Wounded economies and shrinking client budgets are forcing newspaper publishers to fight the downturn with editorial changes and ad packages that offer greater flexibility and more innovative formats.
HONG KONG
Faced with a slumping economy and property market plus record unemployment, the two English-language newspapers - the South China Morning Post (SCMP) and The Standard - are restructuring, redesigning and repositioning to stay competitive.
Both face an uphill battle as Cantonese speakers now make up as much as 80 to 90 per cent of readership of English-language papers (figures vary depending on whom you speak to). Market leader, SCMP, whose principal owner is Malaysian tycoon Robert Kuok, has a readership base of 311,000 and 3.24 per cent market share, according to ACNielsen figures. The Sing Tao-owned The Standard in comparison is able to secure just 1.27 per cent of the market.
Tommy Ho, senior media analyst at DBS Vickers Securities, says: "Looking at readership figures and trends for circulation, the SCMP is stronger and has been growing with the population and market over the past five years."
But the paper recently had its share of bad press with redundancies as it reorganises its editorial team, an overhaul that followed the appointment of Thaddeus Beczak as publisher. The restructuring included the unusual step of forming a committee of four editors and the appointment of an editorial advisory committee. The latter includes prominent businessmen and legislators who will discuss the paper's editorial direction six times a year.
There are also rumours that the paper will be redesigned at the end of this year and relaunched with three sections - news, business and features.
But this could not be confirmed as the SCMP declined requests for interviews.
Steven Chang, managing director of Equinox Zenith Media, says the English-language press is under pressure to expand categories and clients. To do this, Chang argues that both papers will have to offer greater flexibility to advertisers in order to attract brands with mass appeal.
"Advertisers, whose brands are targeting the masses, have more mass media on hand to consider before they look at English media. Even if the press repositions in the right way, how much more precise and targeted readers can they actually get? The English papers are office subscription-driven, going mostly to companies. In comparison, the Chinese papers are purchased daily by individuals.
"The advertising rates for the Chinese press tend to fluctuate a lot.
They are more flexible; judging from the circulation, readership and rates the Chinese press is generally more cost-efficient. They also offer promotions and coupons."
Meanwhile, underdog newspaper The Standard - which has a 50-year history in Hong Kong - has had two reinventions in the last two years. It went from a broadsheet to a tabloid and renamed itself the iMail and has now gone back to its old name. Chief editor Karl Wilson says its repositioning as iMail was intended to push circulation to 70,000.
But just two months before the relaunch, the Nasdaq market peaked and the technology bubble burst, leaving the paper's then new image as a sad reminder of shattered dotcom dreams. The tabloid, which once competed head-to-head against the SCMP, now focuses on Greater China finance and global sports news. "The SCMP is there and we did not want to try to be a competitor but to look at certain areas where we can do well. Most of the readers of English papers are Chinese and they get their news from Chinese papers so we specialised (in business news), says Wilson.
Media analyst Ho says he is taking a "wait-and-see approach to The Standard.
"It has connections with (China news agency) Xinhua and can tie-in with this to strengthen content. But the fact is that the market is still in Hong Kong and people are interested in local news."
As Ho sees it, the fate of the SCMP hinges on the Hong Kong economy.
For the first half of this year, display advertising for the SCMP dropped 23 per cent, while classified advertising fell 48 per cent. "For the SCMP, its figures are split with 70 per cent from advertising, 30 per cent from circulation. Its success depends on the economy, particularly when you consider classified advertising, which has been very badly hit because of unemployment."
While the SCMP has generally attracted premium or luxury brand advertisers, The Standard has relied heavily on legal notices. But amendments to current regulations, Ho warns, may soon change that. "Listed companies will no longer have to give notices in newspapers. This will be a huge loss to the paper. The only solution for The Standard to sustain itself is to pull in more readers, and this is always difficult for any paper or TV station."
Wilson hinted that The Standard has a contingency plan in place, but did not provide details. Meanwhile, media agencies say the SCMP - in an attempt to lure notice advertising away from The Standard - is offering deeply discounted rates of up to 60 per cent.
Chang adds: "The authoritativeness of the SCMP seems to be diminishing.
Changes in the direction of the paper may be able to bring it back. Losing its authoritative voice is not something that happened overnight, but something that has been taking place over four or five years."
SINGAPORE
The economic downturn and increased market competition have also made trading conditions especially tough for newspaper publishers in Singapore.
There are 15 major newspapers in the city, with Singapore Press Holdings (SPH) publishing 13 of them, including market leader, the Straits Times (ST). ST has a Monday to Saturday circulation of 389,300.
