49462388 Times of India Pricing Strategies

“NEWSPAPER PRICING MODEL: IT’S IMPACT ON READER’S CHOICES”

BY

SOHONG CHAKRABORTY CHAKRABORTY (R01-09-012) FOR

POST GRADUATE DIPLOMA IN MANAGEMENT MANAGEMENT UNDER GUIDANCE FROM

Mr. RAKESH SINGH

Senior Manager, Marketing, Times of India 13/1 & 2, Govt. Place (East), Esplanade Mansion, Mansion, Kolkata AND DR. T.K.GUHA

Dean, JSB, Kolkata

Jyotirmoy School of Business Jyotirmoy Knowledge Park Kalikapur, Sonarpur, Kolkata-743330

Newspaper Pricing Model: It’s impact on Reader’s Choice

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DECLARATION The study on “NEWSPAPER PRICING MODEL:

IT’S IMPACT ON

READER’S CHOICES”, submitted by us in partial fulfillment of the requirement for PGDM from JSB, Sonarpur, Kolkata is an original work of my own. I declare that this project has not been published previously elsewhere; it is the result of my own effort & has been taken fully for academic purpose. All education materials consulted in the course of the study have been declared in the reference. I have done this work independently under guidance of our External Guide: Mr. Rakesh Singh, Senior Manager of Bennett, Coleman & Co. Ltd, The Times of India Group and our Internal Internal Guide: Dr. Dr. T. K. Guha, Dean Dean and Faculty of JSB, Kolkata. I am also also thankf thankful ul to Dr. Atri Roy Sengupta Sengupta,, Asst. Asst. Profes Professor sor,, HR, JSB and Prof. Krishanu Maitra, Professor, Marketing, JSB for their help and support provided for the project. This work has not been submitted in full or part to any Institute or University for the award of any degree or diploma.

___________________ Sohong Chakraborty


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DECLARATION The study on “NEWSPAPER PRICING MODEL:

IT’S IMPACT ON

READER’S CHOICES”, submitted by us in partial fulfillment of the requirement for PGDM from JSB, Sonarpur, Kolkata is an original work of my own. I declare that this project has not been published previously elsewhere; it is the result of my own effort & has been taken fully for academic purpose. All education materials consulted in the course of the study have been declared in the reference. I have done this work independently under guidance of our External Guide: Mr. Rakesh Singh, Senior Manager of Bennett, Coleman & Co. Ltd, The Times of India Group and our Internal Internal Guide: Dr. Dr. T. K. Guha, Dean Dean and Faculty of JSB, Kolkata. I am also also thankf thankful ul to Dr. Atri Roy Sengupta Sengupta,, Asst. Asst. Profes Professor sor,, HR, JSB and Prof. Krishanu Maitra, Professor, Marketing, JSB for their help and support provided for the project. This work has not been submitted in full or part to any Institute or University for the award of any degree or diploma.

___________________ Sohong Chakraborty


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ABSTRACT The success of any business entirely depends on marketing and research on the consumer preferences and attitude towards the product. Marketing plays a vital role in a business to make it a success. It is such a topic which cannot be learned through books only. It needs to be learned through practical exposure. In this project I have tried to find out the way the company like Times of India uses marketing as a key to success. I have put my best effort to complete this task on the basis of the skill that I have achieved during my two months internship in The Times of India and studies in the institute. However, I would appreciate if any mistakes are brought to my notice by the readers.

-Sohong Chakraborty

CONTENT Newspaper Pricing Model: It’s impact on Reader’s Choice

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Introduction……………………………………………………….............5 Pricing Model……………………… Model…………………………………………………… ………………………………………………..5 …………………..5 How is pricing done in Newspaper Business?…………………… Business?………………………………………12 …………………12 Price variation and related conditions……………………… conditions……………………………………………….13 ……………………….13

Company Details……………………………………………………….....17 History…………………………………………… History……………………………………………………………………… ………………………………....17 ……....17 Various product of “The Times Group”……………………………………………..19 Group”……………………………………………..19

Objective and Hypothesis………………………………………………..21 Research Objective……………………… Objective………………………………………………… …………………………………………..21 ………………..21 Hypothesis……………………………………………… Hypothesis………………… ……………………………………………………… …………………………...21 ...21

Method………………………………………………………………….....22 Result……………………………………………………………………....23 Data Analysis……………… Analysis………………………………………… ……………………………………………………… ……………………………....23 ....23 Findings…………………………………………………………………………........44

Discussion………………………………………………………………….45 Conclusion…………………………………………………………………47 Limitation and Future scope of study…………………………………....48 References……………………………………………………………….....49 Appendix…………………………………………………………………..50 Questionnaire ………………………… …………………………………………………… ……………………………………………..50 …………………..50

INTRODUCTION Newspaper Pricing Model: It’s impact on Reader’s Choice

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Pricing is a key strategic tool in the battle for any goods and services offered in the market. It generates two items; revenue for the company and other is the cost. Different pricing strategies are adopted around the world for different consumer goods and services to increase customer loyalty and profitability. Pricing Strategy can be done after analyzing such factors for any given goods or services: ➢

Set Pricing Objective

➢

Estimate Demand

➢

Estimate Costs

➢

Analyze Competitors’ Prices

➢

Select Pricing Policy/Method ➢

Set Final Price

A diagram of different pricing strategies :-

Penetration Pricing: This strategy is used for new products/services trying to penetrate the market, or existing products/services entering new markets, by offering initial low prices. The price is deliberately Newspaper Pricing Model: It’s impact on Reader’s Choice

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set at low level to gain customer's interest and establishing a foot-hold in the market. Such low prices will attract the customer and through continued use and purchase, they may not be discouraged by any future price increases and remain loyal to the product/service. In other words, the initial low price that you offer may not even cover all associated costs, but when you increase the price in the future, it will compensate for the loss you made or any profits you missed out on. For example, the first two or three editions of a monthly magazine may be offered at, say, Rs.50, but after this the magazine price increases to, say, Rs.100. Because most people will have found interest in the first editions of the magazine, they are likely to continue buying the magazine in the future.

