Ei Samay Case 193f6

BUSINESS CASE ANALYSIS FINAL REPORT GROUP 13 Aayush Goel – 0005/52 Aditya Lakshay – 0018/52 Nikhil Maladi – 0214/52 Anmol Jain – 0073/52 Ankur Jain – 0069/52

CASE TOPIC Launch of Ei Samay newspaper in Rest of Bengal (Bardhaman, Durgapur, Asansol, Barrackpore, and Chandannagar) markets to increase local to local ad revenue. SIGNIFICANCE FOR COMPANY The problem basically deals with launching the newspaper ES in rest of Bengal Markets. As a newspaper is the fastest moving FMCG product with a shelf life of a few hours, it is extremely important for the company to plan and derive maximum revenue from its product. Proper planning for the launch would involve estimating the population in the target audience segment based on income, age and SEC classification. This is an important marketing problem as the reach of the newspaper would help ES to appropriately price its ments and ensure higher offtake of its advertising inventory. As an r and a FMCG company, it is important for ES to ensure that it satisfies the expectation of its delighters so that they can spread word about the product and increase consumption. It is also important to gauge the expectations of the non-delighters or the fence sitters and look into the possibility of serving better content to them without compromising the brand image and persona. It may be possible to increase readership by introducing a gossip column etc. but such a move may thwart the delighters and make them go away from reading ES. Classifying the target segment is also important so as to sell the advertising inventory to the right set of rs, which will lead to immense value generation for both rs and s alike. Also, marketing to the right set of s and defining our product keeping in mind this classification is also important to thwart competition from ABP and Bartaman which compete in the same market for the same set of s. Although there are some defined perception differences between the three newspapers, it is important for all three of them to properly position themselves and capture their core markets first. As an entrant, it is even more important for ES to do so as this would give it a core readership base to cater to and reduce all risks of financial loss. Positioning itself to be the best newspaper for SEC A/B,6-34 yr old youth would also strengthen ES’s bid to capture such consumers from the other

newspapers like ABP and Bartaman, eventually contributing to higher revenues and profitability. Also, growth to other areas of Bengal is very important for a newspaper like ES, which has positioned itself well in the Kolkata market. As with any other organization, horizontal expansion is a key to long term growth. Also, it can easily capture the similar target segment in ROB areas without much effort into the news part of the newspaper. Sure, it would have to get more local ments and content into its fold, this cost of localization would pay for itself by the increased revenues from the expansion. EXISTING INDUSTRY SCENARIO Traditionally, the readership of dailies in West Bengal has been dominated by the vernacular print with mass readership from the British period. Over the decades, vernacular print has become an integral part of all classes of the society and has shaped the thinking of the general populace. The print media in West Bengal is currently estimated to be INR 1450 crores. Of this, the vernacular print media has the larger share at INR 888 crores with an annual growth rate of 10%. In comparison, the English print media stands at around INR 562 crores with an annual growth of 9%. The Bengali language newspaper industry is highly fragmented. At present, eight newspapers jostle for existence in this market, with Ananda Bazaar Patrika being the clear leader. The others include Bartaman, Sangbad Pratidin, Aajkaal, Uttar Banga Sambad, Ek Din, Ganashakti and Ei Samoy. ABP which is the dominant leader in Bengal has a daily readership base of around 60 lakhs. To put things into perspective, these are the average qualifying sales numbers (Jul – Dec 2015) of the top three players as recorded by the Audit Bureau of Circulations. Ananda Bazar Patrika Bartaman Sangbad Pratidin

1117927 622907 254222

Given the changing social structure and literacy rates, the vernacular print media is adopting itself to maintain the slice of the pie by shifting their focus towards the youth. This time-stressed yet challenging generation forms a large and attractive segment. The industry is also driving over a perception that today only a small fraction of the readers between the age brackets of 15- 35 years can read Bengali. These factors have led to innovations around content and packaging to reach out to these aspirational and vibrant readers Both ABP and the Times group have launched youth focused Bengali dailies, E Bela and Ei Samay respectively. In the past decade, increasing section of the population has been gradually exposed to English at a grassroot level. Coupled with attractive subscription rates, English dailies have been able to break down barriers and make encouraging inroads as a 2nd paper in the households, especially in Kolkata. However, English dailies in West Bengal still command circulation and ment rates which are lower than the leading vernacular dailies.

