Sdm Report on TOI

7/31/2019 Sdm Report on TOI

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OBJECTIVE OF STUDY

To Analyze Sales And Distribution strategy of Times of India To understand Times of India personal selling function To get underline of Distribution/ Channel Management


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INTRODUCTION

The reach and popularity of a newspaper to large extent depends on its distribution network.

Here we have carried out an analysis on delivery and sales management of the Times of India in

order to understand their channel of distribution.In a newspaper organization Like Times of India, there are various factors that determine the

successful operation of the sales and distribution channels. Accordingly, even minor issue in

these operations can adversely affect the newspaper.

A customer may choose a newspaper for various reasons. However, its up to the newspaper

agencies to communicate to the customer that their newspaper can deliver all the values a

customer may look for.

On account of declining circulation with increasing cost per copy, Times of India need to

improve the production and distribution process to compete with other Newspapers like The

Indian Express, The Hindu etc.

Delivery system is vital in newspaper industry provided that it is directly tied to customer

service level. As a result delayed delivery system could hurt sales because newspaper readerespecially subscribe ones expect to have paper outside their doors before leaving for work.

Guaranteed on time delivery and service quality are the main key success factors of newspaper

industry, therefore it gives the company competitive advantages.

Achieving the on time delivery is quite challenging because newspaper wants to delay their

printing as much as possible in order to get the latest news into prints. This gives delivery

department has to work quickly.


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INDIAN NEWSPAPER INDUSTRY A FEW THOUGHT

The Indian Newspaper industry is flourishing, printing the staggering figure of around 22,000

newspapers, of which around 1800 are dailies. Some 4000 are in English and is the most

popular language in Newspaper.

The principle dailies include, The Hindu, published in many cities in north and the south. The

Indian Express is also good. The Times of India comes closely next in terms of readerships.

Bennett Coleman & Co Ltd A Brief

The first edition of Bombay Times and The Journal of Commerce, late to be called The Times

of India was launched in Bombay on 3rd Nov 1838 as a biweekly newspaper. After several

years of change, evolution and growth in the papers character, Bennett Coleman & Co Ltd (the

proprietors of Times of India) was established with the principal objective of publishing

newspapers, journals and magazines.

Today TOI has emerged as a multi edition, multi product organization and a clear leader in

segment it operates. The TOI has emerged as the largest daily of the nation and the second daily

of the world.

After launching in 1838 with J.E. Brennan as its first editor TOI became the daily on Sep 2nd

1850. And on May 15th 1861 it becomes Times of India with Robert Knight as its editor who

later launched the Statesman. In 1982 T.J.Bennett, proprietor/Editor brought F.M. Coleman as

editor from U.K.

In 1946 it was bought by Dalmias and in 1950 the ownwrship was passed onto Sahu Jain who

are the present owner.

Some of the brands owned by Bennett Coleman & co Ltd are:

The Times of India The Economic Times Femina


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Film fare Top Gear Navbharat Times Sandhya Times

Maharashtra Times Times Music Radio Mirchi

It has seven publishing Centers all over India from where newspaper is printed

1. Delhi

2. Kolkata

3. Patna

4. Hyderabad

5. Bombay

6. Chennai

7. Lucknow

Sales Management

1. Sales Planning:

It is the first step in the sales management process Sales planning guides the organization in

achieving its objectives in a systematic manner leading to profitability and success.

In case of newspaper industry plans are formulated keeping in view the overall sales strategy

and objectives of individual organizations. Since circulation is the main thing in the news paper

industry, all the planning is intended to increase the circulation base of newspaper .The main

source of revenue for a newspaper company is the advertisements and they can charge more for

advertisements only if their circulation base is higher. This circulation base is increased by

eating into the competitor's circulation. The head office decides the targets for all branches in

the country and this is communicated to marketing manager of branches across the country. The

marketing manager of the branch then allocates targets for every sales executive in the branch.

The marketing manager asks each sales executive to target a particular segment. Segment can

be hotels, educational institutes, corporate offices, IT companies, students preparing forcompetitive examinations like CAT, XAT etc.


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2. Organizing and Directing Sales efforts:

Most of the newspaper companies hire graduates who are well versed in local languages as

selling newspaper require interacting with vendors and intermediate agencies. They generally

do not hire MBAs or Post Graduates as they are more prone to attrition. The attrition rate is

very high in this industry especially in the second rung companies.