Competition-based pricing (Influence of Elasticity) Setting the price based upon prices of the similar competitor products. Competitive pricing is based on three types of competitive product: 

Products have lasting distinctiveness from competitor's product. Here we can assume



The product has low price elasticity.



The product has low cross elasticity.



The demand of the product will rise.



Products have perishable distinctiveness from competitor's product, assuming the product features are medium distinctiveness.



Products have little distinctiveness from competitor's product. assuming that:



The product has high price elasticity.



The product has some cross elasticity.



No expectation that demand of the product will rise.

Cost-plus pricing Cost-plus pricing is the simplest pricing method. The firm calculates the cost of producing the product and adds on a percentage (profit) to that price to give the selling price. This method although simple has two flaws; it takes no account of demand and there is no way of determining if potential customers will purchase the product at the calculated price. Newspaper Pricing Model: It’s impact on Reader’s Choice

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This appears in 2 forms, Full cost pricing which takes into consideration both variable and fixed costs and adds a % markup. The other is Direct cost pricing which is variable costs plus a % markup, the latter is only used in periods of high competition as this method usually leads to a loss in the long run.

Contribution margin-based pricing/Contribution Pricing We know, Contribution = Selling Price – Variable (direct costs) Contribution margin-based pricing maximizes the profit derived from an individual product, based on the difference between the product's price and variable costs (the product's contribution margin per unit), and on one’s assumptions regarding the relationship between the product’s price and the number of units that can be sold at that price. The product's contribution to total firm profit (i.e., to operating income) is maximized when a price is chosen that maximizes the following: (contribution margin per unit) X (number of units sold).

Target pricing Pricing method whereby the selling price of a product is calculated to produce a particular rate of return on investment for a specific volume of production. The target pricing method is used most often by public utilities, like electric and gas companies, and companies whose capital investment is high, like automobile manufacturers. Target pricing is not useful for companies whose capital investment is low because, according to this formula, the selling price will be understated. Also the target pricing method is not keyed to the demand for the product, and if the entire volume is not sold, a company might sustain an overall budgetary loss on the product.

Marginal-cost pricing In business, the practice of setting the price of a product to equal the extra cost of producing an extra unit of output. By this policy, a producer charges, for each product unit sold, only the addition to total cost resulting from materials and direct labor. Businesses often set prices close to marginal cost during periods of poor sales. If, for example, an item has a marginal cost of $1.00 and a normal selling price is $2.00, the firm selling the item might wish to lower the price to $1.10 if demand has waned. The business would choose this approach because the incremental profit of 10 cents from the transaction is better than no sale at all.


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Absorption/Full Cost Pricing Method of pricing in which all costs are recovered. The price of the product includes the variable cost of each item plus a proportionate amount of the fixed costs. A form of cost plus pricing •

Full Cost Pricing – attempting to set price to cover both fixed and variable costs

•

Absorption Cost Pricing – Price set to ‘absorb’ some of the fixed costs of production

Market Creaming or skimming Selling a product at a high price, sacrificing high sales to gain a high profit, therefore ‘skimming’ the market. Usually employed to reimburse the cost of investment of the original research into the product – commonly used in electronic markets when a new range, such as DVD players, are firstly dispatched into the market at a high price. This strategy is often used to target "early adopters" of a product or service. These early adopters are relatively less pricesensitive because either their need for the product is more than others or they understand the value of the product better than others. This strategy is employed only for a limited duration to recover most of investment made to build the product. To gain further market share, a seller must use other pricing tactics such as economy or penetration. This method can come with some setbacks as it could leave the product at a high price to competitors.

Value/Premium pricing Premium pricing is the practice of keeping the price of a product or service artificially high in order to encourage favorable perceptions among buyers, based solely on the price. The practice is intended to exploit the (not necessarily justifiable) tendency for buyers to assume that expensive items enjoy an exceptional reputation or represent exceptional quality and distinction.

Loss leader Basic Concept In the majority of cases, this pricing strategy is illegal under EU and US Competition rules. No market leader would wish to sell below cost unless this is part of its overall strategy. The idea of selling at a loss may appear to be in the public interest and therefore not often challenged. Only when the leader pushes up prices, it then becomes suspicious. Loss leadership can be similar to predatory pricingor cross subsidization; both seen as anticompetitive practices.


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Psychological pricing Pricing designed to have a positive psychological impact. For example, selling a product at Rs.99.95 or Rs.99.99, rather than at Rs. 100.

Price Matching/ Going Rate Pricing Many businesses feel that lowering prices to be more competitive can be disastrous for them (and often very true!) and so instead, they settle for a price that is close to their competitors. Any price movements made by competition is then mirrored by yourself: so long that you can compensate for any reductions if they lower their price. An observation made of oligopoly business behavior in which one company, usually the dominant competitor among several, leads the way in determining prices, the others soon following. Your business may be considered as one of the more dominant within it’s market because you offer a service or product that is unique or popular (through branding). As a result, you may have the power to set the price in which your competitors will attempt to follow.

Tender Pricing ➢

Many contracts awarded on a tender basis.

➢

Firms (or firms) submit their price for carrying out the work.

➢

Purchaser then chooses which represents best value

➢

Mostly done in secret.

