A RESEARCH REPORT ON CLASS ADVERTISING

SUBMITTED TO: KURUKSHETRA UNIVERSITY IN PARTIAL FULFILLMENT OF THE DEGREE OF

MASTERS OF BUSINESS ADMINISTRATION

2010-2012

Under the guidance of

Mr. SACHIN MITTAL (Lectt MBA) sem

Submitted by
SUSHIL KUMAR MBA 4th Regd. No. 07-GPG-132 Exam roll No.

SETH BANARASI DASS INSTITUTE OF MANAGEMENT & TECHNOLOGY (Approved by AICTE, Kurukshetra University, Kurukshetra)

SETH BANARASI DASS INSTITUTE OF MANAGEMENT & TECHNOLOGY OPPOSITE SECTOR-7, PIPLI ROAD, KURUKSHETRA-136118 CONTACT NO. 09120-78629, 01744-220456 GUIDE CERTIFICATE

This is to certify that Mr Sushil Kumar Roll no. CO920033 of MBA (4th Semester) of this Institute has completed Research Project title CLASS ADVERTISING under the guidance of Mr Sachin Mittal Lecturer of MBA in SBDIMT, Kurukshetra. The work is original and is done by student herself under my guidance. This is being submitted to Kurukshetra University, Kurukshetra in the partial fulfillment of the requirement of the degree of MBA.

(Director)

(Project Guide)

DECLARATION
I am sushil kumar student of MBA here by declares that the project report titled Classs Advertising is completed and submitted under the guidance of Advertising Mr Sachin Mittal is my original work.

The imperial finding in this report is based on the data collected by me. This project has submitted to kurukshetra university, Kurukshetra for the purpose of compliance of requirement this examination.

Sushil Kumar

ACKNOWLEDGMENT
Being a student of M.B.A course research project are essential exercise and every student of professional studies is compulsory to go through these type of projects to find out the exposure of corporate world and its day-to-day dynamic characteristics. It is said, No learning is possible without any proper guidance and no research endeavor is a solo exercise , some contribution is performed by various individuals. It was privilege for me to under take this research project under guidance of Mr Sachin Mittal , Lecturer in M.B.A. Department, Seth Banarsi Dass Institute Of Management And Technology, Kurukshetra I would like to express my deep sense of gratitude to whole M.B.A. Department of our college for valuable guidance, inspiration and encouragement, we received during all the research period and with out this contribution the completion of project might not be possible. I would also wish to acknowledge my gratitude to all respondents whose sincere response helped me to accomplish this project.

Sushil Kumar

PREFACE
Retail Banking has always been an integral part of the Banking activities the world over, but it is only in the recent past that it has gathered special momentum. Though internationally this revolution started in 80s with the advent of credit cards followed by other products of retail financial services, yet, as far as India is concerned, the year 1995 marks the starting point of Retail Banking Revolution with Foreign Banks and new generation Private Banks taking the lead. Till 90s only foreign Banks were the main players in Retail Banking activities. The paradigm shift in the Indian Banking Sector brought out by deregulation, liberalization and globalization of the Indian economy and characterized by intense competition and wafer thin margins has compelled banks to shift focus from Corporate Banking to Retail Banking and look upon retail banking as a solution to some of their immediate concerns. Only a few years ago the Retail Banking was scorned by many specialists as too voluminous, transaction heavy and unprofitable business. Consumer and personal loans were considered unproductive and were thus discouraged. But things have changed now. Retail Banking has regained bankers interest not least because it is the activity where many major banks are making most of their money but also because of the more recurrent nature of its earnings. Many European banks that had ventured into wholesale and investment banking activities in a big way had to pay a heavy price in the recent times. The economic downturn and gloomy capital market environment has made investment banking lose mush of its shine making many banks to shift their focus back to Retail Banking. We therefore choose to do our project on Retail banking within the Banking Industry, which has seen tremendous changes in the past years, promising great scope in the years to come.

EXECUTIVE SUMMARY
With a view to cater to the need of the advertiser and know the insights of the advertising industry, the project report covers one of the main aspects that has been one of the much talked about area of consumer segmentation: Socio-Economic Classification. The project report covers the overview of Indian Entertainment & Media industry. It is one of the fastest growing sectors of the Indian Economy. Further, the Indian advertising industry as a part of IE&M industry forms 38%, estimated at roughly around Rs. 17000 crores at present. With the advent of many media reaching to the bottom of the pyramid, it is very essential for an advertiser to choose the right media that reaches right people at right time. However it is not an easy thing to predict as to what would be the best medium. For this purpose, a new concept was developed The SEC classification, which was created in 1988, ratified by Market Research Society of India (MRSI) and is used by most media researchers and brand managers to understand the Indian consuming class SEC, the classification of Indian consumers, is based on two parameters: Occupation and Education (Urban and Rural). For years, marketers followed mass advertising but then with the increasing competition and rapid media development and consumer shift in preference, there is a shift from mass advertising to class advertising. Despite a debate over the reliability of the SEC, it continues to be the top rated choice of the advertiser for the classification of the Indian consumer market. Class advertising requires lot of insights into the area to know the preference of the person belonging to a particular class. For one such purpose, the project report shows a survey conducted on the basis of SEC showing the overall media selection or the inclination of the mass of the class and thereby making it easier for the advertiser to select the media for advertising. Also the comparative preference model, that calculates the overall preference of the people based on four parameters Reliability, Effectiveness, Penetration and Preference of class from A1 to E2 (Urban) helps the advertiser to select the medium to advertise based on his target class and also with the Inter-class and Intra-class media comparision with the weighted score.