Coverage of Bengali dailies amongst the SEC - A population aged less than 30 years is higher than that of English dailies in West Bengal. This disparity is evident even in the population aged above 30 years. Given its much broader reach, vernacular print media enjoys a larger share of advertising pie in Kolkata, as well as rest of West Bengal. As brands look to tap markets beyond Kolkata, advertising revenue for Bengali dailies at district level has witnessed growth even as high as 40% , although on a much smaller base. The growth rate in English dailies, however, from markets beyond Kolkata has perceived to be lower, since Bengali dailies are vastly more popular in rest of West Bengal than their English counterparts. While the circulation of English dailies is growing at around 7% CAGR. There has been a visible stagnation of readership of vernacular print media, with slight declines in some districts. But the spate of new launches is expected to change this as they expand beyond Kolkata and attract new segments of readers into their folds. It is perceived in the industry that new launches, such as E Bela and Ei Samay, are likely to alter the dynamics of the vernacular dailies scenario in West Bengal over the coming years. The readership trends are also expected to change in the coming years with the proliferation of consuming news through internet and TV. To stay relevant in the future the dailies are increasingly moving to provide views and counter views rather than a narrative of the incidents. Supplements related to entertainment and travel are increasingly gaining importance and leading to stickiness to that newspaper. For instance “Robbar” published by “Sangband Pratidin” has led to increase in sales of the latter. Ei Samay Sangbadpatra is a publication from The Times Group and is said to be a challenge to the market leader ABP. The newspaper has been doing well in Bengali newspaper market in Kolkata. The brand reaches to more than 6 lakhs readers and has gained fair amount of popularity among them and has also got a population of interested readers in nearby districts. With a 15% increase in ment revenue growth in FY15, Ei Samay is looking forward to extend its reach in the major cities in West Bengal with major focus on Barrackpore, Chandannagar and Burdwan. The introductory price of this newspaper was ₹1 per copy. This newspaper targets SEC A and A+, 20- to 35-year-old Bengalis. From April 2013, it has revised its price down to Rs. 2.50 from Mon-Fri and Rs.3 on Sat-Sun from its earlier price of Rs.4 & Rs.5 respectively. Although it has been able to eat up some circulation from Bartaman in Kolkata but it lacks a strong presence in the districts. It is also not available in North Bengal. After its launch the established dailies like Bartaman & Sangbad Pratidin have also upped their ante by including more pages and sections. STRATEGIC GOAL The Strategic Goal of the Times of India program is to launch Ei Samay into Rest of Bengal markets such as Barrackpore, Chandannagar, Bardhaman, Durgapur etc. so as to – 

Tap into the lucrative vernacular advertising market in Tier-II and Tier-III cities and increase local to local ad revenue



Gain market share in the Bengali newspaper market so as to become perceptual number 2 and pose a challenge to the dominant daily, Anandabazar Patrika circulated by the ABP group. This will ensure continued dominance of TOI led dailies in other regional markets such as Maharashtra.