Price Discrimination: Price discrimination involves charging different prices for your product/service at certain times, or to different types of customers. The classic scenario is telephone services charges off-peak hours are much cheaper than peak hours. It means setting a different price for the same product in different segments to the market. For example, this can be for different ages or for different opening times, such as cinema tickets. This is because they know that their service is in high demand during peak time (around 8am 6pm) as they are the business operating hours. Another common discrimination is offering your service at higher prices during the weekend (Saturday and particularly Sunday) as customers may find it hard to find other alternative services during this time. Newspaper Pricing Model: It’s impact on Reader’s Choice

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The above examples are all to do with timing, but the other price discrimination is aimed at the different types of customer. In this case, the best example would be offering students a discount of, say, 10% for using your service or buying your product, you may even offer your service/product cheaper to loyal customers, say, those that have been trading with you for more than a year.

Destroyer/Predatory Pricing: This strategy is used as an attempt to eliminate competition. It involves lowering your prices to an extent where competition cannot compete and consequently, they go out of business. By just reading the last sentence, it sounds very threatening to not only the competition, but also to yourself: this is what you find with all competition based pricing strategies. It is therefore important that you recognize how threatening the competition is and research how competitive they can be with their prices: they may be able to compete with your price cuts and consequently you both, or even just yourself may go out of business. Predatory pricing can be said as an aggressive pricing intended to drive out competitors from a market. It is illegal in some places.

The Other types of pricing strategies are as follows:-

Pricing to Customer Expectations: This would involve extensive market research, as the idea is to charge what customers are willing to pay (within reason). If your product/service is new or unfamiliar in the market, you can expect potential customers to give it a low price. Alternatively, if your product/service is popular or unique in the market, you can expect people to be more favorable toward its value. If you adopt this strategy, you should review your research periodically, say, every six months as customers may develop a different attitude toward your product/service. Consequently, in time, customers may value your product/service differently and so you should change your price to correspond with customer expectations, whether they are higher or lower.


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Limit pricing A limit price is the price set by a monopolist to discourage economic entry into a market, and is illegal in many countries. The limit price is the price that the entrant would face upon entering as long as the incumbent firm did not decrease output. The limit price is often lower than the average cost of production or just low enough to make entering not profitable. The quantity produced by the incumbent firm to act as a deterrent to entry is usually larger than would be optimal for a monopolist, but might still produce higher economic profits than would be earned under perfect competition. The problem with limit pricing as strategic behavior is that once the entrant has entered the market, the quantity used as a threat to deter entry is no longer the incumbent firm's best response. This means that for limit pricing to be an effective deterrent to entry, the threat must in some way be made credible. A way to achieve this is for the incumbent firm to constrain itself to produce a certain quantity whether entry occurs or not. An example of this would be if the firm signed a union contract to employ a certain (high) level of labor for a long period of time.

Market-oriented pricing Setting a price based upon analysis and research compiled from the targeted market. Also with the cost price.

Dynamic pricing A flexible pricing mechanism made possible by advances in information technology, and employed mostly by Internet based companies. By responding to market fluctuations or large amounts of data gathered from customers - ranging from where they live to what they buy to how much they have spent on past purchases - dynamic pricing allows online companies to adjust the prices of identical goods to correspond to a customer’s willingness to pay. The airline industry is often cited as a dynamic pricing success story. In fact, it employs the technique so artfully that most of the passengers on any given airplane have paid different ticket prices for the same flight.

How is pricing done in newspaper business?

Cost of manufacturing a single product like newspaper depends on the cost of printing, cost of buying rolls of paper sheets (raw material), transportation cost, electricity used, administrative cost, cost of collecting of daily news and photographs by the press, machinery usage, labor usage and various other indirect cost factors. The total cost of producing/publishing of Newspaper Pricing Model: It’s impact on Reader’s Choice Page 11

newspaper on a given month divided by the total products manufactured on that particular month gives the per unit cost of the newspaper. Hence, the output of these factors results into a price which can’t be acceptable by daily consumers of newspaper, ie., the cost of manufacturing a single news paper is much higher than its MRP (maximum retail price). To reduce the price, space selling for advertisements is required as it acts as revenue for the newspaper business. This effort makes the daily newspaper affordable for daily consumption by the consumers.

The pricing model followed by the newspaper business is known as dynamic pricing strategy. Let us discuss what dynamic pricing is: A flexible pricing mechanism made possible by advances in information technology, and employed mostly by Internet based companies. By responding to market fluctuations or large amounts of data gathered from customers - ranging from where they live to what they buy to how much they have spent on past purchases dynamic pricing allows online companies to adjust the prices of identical goods to correspond to a customer’s willingness to pay. The airline industry is often cited as a dynamic pricing success story. In fact, it employs the technique so artfully that most of the passengers on any given airplane have paid different ticket prices for the same flight. News paper business also follows the same pricing model where we see to different kind of pricing according to the day. If MRP of a newspaper cost Rs.2/- on the weekdays then on the weekend we find the MRP of the same newspaper around Rs.5/-.

Price Variations and related conditions Cover pricing The price of a newspaper or magazine which is printed on the cover and paid by the final purchaser. It is the market rate (MRP) at which it is sold. It depends on various factors like:1)

What price customers are willing to pay?

This condition depends on the customer who is willing to pay the price for the final good. Consumers like buying good quality material at low price. The expected price should match the consumer’s confidence to afford the good and pay the price. For daily consumption of newspaper the price should be always set to a reasonable rate. Newspaper Pricing Model: It’s impact on Reader’s Choice

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Generally loyal customers don’t think of the price and affords it even in a price rise situation till it becomes unaffordable. 2)

What kind of market condition where the goods are sold?