Time Management: Time management is very important as the executives have to visit

morning centers at around 5 to 5.30 a.m. in the morning to meet the vendors to ensure the

timely delivery of newspapers. Morning centers are places where all the newspapers are

dropped and vendors come here to collect newspapers for their locality. Most of the activities

happen between 3.30 a.m to 5.30 a.m. Within this short span they have to meet the vendors and

ensure they are regularly supplying the newspapers.

3. On the job training:

The sales force is briefed about the newspaper and supplements and then they are sent to the

field for training. In this industry the training is mostly on the job where executives have to go

and sell the subscriptions to the customers.

4. Compensation Plan:

Generally combination salary plans are followed in newspaper industry. This type of plan

includes a combination of salary, commission and other type of incentive plans. As sales people

get regular income in the form of monetary incentives, they are continuously motivated and it

also provides sales person with the advantage of both a fixed salary and variable income. Every

executive is given a minimum target to achieve and on exceeding this target they are given an

incentive.

5. Evaluating Sales Force Performance:

The performance of sales force is measured in terms of the number of subscriptions generated

by each sales person. At the end of the month they collate how many subscriptions have been

generated by executives and on the basis of subscriptions generated salary is computed.

Distribution Process of Newspaper Industry

The newspaper sales involve distributing highly perishable products under severe timeconstraints.


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The printed newspapers have to be dispatched to various distributors across the region.Transportation is normally through private contract carriers within local area, public

transport in case of longer distances and through couriers in other cases.

The newspaper distributor has the rights to distribute the newspaper in his area. Therevenue of the newspaper distributor is based on a commission on the sale of every

newspaper. The circulation is normally through salesmen appointed and salaried by the

distributors, who in turn pass it on to hawkers.

Hawkers, vendors and book stall owners are the last link of the supply chain beforenewspaper reaches readers. The hawkers' remuneration is also normally based on the

commission system and is generally the highest in the entire supply chain.

Responsiveness and efficiency play an important role in newspaper distributionchannel. Responsiveness includes supply chain's ability to respond to wide a range of

quantity demanded (due to demand fluctuations) and meet short lead times. On the other

hand efficiency is the cost of making and delivering the newspaper to the readers.

ROLE OF DIFFERENT MEMBERS

Printing pressthe press prints the required units for the day according to the production plan. It takes

the content from the editorial team and print using high capacity advanced press

machine that deliver the product in packaged condition. Transport

the packaged newspaper is transported through contracted trucks and vans to different

distribution location.

Distribution Centrethe distribution centre receives the copies from the transporter and stock it for a short

duration before handing it over to the various vendors and hawkers who source it from

the centre. A centre typically employs three persons. The payment for goods is on daily

basis.


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Vendors and HawkersVendors and Hawkers source their newspaper from the distribution centre and deliver

them to the customer. Vendors are the larger in scale than hawkers and employ delivery

boys. The delivery boys have demarcated regions which they serve. Hawkers are

individuals who do not have established customer and sell at road sides, bus stands etc.They make small quantity purchase

Circulation and readership

Its important to note that circulation and readership are not the same.


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Features of a newspaper

Mind product

Newspapers are basically a mind product as certain emotions go through an individuals

mind while reading a newspaper. It makes the reader think and also has brainstormingsessions with his own self and other readers. Thus he is emotionally attached with it to

Reach a final conclusion to form his opinion.

Home delivered productNewspaper is essentially a home delivered product. Infact in Delhi itself 98.6% of the

newspapers are home delivered and only a mere 2% is sol on the streets. Generally this

small percentage of out of home sales also takes place only when the reader feels the

need to buy a different paper not usually ordered at home, especially st udents with a

variety of need are involved in this purchase.

Most perishable itemNewspaper is the most perishable item as it becomes useless as soon as the reader has

Finished reading it. It s also a waste if not delivered on time and thus proper distribution

of this product is extremely important.

The entire team ensures that it reaches the right place at the time through various

Modes of transport and it happens only once in 2 -3 years that it does not reach on time

Or is not printed properly.