The Bengali newspaper market is a highly saturated market with 8 newspapers [1] currently fighting for market share. However, with a CAGR of 10% in the vernacular market and 5% in English dailies, the total print market in West Bengal is expected to reach upto INR 1450 crore. Advertising spend in the state is also expected to grow by a CAGR of 25% [2] to reach INR 1900 crore in 2016. With such a high growth in subscription and advertising, the TOI group looks upon West Bengal as a viable market to expand. It is with this mindset in mind, that the TOI group is now looking to launch Ei Samay into Rest of Bengal markets. The district level markets are relatively untapped, according to Mr. Supriyo Sinha, VP – Anandabazar Patrika and Ebela [3], with only 16-20% people who can read Bengali actually subscribing newspapers. With the advent of digital subscriptions and penetration of smartphones and mobile data in Tier-II and Tier-III locations, high price points of physical newspapers would no longer be an issue for populations in these areas. Also, vernacular dailies would be an appropriate medium for local businesses in these areas as they would target only the local population, thereby making local advertising spend more effective. Rest of Bengal market is, therefore, a relatively unsaturated and geared on expansion lucrative market, expansion into which would help the TOI group achieve its strategic goals. ACHIEVING THE STRATEGIC GOALS To achieve their strategic goals, Ei Samay need to broadly cover the following two points in their agenda – 

 

Expand their market share in Rest of Bengal markets by gaining more subscriptions to Ei Samay – advertising revenues will flow according to perceived popularity of daily by rs, which is directly dependent on number of subscriptions. Expand their distribution and retail network to cater to new subscriptions. Optimize advertising mix in order to gain maximum revenues

Out of the above, it is the first one which is a marketing problem. The second one is an operations problem and will also require significant amount of analytics in order to determine the optimal locations of distribution warehouses and retailers so as to minimize cost while providing accessibility to all potential subscribers. This problem will be dealt with briefly, however for the purpose of the interim report, the focus would be on the first and third problem.     Expanding the market share

In order to expand the market share, TOI and Ei Samay group need to do the following analysis – o

It will neither be practical nor cost effective for Ei Samay to target each and every reader and customer group with their new offering since many of these customers will be deeply entrenched and unwilling to switch over to a new offering. Hence, the first step for TOI and Ei Samay is to identify their target audience according to consumer readership profiles and demographics.

o

Once the target audience is defined, it will be necessary for Ei Samay to determine appropriate product mix in order to cater to the interests of as many sub-segments in their target audience as possible. This will also be decided on the basis of genres which TOI and Ei Samay feels are their strengths and weaknesses.

o

According to the IMRB Survey 2015[4], Brand personality measurements indicate that all segments of people are able to associate much more closely to ABP than to ET. For this to change, appropriate brand communication has to be designed which can cater to all sub-segments of the target population.

Optimizing advertising revenues Based on product mix, target segment catered to and their delighter genres and revenues per space garnered from various categories of rs, an optimization analysis will be run which can provide Ei Samay the appropriate amount of space to be given to each category for a fixed portion of total newspaper space given to advertising, in order to maximize revenues. The aim of these analyses would help to achieve the strategic goals as listed above – either by capturing untapped population (if any in the target audience) or stealing customers from incumbents by offering them a better product mix and brand proposition. Just like ABB increasing its market share in the face of powerful incumbents, Ei Samay, through these analyses and implementation of the same, would finally aim to reach number 2 by increasing market share and providing a significant challenge to ABP. This would also help in increasing vernacular advertising revenue. DATA REQUIREMENTS The following data sources and the data they provide have been identified; they have been listed along with status of the data collection/data request – Data Type

Data Source

Status of data

Customer Demographic and Readership data – Reader classification, Gender, SEC, Income, Occupation Reader Surveys – Delighter genres, Satisfaction scores, Competitor strengths, Brand recall, Brand loyalty Advertising data – Advertising volume according to category and revenues from each category – in Ei Samay and other competitors

TAM India data, India Readership Survey, Types of reader profiles

collection Collected. TAM India Data – To be collected

IMRB Survey 2015, Survey data from in Ei Samay, Kolkata, Personally conducted surveys Adex Data