Market condition depends upon economical factors of the geographic location such as inflation, depression, post war affected areas, Oil price hick which ultimately increases the transportation cost of most business, price increase of raw material, perfect competitors in the same business, shortage of goods availability because of huge increase in demand due to popularity or affects of any breaking news regarding political turmoil, massive accidents, fluctuations in share market, etc… 3)

Strategic position of the company

The strategic position of the company depends upon many factors and is a key issue in the business environment. The companies are not isolated entities but operate in the context of an external environment. It is therefore imperative to not only evaluate oneself on an absolute scale but more so in relation with what is happening on the exterior. One of the foremost prerequisites in defining an organization's strategic orientation is the knowledge of the organization's current positioning. An organization operates within certain bounds that are created by its direct competitors and industry of operations (the immediate neighborhood) as well as the macroenvironment. To estimate the current positioning, these elements have to be analyzed separately and in unison to understand the possible effects and develop a clearer image of strategic positioning. Over the years, various frameworks have been provided by researchers to make the analysis simpler. To begin stepwise, first we have to understand the macro environment and then the industry and competitors. It is common understanding that a country's economic health is inseparably conjoined with its political environment. We are aware of the repercussions of the world wars, the current hyperinflation in Zimbabwe and many other such examples from the history that have validated this notion. So without even going into the nuances of the political impact, one can empirically claim that political environment should be necessarily studied to assess the strategic position of the organization. In what ways it has a bearing is manifold and specific to the industry; for the polity being both the legislative and executive body for the entire nation.


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The second important aspect that needs to be analyzed is the economic health of the country of establishment and the world market. For this, regular scrutinizing has to be done to decipher the influence of economic decisions made by the government on the industry and possible turbulences in the external world. Polity has a tremendous bearing on economics and their exchange has to be thoroughly studied to figure out strategic position. Once we have analyzed the political and economic environment, we should begin to understand the social factors. The social fabric of the society is of tremendous significance in shaping up an organization. Extensive research goes into figuring out the needs and demands of the people and their expectations, which by itself is quite a task for market research companies. Not just that, the culture of the place, the traditions, the history … everything contributes to the making of the social fabric. It is within the dynamics of this fabric that an organization directly interacts with making it one of the key macro environmental factors for assessment. The final analysis deals with the current technology and its relevant future advancements. Over the years, we have seen how this world has changed due to the development in science and technology. Many companies that failed to adapt to the changing environments either perished through major defaulting or were hostilely acquired by other companies. As Darwin's theory suggests, the world is all about survival of the fittest. To remain strong in today's competitive world, technological update is of prime relevance and organizations need to be aware of it. All these factors when studied together, we gate a complete picture of the strategic position of a company which can be denoted by a graphical representation.

Stand alone pricing Method that allocates a portion of common costs to each user by applying a ratio equal to the stand-alone cost of providing benefits to that user divided by the sum of the stand-alone costs for all users. Stand alone pricing is done after the stand alone cost is allocated with a minimal margin. Stand alone pricing is generally done with bundle pack offers for a limited period. The limitations of the period are fixed by the company itself and hence demand of the products increases for a short period. For example, a 100 g soap, a 200g Shampoo and a 150g Talcum Powder, bundle together (packed in a single package) comes at Rs.80/- whereas, if each of the single product purchased adds up to Rs 100/-. Now it is up to the customers who get an option of buying the product according to his will and requirement.

Subscription Pricing Newspaper Pricing Model: It’s impact on Reader’s Choice

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This type of pricing is typically done for adding new customers without subsidizing existing customers. Subscription of newspaper tends to be low priced then usual as customers pay the price for a period of time on an upfront basis, ex., monthly or yearly or seasonal. It comes in a package which ultimately becomes cheaper for new buyers while saving time and money for a customer. The main issue in newspaper or magazine business is those subscriptions are paid up front, and this might actually prevent some customers from signing up. But it also helps in gaining new loyal customer too. Renewal of subscription is also done for the buyers who want the subscription repeated after completion of the previous subscription contract. An agreement of subscription has an added advantage for the organization as they can directly interact with the customer avoiding the vendors. This helps the organization in increasing customer database marketing as well as personalized marketing thus selling agreement of subscription in a customized manner to different individuals with different needs. For example, an individual agrees to subscribe Times of India on a daily basis for a year while the individual’s neighbor wants a subscription of Times of India to be delivered seven days a week as well as Economic times to be delivered five days a week exceeding the weekends for a period of three years.

Invitation Pricing Generally, for a new product launched in a given market is always set to a low price to attract consumer and create a market share of the product. This helps in gaining new customer base as well as levels over priced product of similar quality. After gaining popularity and creating a customer base, the price is raised to an affordable rate to generate more profit for a company. Now days, generally invitation pricing is not in use. An example of invitation pricing is “The Crescent” weekly magazine from the Times of India group which has been introduced in the eastern sector of India recently with a nominal price of Rs. 6/- per copy.


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Company Details The Times Of India was founded on November 3, 1838 as The Bombay Times and Journal of Commerce, during the British Raj era. Published every Saturday and Wednesday, The Bombay Times and Journal of Commerce were launched as a bi-weekly edition. It contained news from Britain and the world, as well as the Subcontinent. The daily editions of the paper were started from 1850 and in 1861, the Bombay Times was renamed The Times of India. In the 19th century this newspaper company employed more than 800 people and had a sizable circulation in India and Europe. It was after India's Independence that the ownership of the paper passed on to the then famous industrial family of Dalmiyas and later it was taken over by Sahu Shanti Prasad Jain of the Sahu Jain group from Bijnore, UP. India's press in the 1840s was a motley collection of small-circulation daily or weekly sheets printed on rickety presses. Few extended beyond their small communities and seldom tried to unite the many castes, tribes, and regional subcultures of India. The Anglo-Indian papers promoted purely British interests. Robert Knight (1825–1892) was the principal founder and the first editor of the Times. The son of a London bank clerk from the lower-middle-class, Knight proved a skilled writer and passionate reformer. Knight helped create a vibrant national newspaper industry in British India. When the Sepoy Mutiny erupted, Knight was acting editor of the Bombay Times and Standard . He broke with the rest of the English language press (which focused on Indian savagery and Newspaper Pricing Model: It’s impact on Reader’s Choice

