MAM
Yahoo!!, Google erode ad dollars from traditional media houses
MUMBAI: The 10 largest information companies seem to be feeling the some heavy duty revenue heat. Here’s how… According to a report put out by research and advisory firm ‘Outsell’, the astounding revenue growth registered by both search engine majors Google and Yahoo!! is coming at the expense of the 10 largest information companies in what is a $263 billion industry.
The poignant question here is with the explosion of spending on search engine advertising continues to alter the marketing scape; have there been any ramifications for traditional information entities?
Without doubt, search advertising has taken off in a big way which has in turn seen traditional informative publications normal advertising revenues dip as funds have been diverted to Google and Yahoo!. A widely used quote from Outsell’s report gives a fair idea of the search engine advertising affect in a rather candid manner: “they’re [Google and Yahoo!] literally sucking the financial air out of the room.”
The ten information companies that have been referred to are – Daily Mail & General Trust, Gannett, McGraw-Hill, Pearson, Reed Elsevier, Reuters, Thompson, Tribune, VNU, and Wolters Kluwer.
Apparently, money that has originally been set aside for traditionally advertising with these companies has been diverted to be used for search advertising. Outsell reports that the 10-member group generated a combined revenue of $60 billion in 2004, which is $4 billion more than the previous year. Google and Yahoo! alone generated $6.5 billion in 2004, which also indicates a year-over-year increase of $4 billion.
The extraordinary growth of Google and Yahoo! has been attributed to the marketing and advertising spending that would have gone to the other 10 companies, particularly newspapers and B2B trade magazine. The reason partially for the shift is due to the fact that marketers are paying too much for print ads or too little for online ones, according to Outsell.
This puts the traditional media companies into a tough mode in terms of garnering ad dollars. Many newspapers get more than half their revenues from classified, which are really susceptible to the type of ads that Google and Yahoo! are offering.
Also, another important point in note being the ROI efficiency that are generated by search related advertising which draw more advertising dollars, reducing the overall amount that is allocated towards traditional ad methods like yellow page listings and print ads.
This new trend may not essentially spell doom for traditional media outlets. Although, what it does point out is that search engine marketing has gone mainstream. Another possibility that might emerge is that marketers might demand a more cost effective pricing from traditional media houses as they have already experienced marketers that have experienced the low cost per click (CPC) with search advertising.
Nevertheless, with businesses discovering how lucrative search engine marketing programs can be, traditional outlets have already started looking for ways to get back in the game.
Brands
Kwality Wall’s reports standalone losses following strategic HUL demerger
Ice cream major faces Rs 64 crore Ebitda loss amid commodity inflation and muted Q3 sales
MUMBAI: Kwality Wall’s (India) Limited (KWIL) has released its first set of financial results as a standalone entity, revealing a challenging start to its independent journey. Following its successful demerger from Hindustan Unilever Limited (HUL) on 1st December 2025 and its subsequent listing on 16th February 2026, the company is navigating a transition period marked by structural changes and high input costs.
For the quarter ended 31st December 2025, the company reported revenue of Rs 222 crores. Despite the revenue base, the bottom line was impacted by several factors, resulting in an Ebitda loss of Rs 64.2 crores. When calculated on a Pre-IND AS 116 basis, the Ebitda loss stood at Rs 83.8 crores.
Organic Sales Growth (OSG) declined by 6.5 per cent year-on-year during the quarter. Volume growth, however, saw a marginal increase of 1.2 per cent. The company reported a gross margin of 41.5 per cent. Additionally, exceptional expenses amounting to Rs 94 crores were recorded, primarily linked to non-recurring costs during the transition phase.
Performance across portfolios and channels was mixed. Within the impulse portfolio, brands such as Magnum and Cornetto recorded mid-single digit volume growth, indicating steady demand in on-the-go consumption. However, the in-home portfolio, which includes take-home packs, experienced muted consumption. The company is planning a relaunch of this category with improved offerings ahead of the 2026 season.
Quick commerce (Q-Com) continued to emerge as a strong growth driver, delivering robust double-digit growth during the quarter. Meanwhile, the company also expanded its physical distribution network by increasing the number of company-owned cabinets across markets.
Margin pressure during the quarter was driven by a combination of one-off factors and broader cost inflation. Gross margins were impacted by around 600 basis points due to trade investments made for stock liquidation. Additionally, cocoa price inflation contributed to another 400 basis points of pressure on margins.
Deputy managing director Chitrank Goel attributed the muted performance partly to prolonged monsoons and transitional challenges linked to the GST framework. Operating expenses also increased as the company invested in establishing its standalone supply chain, operational systems and corporate infrastructure following the demerger.
Looking ahead, the management remains focused on a volume-driven growth strategy. To restore profitability, the company has initiated a cost productivity programme aimed at reducing non-consumer-facing costs. It is also working on building regional manufacturing networks to optimise logistics expenses and improve operational efficiency.
The commodity outlook for the near term remains mixed. Dairy prices are expected to remain firm due to tight supply conditions and rising fodder costs. Sugar prices may also move higher following increases in the Minimum Selling Price (MSP). While cocoa prices have moderated recently, currency depreciation has offset some of the potential cost relief for the company.