IMRB Survey – collected, other surveys to be collected Collected

All of these data are static for the purpose of our analysis since we need past data for the purpose of analysing appropriate target audience and product mix at launch. In case, we need to repeat this analysis year after year, the data acquires a semi-dynamic character since readership and demographics are changing, however we will be treating data collected so far as static. Adex data generally comes in a database which incorporates regions all over India, hence the database will have to be appropriately filtered in order to get relevant data for Rest of Bengal markets. It will also have to be cleaned since there are some gaps in the database where volume or revenue data is missing. The rest of the databases are in a format which is ready for analysis. ANALYSIS OF PROBLEMS PROBLEM 1: IDENTIFICATION OF TARGET SEGMENT AND PRODUCT MIX PROBLEM DESCRIPTION A major part of the problem concerning launch of Ei Samay market is the identification of the subscribers of the Ei Samay newspaper and making a product mix in order to cater to as many people as possible. Subscribers of a newspaper in a particular region are partial to some particular genres be it sports, national news, business, Page 3 articles etc. which are referred to as delighter genres for the particular sub-segment. The choices of delighter genres are in turn dependent upon the demographic data of the subsegment: education, age, income, occupation etc. TOI can create any product mix of genres and it would cater to people in different sub-segments. However, these people would be highly diffused and it would not be possible for TOI to distribute and retail to all these people. What is important for TOI is to cluster people according to location and then segment people in these locations according to demographics and genres decided in order to decide product mix according to people in a location. Hence, what TOI should expect to get out of this analysis is an idea of locations, sub-segments of people in these locations according to demographics and

required genres and finally, TOI should be able to choose its target segments and decide on product mix for them. DATA ANALYTICS TECHNIQUE The problem as described above is a segmentation problem and the technique that we would be utilizing in order to solve the above is a Hierarchical clustering in order to divide the data points that we have into discrete clusters in which intra-cluster distance is minimized and inter-cluster distance is maximized. Location variables would be given significantly more weightage in the clustering algorithm. We would be utilizing clustering algorithms already provided by software such as Cluster 3.0 or IBM SPSS. DATA REQUIREMENTS In order to solve this problem, TOI requires a survey of potential subscribers in many different locations. The data that would be got from the population surveyed would be –   

Location of the surveyed - Region and sub-region (District) Demographics of the surveyed - Age, Income bracket (Low, middle, high) and Education bracket (Till Class X, 10+2, Graduate) Ranking of genres in decreasing order of importance to the surveyed - For our case, we have taken the number of possible genres to be 4 and that TOI can take 2 genres in their product mix.

TOI needs to do this survey in the Rest of Bengal markets where it plans to launch Ei Samay. Since it was not possible for us to do this extensive survey, in order to demonstrate the solution, we have constructed a small sample of people in and nearby the institute as our survey results. TOI can conduct a similar analysis as ours’ in order to determine the target population and the product mix. SOLUTION    

Gather data in the file named as ‘Survey Data.xls’. Run hierarchical clustering using Ward’s method to obtain linkage on the data using IBM SPSS 19. Store agglomeration schedule and dendogram to analyse clusters formed. Calculate average of each cluster to obtain profile for mean cluster in the range.

The agglomeration schedule is as follows –

Agglomeration Schedule Cluster Combined Stage

Cluster 1

Stage Cluster First Appears

Cluster 2

Coefficients

Cluster 1

Cluster 2

Next Stage

1

1

33

.500

0

0

4

2

3

26

1.000

0

0

16

3

5

27

2.000

0

0

22

4

1

23

3.500

1

0

12

5

6

17

5.000

0

0

12

6

2

20

7.000

0

0

25

7

11

19

9.000

0

0

26

8

9

34

11.500

0

0

23

9

4

31

14.000

0

0

17

10

10

22

16.500

0

0

24

11

7

24

21.000

0

0

28

12

1

6

25.900

4

5

27

13

15

21

30.900

0

0

21

14

14

29

36.900

0

0

22

15

8

18

42.900

0

0

20

16

3

16

50.400

2

0

23

17

4

13

57.900

9

0

29

18

12

32

66.400

0

0

31

19

28

30

75.400

0

0

31

20

8

25

86.067

15

0

25

21

15

35

97.067

13

0

24

22

5

14

111.067

3

14

26

23

3

9

128.567

16

8

28

24

10

15

150.867

10

21

27

On analysing the agglomeration schedule, we realize that the difference between the coefficients keeps on getting progressively smaller as we go up. This leads us to the optimal number of clusters to be considered which is decided as the point where difference between coefficients is insignificant compared to earlier differences. Based on the same, we were able to identify the optimal number of clusters as 3 or 4. Manually inspecting the dendogram, we have chosen 4 clusters as the optimal number of clusters. The dendogram, which has been created by IBM SPSS, is as below –