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treachery) and instead blamed the violence on the lack of discipline and poor leadership in the army. That angered the Anglo community, but attracted the Times's Indian shareholders, who made him the permanent editor. Knight blasted the mismanagement and greed of the Raj, attacking annexation policies that appropriated native lands and arbitrarily imposed taxes on previously exempt land titles, ridiculing income taxes, and exposing school systems that disregarded Indian customs and needs. Knight led the paper to national prominence. In 1860, he bought out the Indian shareholders and merged with the rival Bombay Standard , and started India's first news agency. It wired Times dispatches to papers across the country and became the Indian agent for Reuters news service. In 1861, he changed the name from the Bombay ‘Times and Standard’ to the ‘Times of India’. Knight fought for a press free of prior restraint or

intimidation, frequently resisting the attempts by governments, business interests, and cultural spokesmen. The Times of India (TOI) is an English-language broadsheet newspaper that is widely read

throughout India. It has the largest circulation among all English-language newspapers in the world, across all formats (broadsheet, tabloid, compact, Berliner and online). It is owned and managed by Bennett, Coleman & Co. Ltd. which is owned by the Sahu Jain family. Indu Jain belongs to the Sahu Jain family and is the current chairperson of India's largest media group, Bennett, Coleman & Co. Ltd., which owns the Times of India and other large newspapers. Her net worth is said to be US$4.4 billion, making her the 17th richest Indian in the world. She is widowed with two sons. In 2008, the newspaper reported that (with a circulation of over 3.14 million) it was certified by the Audit Bureau of Circulations as the world's largest selling English-language daily newspaper, placing as the 8th largest selling newspaper in any language in the world. According to the Indian Readership Survey (IRS) 2010, the Times of India is the most widely read English newspaper in India with a readership of 13.4 million. This ranks the Times of India as the top English newspaper in India by readership. According to Com-Score, TOI Online is the world's most-visited newspaper website with 159 million page views in May 2009, ahead of the New York Times, The Sun, Washington Post, Daily Mail and USA Today websites.

Fact 1 : World Top Ten English Dailies (net sales) 1. The Times of India (India): 3,433,000 2. The Sun (UK): 3,046,000 Newspaper Pricing Model: It’s impact on Reader’s Choice

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3. USA Today (USA): 2,293,000 4. Daily Mail (UK): 2,194,000 5. The Wall Street Journal (USA): 2,012,000 6. The Daily Mirror (UK): 1,400,000 7. The Hindu (India): 1,331,000 8. The Hindustan Times (India): 1,189,000 9. The Deccan Chronicle (India): 1,003,000 10. The New York Times (USA): 1,001,000

Various Products of ‘The Times Group’ The Times of India The Times of India is the flagship brand of the Group. It is India's premier English daily and world’s largest circulated English broadsheet daily. It is published from ten cities across India, has a circulation of over 21,44,842 copies, and is read by over 4.42 million people.(Website: www.timesofindia.com)

The Economic Times The Economic Times, started in 1961, is India's largest and among the world's top three English business dailies. The Economic Times is published simultaneously from seven cities across India, has a circulation of 400,000 copies, and is read by over 1 million people every day. (Website: www.economictimes.com).

Navbharat Times Navbharat Times, launched in 1950, is a widely read and influential Hindi daily. It is published from Delhi and Mumbai, and has a combined circulation of over 430,000 copies and a readership of over 1.7 million. (Website: www.navbharattimes.com)

Maharashtra Times


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Maharashtra Times is a Marathi newspaper published from Mumbai. It has a circulation of over 200,000 copies, and a readership of over a million. (Website: www.maharashtratimes.com)

Filmfare Filmfare has evolved as an entertainment medium in itself. The monthly magazine Filmfare covers the gamut of happenings in show biz, including movies, music and television. The magazine also sponsors the annual Filmfare awards for excellence in Indian cinema. (Website: filmfare.indiatimes.com)

Femina The No. 1 women's magazine in India, Femina caters to the woman of substance. Femina also organizes and sponsors the Miss India pageant annually. The winners of these contests represent India in the Miss Universe, Miss World, and Miss Asia-Pacific contests. (Website: femina.indiatimes.com)

Indiatimes Indiatimes.com is India's online nerve centre for new, information, entertainment, cricket, shopping, services and much more. The USP is Content, Commerce and Community. And with over a billion page views a month.

Fact 2: Current Weekly Billing comparison of different Print Media Dailies in Kolkata

Ananda Statesma bazar Telegraph n Patrika

TOI Mon

2.50

2.50

2.50

3.50


Bartaman Aaj Kaal 2.50

3.00 Page 19

Tue

2.50

2.50

2.50

3.50

2.50

3.00

Wed

2.50

2.50

2.50

3.50

2.50

3.00

Thurs

2.50

2.50

2.50

3.50

2.50

3.00

Fri

2.50

2.50

2.50

3.50

2.50

3.00

Sat

2.50

2.50

2.50

3.50

3.00

3.50

Sun

4.00

5.00

3.50

5.00

4.00

4.00

19.00

20.00

18.50

26.00

19.50

22.50

Wk Billing

Objective and Hypothesis Research Objectives: The objective of the project is to figure out that the drop in sales of newspaper is due to price increase and not due to the quality and service provided. The impact of increase or decrease in demand of newspaper varies due to such pricing adjustments. Therefore drop in demand leads to decrease in sales. Research Questions: The research question is based on a survey of “Current Readership behavior of Kolkata Market” assuming that Kolkata newspaper readers take both English and Bengali newspaper on a daily basis.