Issues Concerning the Organization and its Distribution


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Channel

On analyzing the interaction of the organization with its distribution network, the customersand marketing decisions the following problems were identified:

contentA newspaper needs to match the readers requirements, especially if the newspaper is targetedin a Capital region, such as targeting Delhi and neighborhood localities. Thus, it not only needsto capture the articles of national interest but also the local interest.

Layout & DesignThe layout and design of a newspaper appeals to the reader as much as the content in it.Hence, special attention must be paid to not only the layout of the newspaper but also the sizeand the quality of the final print. For example, particularly, for the residents of Delhi, the salesare increased by keeping more pages in the newspaper print copy so as to provide higher resalecosts to the reader.

Costs

In a highly competitive industry like newspapers, one of the ways a newspaper can make itselfdifferentiable is by managing the cost to the customer. This includes both the cost of purchasinga print copy of the newspaper as well as the profit from reselling the newspaper.

DistributionNewspaper is a highly perishable good and requires stringent timings to be followed. A delaymay result in the wastage of enormous costs. Hence, newspaper printing press uses a highlytime critical channel for the distribution where the risk of the delay is borne by each participantin the channel as and when the goods are transferred to him/her. Even a slip of a few minutescan create a cascading effect and the value of the newspaper diminishes (because thevendor/hawker will not pick up your newspaper and deliver it, if he is getting late by waiting

for your newspaper to arrive).Profit sharing throughout the distribution channel is also critical. Different newspaper agenciesuse different models for profit sharing, though they are bound by upper limit of commission ateach level by the Audit Bureau of Circulations (ABC). The successful and efficient channel isthe one where all the levels within the channel (namely, the printing press, transport, vendor,distributor, hawker) are committed to the timely delivery of the newspaper. For this, thenewspaper agencies compete for the commission per copy absorbed at each level. Maintainingsuch competitive commission structures is one of the main issues faced by newspaper agenciesin their respective distribution channels.

DISTRIBUTION CHANNEL ADOPTED BY THE TIMES OFINDIA

TOI has three presses in Delhi and surrounding areas:

Sahibabad 1 Sahibabad 2 Times House


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TOI uses three different channels of distribution for newspaper

The first and second channel are shown in figure below and the third channel is shown in the

following page.


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The third channel is:


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Distribution centers:

They are also known as Depots. There are 60 such centers all around Delhi and the numbers

Keep changing. In south Delhi itself there are 18 such centers. The company salesman sells

Newspapers from these centers b/w 4-4:30am only in cash to vendors, retailers etc. These

Centers are mere open roadside areas or balconies outside shops like in Connaught placeEtc. The centers are common for all brands of newspapers like HT, PIONEER etc. Since these

Are open areas no cost as such is incurred on these Depots.

Depot Location is determined by:

No of readers that can be serviced on time Convenience of organization Convenience of vendors

Thus even the competitors newspaper reaches the same place sold by their own salesman

between 4-4:30 am in the morning from where the vendor or the distributor takes different

Brands according to their requirements.

Salesman:

keeps a register with himself in which he notes the name and the number of newspapers

taken by each vendor and generally there is a variation between the distributors or ve ndors

demand everyday. These numbers form the basis of demand for the next day. For instance if

sales in Lodhi road on a particular day is 5000, then he will get 100 -150 extra copies printed

for the next day. Newspapers are never given on credit, thus the money has to reach the

bank the same day. One of the main functions of the salesman is to keep track of thevariation and report extreme variations. Thus when there is a small increase in demand per

vendor it is ignored, incase of a huge increase in demand per vendor the vendor is

questioned as the aim of the company is not just to sell to the vendor but high circulation

leading to increased readership.

However,

if there is a small or big decrease in the demand the company steps in:

To understand the cause for the drop of TOI by the reader Effects of competition on the same Inquiry and Analysis

The team does the analysis by going to the particular areas where the reader s are residingand finding the exact reason for the shift in demand.

Vendors

Common intermediary between readers and all publication houses Their immediate customer He buys on cash daily from TOI Distributes on credit after final packaging to readers Ensures on time delivery Provides brand assortment to readers Crucial link of the channel


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The difference between a small or big vendor is according to the size or area catered by him.