We can, using the same, find out which data entries are to be captured in which cluster. Marking the data entries accordingly, we can calculate mean profile and top 2 genres of the clusters as follows –

Cluster Numbe r Cluster 1 Cluster 2

Location

Cluster 3 Cluster 4

Joka and Behala Behala

Age(year s) 23

Income Class

Educatio n

Top 2 Genres

Likely Description

Middle

Graduat es Class X

National and Sports Local and Sports

Graduat es and Class XII Class X and Class XII

National and Business

Students in IIMC Low income Daily wage workers in Behala Business Class in Behala Senior citizens

43

Low

Behala

33

Middle

Behala and Thakurpu kur

60

Low

Local and National/Spor ts

PROBLEM 2: IDENTIFICATION OF OPTIMAL ADVERTISING MIX/PRICING PROBLEM DESCRIPTION Since the aim of the launch of Ei Samay newspaper in Rest of Bengal market is finally to gain additional revenues, hence maximization of advertising revenues forms a critical part of the analysis. Revenue maximization comprises of two subproblems: maximization of newspaper subscriptions in target audience and maximization of advertising revenue/advertising space for given advertising space in one copy of a newspaper. We have already provided a description and solution for the first sub-problem earlier, our major aim now is to provide a description of the second sub-problem. Typical advertising in a newspaper corresponds to newspapers selling ment space to agencies/retailers in many different categories based upon ‘card rates’ or rates per unit space occupied by the retailer. Card rates differ according to the category of retailer depending upon the relevance of the category to the newspaper distribution locations. Hence, depending upon locations of distribution and relevance of different retail categories, determining the advertising mix in of retail categories to sell ads to can take two different forms – Determining Optimal Advertising Mix: Given pre-determined card rates for various retail categories based on either internal TOI data or competitor benchmarking and the advertising space available in the newspaper, the aim is to achieve the maximum possible advertising revenue by allocating a certain percentage of space to certain categories. The problem can also be complicated by introducing the following constraints –

o o

TOI must have a minimum number of different categories so as to cater to as many relevant categories as possible according to the distribution locations. Newspapers generally have advertising spaces in certain forms and areas such as 6x1 Inch rectangles or 3x2 Inch rectangles or even half/full page ments. Allocation may be decided based upon how much space retailer is willing to purchase depending on his cost considerations.

Determining Optimal Advertising Prices: Given optimal advertising mix determined above based on present card rates of TOI/competitor, if TOI is not able to meet its advertising revenue target planned through Ei Samay, then TOI may need to optimize its card rates so as to meet its targets. Hence, the second form the problem can take is to determine increase in card rates of some categories based on retailer cost considerations and relevance of retail category to market so as to meet their advertising revenue target through Ei Samay. DATA ANALYTICS TECHNIQUE The technique that we plan to apply in order to solve this problem is a Constrained Optimization technique that maximizes a certain objective function based on certain constraints. Here the objective function would be total number of revenues, constraints are already listed above and the optimization exercise would solve for retailers selected, space allocated and card rates for a target revenue figure. The exercise would be solved in Excel using the Solver function. DATA REQUIREMENTS Following are the data requirements in order to solve this problem – 

  

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Advertising space available in one copy of Ei Samay along with form and area of different spaces - This is a management decision to be taken by TOI, for our purposes we have used a possible data set which can be modified by TOI. Target revenues to be obtained from advertising in Ei Samay - This is a management decision to be taken by TOI, for our purposes we have used a possible data set which can be modified by TOI. Card rates of TOI and benchmarked competitors used in past for different categories of retailers - This is available to us through Adex data. Relevant ment categories for target segment subscribers - This can be obtained by TOI through a survey of target segment. For our case, we have used a possible sample to determine categories to be included at a minimum in order to demonstrate the solution. r categories and maximum payment capability of rs This can be obtained from the rs themselves when they come to in Ei Samay. Again, a possible sample has been constructed by us in order to demonstrate the solution.