Hypotheses: The hypotheses for the research are: 1)

Readers with high satisfaction with the quality and service will be more likely to continue with the current paper even at a moderate price increase.

2)

Readers with a low satisfaction level with quality and service will be less likely to continue with the current paper even at a moderate price increase.

3)

In majority of cases where readers decide to drop newspaper, Bengali newspapers will be retained.


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Method

Method of Data collection:

Sample size: 50 Newspaper Readers

Details of Participation : Chosen randomly by visiting houses (door to door) in Kolkata.

Sampling Technique : Convenience Sampling- We used the Convenience sampling technique,

because we collected all the information from those members of the population who were conveniently available to provide it. It is not advantageously placed to get information required.

Research Instrument : Questionnaire designed under the guidance of my Company guide.

Instruments to Measure : Reading habits of newspaper reader

Awareness on price increase Action taken on such condition


Page 21

RESULT

Data Analysis (Hypotheses Testing)


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Which newspapers do you buy?

I was mainly concerned about the consumer preferences while buying newspaper. So, according to my objectives, the first thing, which I asked them which newspaper they buy.

According to the response I got this statistics:66% of the consumer choose both English and Bengali newspaper 24% of the consumer chooses only English 10% of the consumer chooses others

How do you buy your newspapers? The next thing was how they buy their newspaper. The mode of buying news paper differs according to their preferences.


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According to the response I got this statistics:74% of the consumers buy Subscription pricing mode 24% of the consumers buy Stand alone pricing mode 2% of the consumer chooses any others mode/ways like buying from the street hawker or vendors in the railway station

Are you satisfied with the quality of the newspaper you read?

After they buy the newspaper, are they really satisfied with the quality of the newspaper they read.

According to the response I got this statistics:80% of the consumers are satisfied with the quality. 14% of the consumers are neutral about the quality. 6% of the consumers are very satisfied about the quality. There is no level of dissatisfaction in consumers regarding quality.

Are you satisfied with the price you pay for the newspaper? Newspaper Pricing Model: It’s impact on Reader’s Choice

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The next things asked to the customers are about the price they pay for the newspaper.

According to the response I got this statistics:63% of the consumers are satisfied with the price. 21% of the consumers are neutral about the price. 12% of the consumers are very satisfied about the price. 4% of the consumers are dissatisfied regarding the price There is no level of very dissatisfaction in consumers regarding quality.

How much are you satisfied by the service provided by your newspaper brand?

The next question was if they are satisfied by the service provided by the newspaper brand.

According to the response I got this statistics:72% of the consumers are neutral with the service. 14% of the consumers are satisfied about the service. 10% of the consumers are very satisfied about the service. 4% of the consumers are dissatisfied regarding the service. Newspaper Pricing Model: It’s impact on Reader’s Choice

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There is no level of very dissatisfaction in consumers regarding quality.

If the current price of your newspaper is increased by 25%, will you continue reading your existing newspaper?

When I asked them, if they will continue reading their current newspaper if price is increased by 25%,

According to the response I got this statistics:88% of the consumers will continue with the increased price. 12% of the consumers will not continue.

If the current price of your newspaper is increases by 50%, will you continue reading your existing newspaper?

When I asked them, if they will continue reading their current newspaper if price is increased by 50%,


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According to the response I got this statistics:62% of the consumers will not continue. 26% of the consumers will continue with the increased price. 2% of the consumers are indifferent with the increased price.

Suppose there is an increase in price on both of your favorite newspapers from the current level, which one will you like to drop /stop taking the newspaper.

According to the response I got this statistics:52% of the consumers will drop Bengali newspaper. 44% of the consumers will drop English newspaper. 4% of the consumers are indifferent.


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The preference (reading habits) and the buying pattern of the consumers changes according to the Income

The perception of the consumer lot depends upon the income group they fall into. The Income range is given in alphabets. There are 4 ranges: A(5000-25000), B(25100-45000),C(4510065000), D(65100 & above). Among the 50 samples the data collected shows the study of are as follows:

Choice of Newspaper: •

21 consumer preffer to read both english and bengali ,4people preffer only english and 1 in others in income group A.

•

9 people preffer English and bengali, 4 people preffer only english and 2 consumer preffer others in income group B.

•

1 people preffer English and Bengali, 2 consumer preffer only english and 1consumer preffer other in the income group C.

•

2 consumer preffer English and bengali both ,2 consumer preffer only english and 1 preffer others in income group D.

Choice of Mode: •

19 consumer preffer subcription, 7 preffer stand-alone in the income group A.

•

11 consumer preffer subcription, 8 preffer stand-alone and 1 others in the income group B.

•

3 consumer preffer subcription, 1 preffer stand-alone in the income group C.

•

4 consumer preffer subcription, 1 preffer stand-alone in the income group D.

Choice of Quality: •

21 consumer are satisfied, 3 are nutral and 2 are very satisfied with the quality in the Income group A.


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•

11 consumer are satisfied, 3 are nutral and 1 consumer is very satisfied with the quality in the Income group B.

•

3 consumer are satisfied, 1 are nutral with the quality in the Income group C.

•

5 consumer are satisfied, with the quality in the Income group D.

Price they pay: •

18 consumers are satisfied, 5 are nutral, 2 are very satisfied and 1 consumer is dissatisfied regarding the price they pay in the income g roup A.

•

7 consumers are satisfied, 4 are nutral, 3 are very satisfied and 1 consumer is dissatisfied regarding the price they pay in the income group B.