As explained above they take the order from the customers, handle the day -to-day

complaints. This is a very important aspect of this product that the producer h as no personal

involvement with the end consumer. The vendor thus acts as an intermediary between the

company and the customer to deliver the requisite paper on time. Thus if the paper is not

delivered on time the consumer changes the vendor but does not involve the company on theday-to-day basis. This is where the job of the salesman is very important to note the

variation in demand. A vendor may or may not be a distributor.

Plates:

The final news to be printed is written on these plates and then installed into the machine.

Thus its important that this is done on schedule otherwise the entire process is delayed

which is very harmful for company s reputation as timing is the key factor in this industry.

Beat boy:Beat boy is a vendor s employee who actually distributes. A vendor may or may not be a

beat boy. They generally distribute through cycles that can carry around 150 newspapers.

One beat boy takes care of that much area accordingly. Total number of distributors

including the beat boy in Delh i is approximately 20,000.

Feeder Route:

1-Caters to magazine and newspaper retail outlets i.e Cash Sales Point

2-These CSP s are generally located in prime up -market areas

3-Feeder Boys are responsible for delivery, re-feeding, settling accounts, display,

volume increase and unsold collection

4-CSP owners are motivated to give prime display for TOI publications as well as POP

materials

Feeder boy is different from a beat boy as they are company employees hired on a contract

basis to deliver newspapers and magazines directly to non conventional outlets such as

petrol pumps, hotels boutiques etc.

Retailers:

Extension counters:

In the newspaper industry the distribution efficiency is calculated through the timing and

the service factor. Thus to gain an edge over its competitors times of India to provide better

service has a few extension counters for those vendors who are staying very far from the

distribution centres. Thus if such vendors go through the normal route then the newspapers

are delivered a little late in their areas. Thus to have an edge over competitors in that

particular area they have counters from which these few vendors directly collect the papers.


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Company agents:

If a particular vendor has a huge supply then in that case such distributors are made

company s agents and they have to pay an advance of three months. These agents are hired

on commission and the billing is on a monthly basis. For their convenience and better

functioning these agents inturn hire smaller agents.

The important question at this stage arises that how do the seven publishing centres cater

to the whole of India. For instance, Bhopal, Jaipur etc. Are non-publishing centres the

newspapers for which are printed in Delhi. To explain this lets take the example of Bhopal.

Generally for Delhi and surrounding areas news to be printed is finalised by around printing

after which the printing starts till about 4 in the morning. However, if the paper has to reach

Bhopal then the plates for the news to be printed is finalised till about 8pm and the printing

starts immediately. Then the newspapers are loaded on to the 11:30 pm train that reaches

Bhopal by around 7am.

TOI has three editions; the newspapers, which reach Bhopal, will have National instead of

Capital written on it even though a lot of D elhi news is included. However, a few

modifications are made to newspapers reaching other cities i.e. the Delhi times section

(Local Delhi news) is removed and a new section for Bhopal is included. The news for this

section comes online by 8pm to the publi shing centres in Sahibabad from journalist located

in Bhopal.

Thus due the time gap the news printed for Delhi between 8-11pm does not reach Bhopal

the next day. If the distances are extremely huge say Guwhati then the dates are changes,

which means the residents of Guwhati, read one-day-old news i.e. news which is read by

people residing in Del hi on the previous day.

Beat plan of NewspapersThe newspaper industry follows the traditional and conventional method as this is a

completely unorganised sector and thus there is no formal agreement or legal requirement.

Every vendor has a area of his own which he inherits either from his father or purchase at a

value of goodwill from another vendor. If a person wants to be a vendor of newspapers, he

has to buy the business from the old vendor and find out the various areas catered by him.

The old vendor then introduces him to the salesman of that area. However, as mentioned

it s a business that earns certain goodwill over the years.

This good will amount is calculated on the basis of each house where the newspaper is

circulated. Each house has a value of Rs. 300-500 depending upon the area and number of

newspapers subscribed. The newspaper company has nothing to do with the area and the

area belongs to the vendor and they just ensure that its distributed, only when a complaintmade directly to the organization it come forward. It being a product of need the reader

directly instructs the vendor. The same happens in case of magazines however; the

magazines are also brought from shops on a huge scale unlike in the case of the newspaper

where 98% is home delivered.