SOLUTION The steps that we have employed in order to solve the problem are    

Filtered out Adex data to capture Siliguri advertising data which is closed to Rest of Bengal vernacular advertising market. Sanitized filtered out data from above so as to find out average competitor card rates for various categories. Set up data required and calculations and constraints in separate Excel sheet for Solver Ran Solver to optimize Advertising revenues. (Simplex LP optimization method)

Till this step we were able to solve for which rs should be chosen to in the particular copy of Ei Samay. 

If the maximized revenues fell short of target revenues, we then set up a separate Excel sheet after copying rs selected by previous algorithm This was done in order to bring advertising revenues to target revenues while minimizing the number of card rates changed and constraining card rate change to maximum payment capability of r. This was again done through Solver. (Evolutionary optimization method)

Based on this we were able to obtain the card rate changes and the final card rates to be charged from various categories of rs. The entire analysis and solution, along with the data utilized and constructed sample, has been captured in the Excel sheet named as ‘Optimization problem.xls’. Optimization algorithms must be run in the order mentioned above. PROBLEM 3: SUPPLEMENT TO DAILY NEWSPAPER PROBLEM DESCRIPTION Daily newspapers have been the norm of the day in India. Be it English media or vernacular media, daily newspapers forms a major chunk of how news is absorbed in India. The daily newspapers contain the events around the world and the editorial section which depicts the views of well known personalities. Increasingly, people are not satisfied with the daily newspapers and want to know about more diverse topics like health, travel and leisure, matrimonial section, entertainment, etc…To cater to this section, many newspapers have introduced supplements which is an additional paper usually given on Sundays. Several vernacular newspapers have also not missed the bus and are introducing supplements. Therefore, a question arises as to whether our newspaper Ei Samay should also do the same to keep hold of existing customers and attract new customers.

ANALYSIS Analysis is to be performed along three main questions: 

Supplement Frequency and Theme – A decision regarding the number of supplements we will have throughout the week and the theme for each of them is central to any discussion. There are several themes out of which we can choose the supplement. Some of the popular ones currently present in English and vernacular medium are Entertainment, Children’s section, Food and Lifestyle, Health and Yoga, Culture and Arts, Spirituality, Real Estate, Matrimonial, Science and Technology, Fashion and Decoration, Sports, Automobile, mixture of all, etc…Out of the existing supplements, majority are present for entertainment news regarding Bollywood, TV shows and life of celebrities. Across vernacular press, lifestyle (e.g. travel, food, and health) is becoming increasingly successful in of supplements, outside the daily news. Personal finance is another topic, which has gained popularity, especially amongst the age group of 35-40 years. Interestingly, there is a divergence in of focus on the nature of content regarding Education and Jobs sectors. A large portion of English daily readers, for instance, has migrated to internet for outright information on ission, vacancies, etc. The situation is typical of Education and Job supplements, which has led to a decrease in their readership. But for vernacular dailies, this trend is yet to be seen, ABP’s ‘Prastuti’ continues to be perceived as a strong platform.