•

3 consumers are satisfied and 1 are nutral regarding the price they pay in the income group C.

•

4 consumers are satisfied, 1 are nutral, regarding the price they pay in the income group D.

Service they get: •

17 consumers are satisfied, 4 are nutral, 4 are very satisfied and 1 consumer is very dissatisfied regarding the sevice in the income group A.

•

11 consumers are satisfied, 3 are nutral, 1 are very satisfied regarding the sevice in the income group B.

•

3 consumers are satisfied and 1 is dissatisfied regarding the sevice in the income group C.

•

5 consumers are satisfied regarding the sevice in the income group D.

By 25% price increase: •

22 consumer say yes for continuing existing paper and 4 consumer say no when the price is increased for the income group A.

•

14 consumer say yes and 1 consumer say no when the price is increased for the income group B.

•

3 consumer say yes and 1 consumer say no when the price is increased for the income group C.


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•

5 consumer say yes when the price is increased for the income group D.

By 50% price increase: •

5 consumer say yes and 21 consumer say no when the price is increased for the income group A.

•

10 consumer say yes and 5 consumer say no when the price is increased for the income group B.

•

1 consumer say yes and 3 consumer say no when the price is increased for the income group C.

•

2 consumer say yes and 2 consumer say no when the price is increased for the income group D.

Drop Newspaper: •

15 consumers drop english, 11 will drop bengali in the income group A.

•

5 consumers drop english, 8 will drop bengali and 1 consumer have indifferent decission in the income group B.

•

1 consumers drop english, 2 will drop bengali and 1 consumer have indifferent decission in the income group C.

•

5 will drop bengali in the income group D.


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According to the prefference of Female consumers the following data has been obtained:


Page 31

Among the 50 sample collected 16 newspaper readers are female.

•

10 preffer English and bengali, 4 preffer only English and 2 female consumer preffer other newspapers.

•

13 preffer subcription, 2 preffer stand-alone and 1 preffer other mode of buying newspaper.

•

•

11 are satisfied, 4 are nutral and 1 is very satisfied with the quality of the newspaper. 10 are satisfied, 4 are nutral, 1 is very satisfied and 1 is dissatisfied with the price of the newspaper.


Page 32

•

10 are satisfied, 5 are nutral and 1 is very satisfied with the service provided by the newspaper.

•

15 consumer says yes and 1 say no with the 25% increase in price of newspaper they read.

•


•

7 consumer says drop english and 9 say drop bengali if both the prices are increase in price of newspaper they read.


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According to the prefference of Male consumers the following data has been obtained:

Among the 50 sample collected 34 newspaper readers are male.

•

23 preffer English and bengali, 8 preffer only English and 3 male consumer preffer other newspapers.

•

24 preffer subcription, 10 preffer stand-alone mode of buying newspaper.

•

29 are satisfied, 3 are nutral, 2 is very satisfied with the quality of the newspaper.

•

22 are satisfied, 7 are nutral, 4 is very satisfied and 1 is dissatisfied with the price of the newspaper.

•

26 are satisfied, 2 are nutral, 4 is very satisfied and 2 are dissatisfied with the service provided by the newspaper.


Page 34

•


•

11 consumer says yes, 22 say no and 1 is indifferent with the 50% increase in price of newspaper they read.

•

15 consumer says drop english, 17 say drop bengali and 2 are indifferent if both the prices are increase in price of newspaper they read.

Multiple Regression Analysis Variables Entered/Removedb

Model

Variables Entered

Variables Removed


Method Page 35

1

Enter

SATS SATQa

a.

All requested variables entered.

b.

Dependent variable: S150

Model summary

Model

R

R square

Adjusted R Std error of Square the estimat e

1

.148a

.022

-.020

a.

.5398

Predictors: (Constant),SATS,SATQ

Anovab

Model

Sum of Squars

df

Mean Square

F

Sig.

1 Regression

.305

2

.152

.523

.596a

Residual

13.695

47

.291

Total

14.000

49

a.

Predictors: : (Constant),SATS,SATQ

b.

Dependent variable: S150

Coefficientsa


Page 36

Model

Unstandardized Coefficients

Standardized

t

Sig.

Coeffic ient B 1

Std. Error

(Constant)

2.009

.706

SATQ

2.831E-02

.197

SATS

-.134

.140

Beta 2.846

.007

.024

.143

.887

-.157

-.958

.343

a. Dependent Variable: S150

After multiple regression was done by SPSS, the result obtained is as follows:

•

The regression model is not significant.

•

Quality and Service satisfaction will not have any significant impact on consumer decision, if the prices go up by 50%.

Variables Entered/Removedb

Model

Variables Entered

1

SEXa

Variables Removed

Method

Enter

a. All requested variables entered. b. Dependent variable: S150

Model summary

Model

R

R square

Adjusted R


Std error of Page 37

Square

.183a

1

.034

.013

the estimat e .5294

a. Predictors: (Constant),SATS,SATQ

Anovab

Model

Sum of Squars

df

Mean Square

F

Sig.

1 Regression

.458

1

.458

1.634

.207a

Residual

13.175

47

.280

Total

13.633

48

a. Predictors: : (Constant),SEX b. Dependent variable: S150

Coefficientsa


Page 38

Model

Unstandardized Coefficients

Standardized

t

Sig.

Coeffic ient B 1

Std. Error

(Constant)

1.886

.227

SEX

-.210

.164

Beta

-.183

8.299

.000

-1.278

.207

a. Dependent Variable: S150

Gender and buying decision are not significant according to SPSS analysis.

FINDINGS

According to the survey: •

Consumer choice/preference depends on income and gender.


Page 39

•

Quality and service satisfaction does not impact consumers’ decision while buying newspaper.