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Personal selling of Times of India:

Personal presentation done by the firm s sales force for the purpose of making

sales and building customer relationships. Personal selling is paid personal

communication that attempts to inform customers and persuade them to purchaseproducts or services.

Undoubtedly by now you ve figured out that marketing enables both individuals and

organizations to sell products and services to other people to help them satisfy their needs

and wants. At some point in the selling process, personal selling usually becom es involved.

It is the personal selling process that allows marketers the greatest freedom to adjust a

message to satisfy customers information needs. Personal selling allows the marketer or

seller to communicate directly with the prospect or customer and listen to his or her

concerns, answer specific questions, provide additional information, inform, persuade, and

possibly even recommend other products or services.

The personal selling process consists of the following steps:

The selling process of newspapers in India involves various steps like:

1. Prospecting and Evaluation:

This is the stage where potential customers are found and evaluated. It is first necessary to

identify that the potential customer has the willingness, ability and authority to buy the product.

This would involve first generating sales leads. In the case of newspapers customers could be

Financial Institutions, IT employees, students preparing for their CAT examination MBA

students and other institutions like Hotels, Airlines etc. Most of the times when a company oroffices are approached with subscription offer the gatekeepers are encountered who are actually

the receptionists and security guards and they don't have the authority to buy the paper but pose

a challenge to the final sale from happening.

Three types of prospects:

Lead :Name of a person who may be a possible customer.

Prospect:Person who wants or needs the product.

Qualified prospect: Person who

-Wants or needs the product

-Can afford to buy it

-Is the decision make

Lead sources are given as follows:

1-Advertising

2-Coupon

3-Toll-free

4-Trade shows

5-Professional meetings

6-Conferences

7-Lists and directories.8-Cold canvassing in person

9-Telephone canvassing


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10-Networking

11-Referrals

12-Center of influence

2. Pre approach:

In this stage the process of approaching the client is decided. This involves deciding on the

approach establishing objectives of the sales call and preparing for a presentation. We need to

analyze what are the product features in which the customer will be interested and focus on

those during the presentation.

1-Obtaining further information on the prospect

2-Deciding on the best method of approach.

3-Important in international selling (customs dictate protocol).

4-Failure to learn as much as possible about the prospect is unprofessional and can

ruin a sales call.

This stage involves deciding whether it will be enough to do a simple cold call or to set up an

appointment which is needed in case we want to set up a stall. Like in the case of setting up

stalls in IT companies where a larger section of our targeted population can be met it becomes

essential that we first fix up an appointment with the facilities manager asking his permission to

set up the stall.

3. Approach:

This stage involves getting in initial contact with the customer by meeting him and generating

interest in the product. Once the salesmen we are with the customer they would make a

presentation making him aware of the characteristics of the paper, the discount and themagazines that are on offer.

While selling to Financial Institutions sales representatives focus on presenting the various

Business magazines that the customer will get if he subscribes. While pitching to younger

customer salesmen focuses on the monthly magazines which are more enticing to them. While

making presentations to corporates the focus is on the operational efficiency and convince the

Facilities Manager that the implementation will be starting in 2 weeks time from when the

employees start signing up for the subscription.

4. Handling Objection:

The most common objection which is encountered during the selling is the fact that most

customers who are regular readers of others newspapers are very loyal and are unwilling to

change. This is the time when distinguishing features of the products need to be highlighted for

example Business Standard highlights the fact that it has has various sections like the BS

200 which gives the complete analysis of the 200 companies that were traded the most on the

stock exchange the previous week. This section on the paper is something unique only to

Business Standard. Also 'The Compass' which is a small segment in the Business Standard

Newspaper assists people in making their investment decisions as to which sector they should

invest their money in was also of interest to people who were more investment focused.

And of course the magazines which are offered are another reason why most of these customers

get ready to buy the subscription. Also the supplements like Brand Line, Life by Business Line,


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and The Smart Investor by Business Standard are highlighted to entice the consumers to

purchase the subscription.

Some of the customers are worried about the implementation time this is where sales person

had to tell the customers about how we will be ensuring that they get a regular supply of their

business standard by interacting with their vendors and start the delivery of their newspaper totheir home in 2 weeks.