Revenue vs Expenditure – The increased ad revenues and circulation revenues would boost the topline but the supplements are usually fully coloured pages with expert opinion. It has been observed that the average number of pages in the supplement is 8(6 colour + 2 B/W). So based on the known average ad rates for Ei Samay and the price to make the newspapers we can price the supplement accordingly. The introduction of supplements has led to increase in offtake on normal days. To calculate the increase in revenues attributable to this reason, we can approximate it with the industry average (rise in subscription after introduction of a supplement for the industry peers). There are other intangible benefits associated with introducing a supplement like the goodwill of the authors and increased brand image for bringing out a quality paper. Regional newspapers mostly have 4-8 pages in colour and rest in B/W, though supplements in most of the newspapers are produced in colour. The reason behind thisis that ‘ad-’ from rs come in plenty to all colour pages more than the B/W. The average number of pages being 16-24 for the main newspaper with supplements going to as high as 76. Some of the newspapers reveal multiple editions published serving

different cities, and such number going as high as 63 (Dainik Bhaskar/Divya Bhaskar covering 13 states in four languages). Supplements on topics like real estate follow industry cycles, there have been a lot of tactical supplements, which have started doing the rounds. For instance, a special supplement on F1 was launched around the Formula 1 Grand Prix in the Budh International Circuit. The cost of production of these is lower due to use of syndicated content. But they find favor with specific readers, as well as, rs who want to target this particular niche. rs often earmark budgets around such events as these tactical supplements actually help them in reaching the relevant readers. These kind of supplements thus essentially are very inexpensive for Ei Samay but would bring in loyal customers. 

Competitive Benchmarking – Any analysis is incomplete without understanding the competition and their historical performance in making supplements. ‘Robbar’ , a weekly magazine that comes with the newspaper ‘Sangbad Protidin’, published every Sunday and edited by Rituparno Ghosh and Anindya Chattopaddhyay has been attributed large increase in uptake of the Sunday edition of the newspaper. Its popularity acts as an invitation to subscribe to the daily for the rest of the week. A basic correlation plot can be drawn which will show the increase in sales with the introduction of supplements for the competitive peers. Supplements like T2 (supplement of The Telegraph), is sought after amongst the young readership in the age group of 15-35 years. Entertainment news seems to be the theme for readers as print has to compete for attention with many other forms of media.

DATA REQUIREMENTS 







To conduct a more in depth analysis to ascertain the most preferred theme and the optimum frequency, we need to conduct a small survey to understand the consumer preferences. The average ad rates for the different industries and in different sections of the newspaper are required to find the ad-revenue from the supplement. The costs incurred in publishing the supplement has many associated costs like the manufacturing costs, paying writers, experts, etc…We need approximations for each of the parameters involved in evaluating the above costs. The sales data of the previous years for each of the top newspapers and tabulating the corresponding increase yoy would help us in finding the impact of supplements. The data for the previous years can be accessed from the Audit Bureau of Circulations site.

PROBLEM 4: OPTIMAL LOCATIONS FOR DISTRIBUTION AND RETAIL STORES BASED ON CUSTOMER LOCATIONS As we have clearly defined our customer segment as the Sec A, 26-34 year old male for our first launch in rest of Bengal market, we will try to distribute an optimum load across the distribution outlets we set up for our newspaper in small towns. We plan to open one common distribution centre and furthermore, delivery micro-entrepreneurs who will be responsible for last-mile delivery of As an example, affluent neighbourhoods would be our first target and we will try to have a distribution outlet nearby so as to deliver the newspaper in the right manner. Also, we can look at the neighbourhoods where a cluster of youth lives on rental basis. These would be working in companies, banks etc and would be an ideal target for our product. This data can be obtained by going through local property records and registrar offices. Another offline distribution strategy can be to target traffic signals at office time peak hours when most of the office-goers are out in the morning. This can be an excellent advertising strategy as well. We can use these stops to have consumers sample our newspaper by giving it free in the initial days. Once we have the data for the number of subscribers from each region and subregion, we can plan our distribution routes accordingly. The following data sources would be useful in our analysis 

Google Maps traffic data to indicate time taken to travel a particular distance at all possible time slots for newspaper delivery

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Heat maps for subscribers in a particular region can be generated based on subscription data. We may have to feed this information electronically into the system while taking orders.



Location data for percolation of small grocery shops/ retail outlets which can act as sub-delivery centre.