•

Price plays a huge part while buying decisions are made by the consumer.

•

Most of the consumers are satisfied with the service provided by the newspaper companies.

•

80% of the consumers are satisfied with the quality of the newspaper.

•

About 74% consumers prefer to buy in a subscription based pricing model.

•

Consumers do not have language preference while buying newspaper.

Discussion

Logic behind the Finding We have already divided the income of consumers into 4 different categories.


Page 40

•

In the discussed, income range A (5000-25000) category, falls perfect with 24 consumers who are young in the industry or retired personals. The income range is low but preference wise the tendency to gather knowledge is more for the young and retired persons who are above 60 yrs of age. The young consumers are energetic and have fresh mind and has a regular reading habit. Whereas retired people has less work and more leisure time to spent which they utilize by reading newspap ers.

•

In the income range B (25100-45000) category are middle level executives don’t get ample of time to spent at home due to work pressure. The middle level executives generally read newspaper which is supplied in their own office desk or what they get in the client places. News from internet can be a substitute for these middle level executives to save time.

•

Quality and Service do not impress consumer’s discussion as they are assumed to be good enough but depends upon the price they pay for the product. Reading a newspaper is a kind of addiction of gaining knowledge and daily updates because of its quality of news. Consumers generally get their newspaper by early morning which is supplied by the newspaper vendors. They have a tendency to read it while having their morning tea or breakfast. A consumer does not change his/her newspaper brand because of service. Rather practically changes the vendor who supplies the daily newspaper due to lack of service. If the price of the consumer’s newspaper brand goes beyond limit of afford, then he/she might change the brand in this situation. Very negligible amount of consumers are dissatisfied by the service provided.

•

Subscription based pricing model is much preferred by the consumers then stand alone pricing. Subscription based pricing is much cheaper and affordable compared to standalone based pricing model.

•

Consumers do not have language preferences while buying newspaper but more depends on the quality of the news printed on the daily basis. The logic behind this goes back to the reading habits and preferences which are already mentioned.

•

Gender differentiate the reading habits as female generally likes cookery section, decoration, shopping information, short stories, zodiac columns and movie gossips etc. while male are more prone to politics, stock market updates, major accidental news, sports news etc. So the logic behind reading a newspaper brand is also dependent upon topics covered by that particular newspaper.


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Conclusion

At the end of the Summer Internship Project the ultimate understanding what I got during these two months, that this has been a life time opportunity and a great learning experience for me. Regarding the report after all the data analysis work I understood that the newspaper pricing models which are discussed in the report has a steady impact on reader’s choices/preferences. Consumers prefer buying newspaper in subscription mode as it becomes affordable, cheaper and with good amount of discounted rate. Consumption pattern differs between male and female Newspaper Pricing Model: It’s impact on Reader’s Choice

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because of the quality of the contents covered. Young executives and retired personals are the most serious readers. While the middle and upper level executives have different preferences or buying pattern. With quality and service satisfaction will not have any significant impact on buying pattern of consumers if the price goes up by 50%. But with 25% of increase consumers will continue their existing newspaper. So with affordable price consumers will continue buying their favorite brand till the new price revision impacts the buying decision of the consumer.

Limitations and future scope of study

The limitation of the report: •

The sample size can be increased in future

•

Bias decision of consumers can have a hugely impact on the research work.

•

Consumers who are not interested to give their demographic details like income can have a impact on the research work.

•

Data collection of consumers falling under C or D income category can be increased subsequently to get a better view of their preferences.


Page 43

•

All customers did not respond to our survey.

•

The collected samples are based on posh localities of South Kolkata who are well settled but the consumers who live in the outskirts or suburbs can give a brighter view of preferences.

In future the scope of the study can be done in a better way by exploiting the limitations to get a better view.

References

Websites:

www.wikipedia.com www.indiatimes.com www.allstats.com www.timesofindia.com


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Books: Statistical Tools for Managers, D.P. Apte

Appendix

Questionnaire used for conducting survey:

Dear Sir/Madam,


Page 45

I am a PGDM student working on my summer internship project. This data collection is being done purely for academic purpose only and your responses will be treated in strict confidentiality.

Thank you very much for your time.

Tick in the following according to your newspaper consumption and reading habits:

1) Which newspapers do you buy?

a) Telegraph b) Anandabazar Patrika c) Times of India d) Bartaman e) Aaj- Kaal f)

Any others, please mention ………………….

2) How do you buy your newspapers?

a) Stand-alone pricing b) Subscription pricing c) Any others ways

3) Are you satisfied with the quality of the newspaper you read?

1) Very dissatisfied 2) Dissatisfied 3) Neutral 4) Satisfied 5) Very satisfied

4) Are you satisfied with the price you pay for the newspaper?


5) How much are you satisfied by the service provided by your newspaper brand? Newspaper Pricing Model: It’s impact on Reader’s Choice

Page 46


6) If the current price of your newspaper is increased by 25%, will you continue reading your existing newspaper?

a) Yes

b) No

7) If the current price of your newspaper is increases by 50%, will you continue reading your existing newspaper?

a) Yes

b) No

8) Suppose there is an increase in price on both of your favorite newspapers from the current level, which one will you like to drop /stop taking the newspaper.

a) English Paper

b) Bengali paper

9) Customer Details:

Name: ………………………………………………………………………………………… Address: …………………………………………………………………................................ …………………..……………………………………………………Pin:……….………….. Telephone:……………………………………..……Mobile No:……………………………. Occupation:…………………………………………....Income:………..………………….… Age:………………………………………Sex:…………………..…………………………... Newspaper Pricing Model: It’s impact on Reader’s Choice

Page 47

49462388 Times of India Pricing Strategies

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