5. Closing:

At this stage the customer is more or less aware of the product and has made up his mind to

either go ahead with the sale or not. If the subscription are attractively priced most customers

prefer to go for the plan offered and want to first get a look at the service being provided. Thus

most people will either back out at the middle of the presentation, while others stick around to

try and see what they are getting for their money. By the time salesman pops the final question

whether the customer wants to pay by cash or cheque the customer usually has made up his

mind.

The distribution channel plays a key role in the newspaper industry, the newspapers have a very

short life time and hence it is highly essential to choosing a proper distribution channel. The

distribution channel adopted in the newspaper industry is not the same as the distribution

channel adopted for other products, we have seen in the previous section how the normal

products are distributed and now lets see the distribution pattern followed by the times of

India.

The normal distribution channel has intermediaries like wholesaler, retailer, agent etc. But you

wont find them in the case of a distribution channel of newspapers. The reason is that the

wholesaler stocks the products for some time and then passes the products to the next

intermediary. In the case of newspapers, if the newspapers are stored and delivered then they

become useless, as the paper reaches late to the customer and by the time paper reaches the

customer the customer will get the news from various other source.

In this case of newspaper the channel is almost same but the process takes place bit faster thanother products, in this case the wholesaler is replaced by the dealer and the retailer is replaced

by the vendor. The papers are printed and they are passed to the respective dealers , the

dealers generally receive the newspapers and supplements separately, the dealer after

collection both the newspapers and the supplements passes on the number of paper to each and

every vendor falling under him. The vendor receives both the news paper and the supplements

and they he has to arrange the newspapers and supplements together, one newspaper may have

n number of supplements and thus the required supplements are to be inserted to each and

veypaper given to them. The vendors have number of beat boys bellow them how actually

deliver the newspaper to the customer.

The above process explains how the distribution channel work in a newspaper industry. Now

lets see the pictorial representation of the distribution channel followed in the newspaperindustry.


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The distribution process in times of India takes place on 2 phases one for the upcountry edition

and other for the city called the mid night edition, the upcountry editions are first printed and

distributed because they have to reach a longer distance. The upcountry edition is circulated to

the outskirts of Chennai and the city edition is circulated with in Chennai. The concept is that

the longest distance gets the first printed copy and the nearest distance gets the last printed

copies.

The reporters collect the information all round the day and then they are edited and made ready

for printing, The early edition or the up country edition is edited around 10.00pm and the

printing starts at 11.00pm and the mid night edition starts printing by 12.00am, thus the news

are updated till 12.00 am for the mid night edition.

After these papers are printed the papers are then sent to various dealers in the city, dealers then

distribute the papers to the depots or the drop points, the vendors or hawkers in the depots insert

the supplement into the main newspaper and then they are given to the beat boys or the delivery

boys who deliver the paper to the customers in their respective houses. The entire process

should end by a maximum of 7.30 am.

DESCRIPTION OF THE PROJECT

The project deals with renewal of subscriptions, getting new subscription, a study on the

distribution channel adopted by The Times of India and also to conduct a market survey in

order to estimate the satisfaction level of the customer.

RENEWAL OF SUBSCRIPTIONS:

The main objective of the project is to renew The Times of India subscription in Delhi and tofind out prospective new readers.

The existing customer details available in the database was given to us and thus the customers

were called over the phone and the appointments were fixed and then the customers were met to

renew the subscriptions, during the process the customers were enquired about the level of

satisfaction and their feedback about the paper were noted.

The subscription price of the product for 1 year was Rs.299 and a free gift of either a travel bag

or flask was provided when it was launched and now the renewal price was fixed at just Rs.299

without any gift, as result of which many customers refused to renew without gift, this stood as

a challenging, thus we to had explain the customers about the offer, paper cost and so on and

convince them to renew the subscription.

When the customers were met for the renewal some customers experienced certain problems

with vendors and other service related issues were there, these issues were immediately brought

to the notice of the concern person in the organization and the issues were resolved

immediately, in order to improve the relationship between the product and the customers.


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Conclusion:

Today The Times Of India Group has emerged as a multi edition, multi product

organization, and a clear leader in the segment it operates. The Times of India has

emerged as the largest daily of the nation and the second largest English daily of the

world.

The channel used for the Distribution of a newspaper are common for all the players

in the market in spite of intense competition and the reason for that is that it s a

very different product


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Sdm Report on TOI

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