The lure of local media

As online publishing goes the same way that newspapers, television, and radio did, hyperlocal news apps are attracting investors

More than 20 years ago, in February 2001, Dainik Bhaskar conducted workshops for over a hundred dealers in cities across Haryana, where it had launched new editions. The idea was to convince television, automobile and spare parts dealers that advertising will increase walk-ins and sales.

Local dealers who had advertised with Dainik Bhaskar earlier shared their experiences. In the same year, Radio City, Mid-Day and a dozen other media brands ran workshops, promotions and what not to attract the local jeweller, utensil makers and coaching institutes, among others. Most of these players were launching hyperlocal brands and mobilising local advertising in a bid to reduce dependence on national advertisers who treated language newspapers and smaller brands like Mid-Day with indifference. Over the years, these efforts proved to be hugely successful. Many now get anywhere from 20 to 45 per cent of their revenues from local advertising.

That, essentially, is what online publishers are now attempting to do. Public, a short video news app, gets about 50,000 videos every day. It could be about a fight over water, a wedding, a store opening among myriad things. Anyone can upload a video of up to one minute on local happenings. Since its launch in 2019, it has gathered about 60,000 creators from every district in India. It brings 80 per cent of parent Inshorts’ 80 million unique users.

Way2News covers 95 per cent of the mandals (sub-districts) in the two Telugu-speaking states with over 8,000 stringers, citizen journalists and through crowdsourcing. It gets 7,000-8,000 stories a day.

Both are well-funded. Public raised Rs 300 crore in March 2021 from A91 Partners and a bunch of existing (undisclosed) investors at a valuation of  $250 million (Rs 1,800 crore). Way2News raised Rs 129 crore from WestBridge Capital and venture capitalist Sashi Reddi in June 2022. In the last two years, investors have poured a few hundred million dollars into news apps such as Dailyhunt, QuadZeta and Public that offer localisation in some form. Note that news is, usually, a sad part of India’s Rs 1.6-trillion media and entertainment business. Investors are simply not interested in TV news, newspapers or journalism-based websites. None have the possibility for scale that DailyHunt, Inshorts or Way2News offer.

Mass media brands chased local markets in the late-1990s and the turn of the millennium — because there was an audience and advertiser need. This time round the internet combines them to great effect. It offers the kind of sharp targeting that local newspapers, radio stations or cable channels can simply not match. For example, if you wanted to reach only the people living in Manoramaganj (Indore) or Karve Nagar (Pune), the internet makes it possible with almost no wastage. Most of Way2News’s advertisers are local brands in Andhra Pradesh and Telangana. It could be the local hospital, diagnostic centre, educational institute, or retail showroom.

Going by rough estimates, local advertising — on cable channels, local editions of newspapers, on fliers et al — is roughly Rs 25,000 crore. Note that this is money from unorganised retail and businesses that doesn’t pass through any major media or ad agency. For many of these advertisers, even the creative is designed by the media, like Dainik Bhaskar did for its local advertisers more than 20 years ago. So, it is not part of the Rs 75,000-crore national ad spend figure. This is the money that could start flooding into digital. The results will be interesting.

For one, it could be a huge step towards breaking the hegemony that Google and Meta have over advertising. Going by Comscore data, YouTube had 463 million unique visitors. Meta (Facebook, WhatsApp and Instagram) has between 300 and 500 million users depending on which app is being used. The dominating reach of this duo means that they take away almost 80 per cent of the Rs 24,600 crore that went to digital advertising in 2021. If the game shifts from reach to brand building and, therefore, specific target audiences, local brands will always have an edge.

Going by the latest Nielsen India Internet Report, the game is shifting. Women, rural India and lower income homes are among the fastest growing cohorts of internet users in India. Across India, smartphone sharing is high. It means that the next round of advertising on the internet has to go way beyond the obvious. For example, if you want to reach the female, New Consumer Classification System ‘A’ audience, how do you decide where to advertise? Advertisers will have to experiment with different brands for different needs just like they did while using mass media. Both YouTube and Meta know that too. Note the drive to get local kirana shops and other businesses on Facebook and WhatsApp.

The other thing this online drive towards hyperlocal does is create mine houses of local information and untold stories from rural areas, small towns and kasbahs that never get heard in the Delhi, Mumbai, Bengaluru and Chennai babble. Public, for instance, is wondering whether it could do a syndicated news feed with the 50,000 videos it gets every day.

There is one serious question it raises though. So much user-generated content without enough moderation, curation or journalistic rigour could end up making news apps a hotbed of misinformation. Much of it then gets weaponised by politicians and mischief makers. That is where a media literacy campaign that focuses on people of all ages might help.

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