In addition, we can use any route planning software with this information to plan a delivery run based on this information. This is a classic transportation problem and there are many excel packages and other proprietary tools available in the market to process this information and prepare optimum delivery routes. Also, clustering algorithms can be deployed to cluster the s based on vectors of distance and time, to define optimum hotspot areas. In such clusters, local marketing and leaflet inserts can be employed to increase advertising revenues.

One of the major pain points in newspaper delivery is late delivery of newspapers. We will try to create micro-entrepreneurs who will own delivery in a particular region/ locality and provide them with the necessary data so as to deploy the delivery personnel in an efficient manner. This data as well as data obtained from our Kolkata operations can be used to create service level benchmarks. This will enable the vendors to hire the optimum delivery staff to fulfil this need.

PROBLEM 5: DIGITAL FORMAT FOR NEWSPAPERS This is a new business idea with a separate cost structure and separate revenue source. Planning for digital delivery of newspapers or a subscription model for enews will have to be done separately. While e-newspaper has the added advantage of convenience and real-time delivery of important news updates, there is a missing element of tangibility which makes the consumers reluctant to opt for this service. Globally, there has been a mammoth increase in digital newspaper subscriptions. Without a doubt, one of the best examples of this strength is The New York Times, internationally acclaimed for the quality of its journalism. Major revenue lines for the The New York Times and primarily print ads fell by almost two-thirds in 14 years. Ad revenue fell by 74% while digital media competitors crushed revenues from classified ads. Paid circulation revenue (single sales and subscriptions) did grow during this time: 10% Observation of disruptions in this industry suggests a business model in which news companies are able to produce quality journalism with independence and keep a critical eye on powerful institutions. With some examples and market data, our research suggests the formulation of a strategic business model, detailing how it is possible to run advertising in this new scenario — which is dominated by giants, with the remainder dispersed among many small companies, lacking a large advertising network comprising quality publications. There are various cost and revenue sources as highlighted below. 

Paywalls are part of the solution. By giving quality content real-time online, with editorials and journalism independent and much crisper than the rival free news websites, it is possible to charge a for our services.

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Advertising in the digital format is much more targeted and refined as compared to print- format advertising. By selling ad space online and targeting s based on characteristics like demographics, age information etc, it is possible to increase the ad revenues much more than what was possible in the print mode.

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Another revenue source can be a freemium/ trial model. It has been observed that there is a direct correlation between visits on the website and actual newspaper sales the next day/week. Hence, the e-newspaper can offer some free exclusive content online, prompting the reader to purchase either an offline or online access to the product.

Major costs with a digital model would be the content production and IT teams which would be responsible for real-time maintenance of website as well as marketing the newspaper online through channels like ads,google adwords, email marketing etc. The data required for the same would be as follows

Information from cookies embedded into the customer’s computer so as to understand his profile and serve him targeted ads.

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Data on internet usage in India can be taken from TRAI and local ISPs to see potential high internet usage areas and serve offline ads to them to take up an online subscription.

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SEC A/B classification data that can be derived by tracking ’s browsing history/shopping cart updates on other e-commerce websites.

Correlation analysis and logistic regression models to predict probability of a free becoming a paying customer will be deployed to have a sense of revenue projections and how/where/when to scale the business.Hence, it is possible to launch an e-newspaper in the rest of Bengal areas as well as in Kolkata and derive superior customer experience as well as higher profits for the company.

REFERENCES [1] http://forbesindia.com/blog/business-strategy/ei-shomoy-or-toi-versus-abp/ [2] http://www.business-standard.com/article/companies/west-bengal-tv-arket-to-grow-at-cagr-of-25-by-2016-112123100089_1.html [3] http://www.impactonnet.com/Tapping-the-potential-of-Tier-II-%26-Tier-IIImarkets?page=2 [4] IMRB Survey 2015

[5] http://ficci.in/spdocument/20230/FICCI_Deloitte_MEBC_East_ %20Report_2012.pdf [6] http://www.auditbureau.org/ [7] https://en.wikipedia.org/wiki/Ei_Samay_Sangbadpatra