D. B.Corp - a newspaper company

Recent interview of Girish Agarwal of DB corp. Aired on 30 Apr 2020.

Some highlights:

  1. News papers have not been read so much in metro due to concern about corona virus spreading through newspaper. What is the true picture?
    Ans - This is a metro phenomenon, specially of larger societies. Societies did not allow anybody external to society to come inside during lock-down days. In other parts of India, specially in Tier-2 and Tier-3 cities, circulation number is back to 75-80%. The rest 20-25% is due to offices, shops, airports and railways being shut. Also they are not able to deliver to some towns, where they were dependent on railways.
  2. What would happen to advertisement industry in future?
    Ans - There are two types of companies. Companies who derive 80-85% of revenues from Tier-2 and 3 cities (for example two wheelers) and others who does have more metro concentration. Tier-2 and 3 cities should recover faster than metro because of one metro being shut for more time due to larger number of hot-spots. Another critical factor that local advertisers would come back sharply than national is for a local advertiser, advertisement is to get sales boost at the end of day, it is not for branding. A coaching institute or real estate company or two-wheeler show room would give an ad, see if there is sales calls at the end of day. If yes, he (and other advertises) goes for more ad.
  3. What is the trend of digital readership of news paper and how are you looking for monetization of that?
    Ans - We have seen a 150% jump in digital readership to website and apps. People want to know more about events during the day and hence once they read newspaper in morning, they want updates during the day for news. Monetization of digital readership is far away (>1-2 years). Currently the focus is on acquiring the customers. Unlike metro, where few people are interested in e-newspaper using pdf. the trend is not same across the country. People want to use apps and get updated with news continuously.
  4. Why has advertisers not valued digital readerships vs newspaper readership?
    Ans - Advertisers look newspaper as engagement, but think digital as commodity. They think digital as how many eyeballs I can get and who gives me most eyeball (read fb, insta) and go for that. Overtime, advertisers would recognize that they are not looking for any eyeball (out of context ads) versus a matured eyeball from a credible source.
  5. Is it a challenge to get Indian news readers to pay for news?
    Ans - Not at all. Indian readers are paying approx. 130-150 per month for reading a newspaper. This cost is same as to subscribe for a large number of TV channel. Reader is not shy in paying but they look for good news. (Value for money category). Post-covid, there is a pretty good chance of increasing subscription revenue by 10-15% due to price hike.
  6. Disruption has occurred, what would be changes in industry?
    Ans - Some kind of consolidation might occur in future. There are problems at many print media companies. But the consolidation is not happening. One because newspapers are not capital intensive businesses, especially for old players. Another is the power newspaper printing brings.
  7. Not looking for any major layoff.
  8. Government should help other businesses, that would automatically help media companies.
  9. Radio business is facing tougher time due to reduced listening and subsequently reduced ad.
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