Major editorial changes to ST included last month's revamp of the daily lifestyle section, Life. The design was tweaked and the section has a regular theme each day. Lawrence Loh, SPH senior vice-president marketing, planning and development, said the revamp was aimed at making the section more relevant to advertisers and readers.
One advantage is that advertisers now know the editorial will be relevant to their products, says D. Sriram, Starcom managing director.
In terms of other editorial changes this year, more appears to have been done to SPH's other titles as the launch of a rival free daily commuter paper Today by MediaCorp Press late last year did not have much of an impact on ST but it did make things tougher for the group's other titles such as The New Paper and Streats.
Arthur Sung, account media director at The Media Edge, says his agency has maintained its spend on ST, but has cut back on advertising in SPH's other titles in favour of Today, which has proven popular because it reaches a mass audience and "is a lot more flexible when it comes to creative ideas".
Today advertisers are allowed to run 'island' ads, ads at the top of the page, flags, wrap-arounds and advertorials. Other innovations Today has implemented include letting Dell computers run a front-page wrap around with 'Tomorrow' as the masthead. Vishnu Mohan, managing director of Euro RSCG, Dell's ad agency, says the newspaper let the client use the same font as its masthead although it was in black instead of the customary red.
While Today is winning over media buyers, SPH is hitting back with editorial changes to its free commuter newspaper. Streats was given a more "serious look and the editorial was changed to appeal to executives.
Sung at TME said: "I think the feedback SPH got was that advertisers were opting for Today because Streats was perceived to be a more light and funky paper, while Today was positioned as a more authoritative and newsy publication."
SPH has also boosted content in Shin Min Daily, an evening Chinese language newspaper popular with blue-collar workers, the elderly and housewives.
The paper is the first to publish horse racing and lotto results and has a reputation for reporting on "colourful scandals", according to media buyers.
SPH has responded to the problem of an ageing reader demographic by embarking on a phased exercise to change Shin Min's editorial content in a bid to appeal to younger readers. The process began last month with the paper introducing four extra pages on sport, lifestyle and entertainment.
SPH's other two Chinese titles are Lianhe Zaobao, a morning paper often referred to as the Chinese-language version of the ST, and Lianhe Wanbao, an evening paper that is similar to Shin Min.
In an effort to entice advertisers into the three Chinese papers, SPH introduced bundled discounted deals, including the 'Chinese Triple Bonus Package', giving advertisers a discount if they run the same ad across the three papers.
TAIWAN
Sadly, the going isn't any better in Taiwan, where newspaper adspend plummeted 20.9 per cent last year to NT$17 billion (US$486.6 million).
And a much-hoped boost from the marketing of new products after Taiwan's entry into WTO has yet to materialise.
Jack Wu, media buying director at Carat United Media Services (Taiwan), says competition from cable TV channels is a major problem. The 1990s saw the launch of new media, such as cable TV, targeted magazines and web publications that siphoned off readers. Newspaper readership, which was at a high of 76.8 per cent early in the decade, fell to 59.4 per cent last year.
How the recession has impacted circulation would be revealing, but it is a moot point since none of the island's newspapers are audited. Three national papers - the China Times (NT$4 billion), Liberty Times (NT3.7 billion) and the United Daily News (NT$2.9 billion) - claimed 62.4 per cent of the sector's advertising income last year.
But overall, they have fared better than regional or specialty newspapers because of their ability to offer discounted packages. Still all is not well. The formerly plush China Times and United Daily News are both implementing staff cuts believed to total more than 1,000 jobs. The industry is awash in resumes and many are landing on the desk of the Apple Daily, slated to launch in Taiwan in the second quarter of next year.
THAILAND
The last 12 months have signalled a return to optimism for Thailand's newspaper industry with advertising revenue surpassing initial projections and the first new daily since the 1997 crash boasting a circulation of 700,000 less than a year after its October 2001 launch.
While market leaders Thai Rath, which claims a daily circulation of a million copies, and, to an extent, Daily News, circulation 800,000, are considered too well-established to be pushed off their lofty pedestals, the Nation Multimedia Group's Kom Chad Luek managed to get as high as the third rung of the ladder, pushing Kao Sod to fourth place.
The dailies market - comprising 32 Thai-language papers and two English-language papers - is to gain yet another player in the months to come.
Post Publishing is on schedule for the February introduction of its business daily, which will compete head on with The Nation group's 15-year-old Krungthep Turakij - the only significant player exclusively targeting the young executive.
Analysts say the ease with which Kom Chad Luek grew shows that there is room in the market for new publications with strong content and those backed by major marketing bucks.
