution for almost every media company, but this is different than moving print to digital. The worst you can do is take the same content and dump it on a website online, which is what most print publications have done,” he says.
A glaring example of how successful a digital media strategy can be is The New York Times Company, which this year reported substantial growth in its digital business, though its print ad revenue fell. The company’s digital advertising revenue rose 19 per cent, to $50 million, in the first quarter, which ended in late March. It also added 308,000 net digital-only news subscriptions – the most of any quarter in its history – helping to propel an 11 per cent increase in circulation revenue. Mark Thompson, the chief executive of The New York Times, attributed the strong growth in digital advertising revenue largely to the company’s focus on mobile, branded content and marketing and creative services.
Can’t Gulf publishers adopt the same marketing strategy? Sadly, they are not only dumping all print content on digital channels (as Dargham says), but they are shooting themselves in the foot by not acknowledging the value of data in marketing planning today. Understanding and taking advantage of this would not only enable publishers in the GCC or the Middle East to market their publications to the masses and thus aid their longevity, but would also help them meet an advertiser’s target audience.
Experts also attribute marketing failure of the publishers to a more fundamental factor – the lack of the ability in the region’s print publishers to demonstrate to agencies and advertisers both the volume (reach and frequency) and the demographic value of their readers (age, net worth, influence, purchasing power, etc).
Nobody can deny the value of print measurement data in marketing planning of publishers. In this region, however publishers still have a long way to go to put forward the credible reach and frequency numbers of their publications.
“Industry-led print measurement, where the publishers come together, agree on the best data collection approach and abide to one set of numbers that everyone in media, whether print title, media agency, or advertiser, can believe and trust. This gives accurate reach and frequency numbers, but does not happen in this region currently. In other markets around the world, print measurement currency is the most important way in that publishers value their readers and sell their reach to advertisers,” says the Director of Media, MENAP, Nielsen, Sarah Messer.
So what steps should print media companies in the GCC take to expand their share of marketing budgets and to succeed in the new digital environment? What needs to be done for money to be spent on print media?
In a world where large brands are challenging even the mighty goliaths of digital media to prove their ROI, print can still convince them to incorporate print into their mix. But here, the catch is that print has to play a unique role that cannot be replaced easily by digital or TV and it has to be able to generate a profitable scale of operations, say experts.
“The marketing strategy of tomorrow needs to shift from generic instruction to targeted seduction, using personalisation, adaptability and authenticity to achieve its goals,” reasons Managing Partner, RAW (part of Publinet Group), Robin Mehta.
“Encouraging clients to spend on print is still a good idea, but it has to be the right kind of print. As a buyer, I usually follow these simple guidelines: Does the publication have the reach to make it worthwhile? Would my message be communicated better through another medium using the same budget/reach? Can I prove adequate ROI? This is where print publications need to do more; all too often they don’t help themselves,” Mehta adds.
Talking about the marketing strategies that GCC print media can adopt to stay afloat in the current environment, the General Manager of Watermark Marketing Management, Aman Roy, says: “Print still has a lot of relevance, especially amongst the slightly older audience. While digital is no doubt a preferred medium for the younger generation, the older generation still prefer print… The relevance [of print] will largely depend on audience, location and infrastructure availability, etc.”
But how can publishers target their audience and location as well as match advertisers’ needs?
While more and more readers are making digital their primary source of content/news, print shouldn’t ‘waste’ its effort in winning them back.
Instead, it has to build on its strengths and legacy and figure out what role it can best occupy in that content consumer’s life, say experts.
Senior VP and Business Head – Middle East, Africa and APAC at IndiaCast/Viacom 18, Sachin Gokhale, says: “I would urge print media to instead redefine itself as a credible, measured provider of analysis and insight. Print media has to position itself as a destination consumers can visit to get intelligent and diverse perspectives on specialised subjects, written by qualified, credible, respected journalists.”
“I believe full-format broadsheet newspapers, tabloid/gossip magazines, etc., will continue to see a fall in subscription and readership as they do not offer any unique consumer benefit. Meanwhile, over the long term, specialised publications that deal with business, golfing, travel, pets, a specific industry focus, etc., are in a much better position to do well and attract both readership and ad dollars,” he adds.
Adds George of DGConsult FZE: “To generate the required revenues, the digital traffic needs to be monetised and the following may be considered wherein commission forms a substantial revenue source: online shopping; price comparison engines; product comparison engines; online booking for hotels, airlines, events, movies, etc.; and creating and marketing the database of online visitors.”
Roy of Watermark Marketing Management says print media should provide advertisers with more options, which require physical interaction, such as sampling, tear-out vouchers, etc. He goes on to add that print media must alter the look and feel and content to appeal to younger generation and be more contemporary.“ Select topics that require leisure reading rather than on-the-go or news, as print cannot compete with digital on news delivery timelines, resulting in the news often becoming stale,” he elaborates.
The Head of Marketing, India and Middle East at Meltwater, Adele Coelho, suggests one more strategy for the print media to monetise and survive – adopt a subscription model.
“One way publishers can increase revenues is to introduce a subscription model. As consumer behaviours change with the penetration of subscription media services such as Netflix, Hulu, Pandora, etc., regional publishing houses too should consider opting for the freemium subscription model to generate more revenues. This could also flip the revenue model for media companies, with subscriptions becoming the primary revenue stream, while advertising revenues become secondary,” she says.
“Print media is not dead indeed, but they are in a fight for survival and only innovation and self-disruption can save it,” she sums up.
By Sunil Kumar Singh
An expanded version of this article appeared in the Sep 2017 issue of Gulf Marketing Review.