CONTENTS
1. Advertising industry
1.1 An Overview 2. Categories and Growth 2.1 An Overview 2.2 As a part of IE&M 2.3 New Trends 2.4 Scope of Ad Industry in India

3. Mass V/S Class Advertising 4. Shift from Mass to Class 5. Class Advertising: Meaning 6. SEC: A debate 7. SEC: Understanding Class
7.1 Demographics 7.2 Media 7.3 Understanding target and media selection 8. Research Methodology 9. Data analysis &interpretation 10. Findings 11. Recommendations 12. Conclusion 13. Bibliography 14. Annexure

ADVERTISING INDUSTRY

ADVERTISING INDUSTRY
The concept of advertising existed long before we had a term for it. Advertising is defined as the art of positioning and creating brands and persuading consumers to buy them through messages in mass media or personalized media that is gaining much attention these days.

It is also the means of informing as well as influencing the general public to buy products or services through visual or oral messages. A product or service is advertised to create awareness in the minds of potential buyers. Some of the commonly used media for advertising are T.V., radio, websites, newspapers, magazines, bill-boards, hoardings etc Advertising is one of the aspects of mass communication. Advertising is actually brandbuilding through effective communication and is essentially a service industry. It helps to create demand, promote marketing system and boost economic growth. Advertising plays a significant role in today's highly competitive world. A career in advertisement is quite glamorous and at the same time challenging with more and more agencies opening up every day. Whether its brands, companies, personalities or even voluntary or religious organizations, all of them use some form of advertising in order to be able to communicate with the target audience. Today, new areas are emerging within advertising like event management, image management, internet marketing etc.

Overview of Advertising Industry in India

The structure of the advertising industry in Asia Pacific has been affected by globalization and Global companies are discovering the appeal of marketing their products in India. With a population of more than one billion, and a middle class that's larger than the total population of the United States, there's definitely money to be made. Television, movie, video and radio jingles, newspaper and magazine advertising and neon-lit billboards in the cities are fueling a revolution in consumer products and spawning new styles of living -

changing food habits, fashions and home dcor. This new advertising is pleasing the growing middle class, one of the largest target populations in the world, but it is drawing criticism from Indians concerned that it could sharpen social tensions in a country with so many poor people. Local retailers in apparel, food, watches and jewelry have all increased their average ad spending by almost 50% in the past two years. Coupled with many other local players big retailing brands are spending to the tune of Rs 12,000 crores annually on advertising and promotional activities. This figure, according to industry estimates, was less than Rs 400 crores about 2-3 years ago which means the growth has been a whopping 40%. The local firms are using all the available advertising tools from electronic to print, outdoor advertising and even models. The advertising and promotional spending by local brands is substantial during the festival season and almost 70% of the spending is done between Septembers to January. The advertising industry in India is growing at an average rate of 10-12% per annum. Over 80% of the business is from Mumbai and Delhi followed by Bangalore and Chennai from the rest of the other major cities in the country. A once-flagging advertising industry is booming in India. It has become fiercely competitive and one of the country's fastest-growing economic sectors. But the boom in advertising has touched off a debate on whether the industry has developed too quickly without preparing consumers adequately.

Advertising: As a part of Indian entertainment and media industry.

The advertising industry is one the most important part of the entire Indian Entertainment and Media industry. The advertising industry contributed a share of 38 percent in the overall IE&M industry revenue of 2007, up from 37 percent in 2006. The advertising industry itself recorded a growth of 22 percent over the previous year contributing an estimated Rs 19,600 crore in 2007 as compared with Rs 16,100 crore in 2006. In the last

four years, the advertising industry recorded a cumulative growth of 20 percent on an overall basis. On the basis of the estimation made by various agencies around the world, the advertisement industry in India is estimated to reach approximately Rs. 36371 crores by the year 2010, the major chunk of which will be contributed by the print media of nearly 50%. the reason of that could be the literacy levels rising to 551 million people in India. And more people in rural and urban areas are reading newspapers and magazines today. Print media is also the favourite segment for global investors with maximum foreign investment in this segment. The print media industry still has the potential to grow as 236 million literate people in India are still not tapped by any publication. At present, the print media is the highest contributor to the advertisement revenue followed by television and outdoor advertising respectively. In spite of the increase in the global internet usage, the total number of people using internet in our country is far less than other countries. Thus the present share of internet media in advertising is nearly 0.5-1% which is estimated to be 4% by the year 2011.

Categories and Growth

Categories and Growth

The and Industry recorded
The IE&M Industry is expected to grow at a CAGR of 18% till 2011 to touch Rs 1 trillion from Rs 436 b in 2006.

Indian Media has a

Entertainment

growth of 17 per cent in 2007, over 2006. In the last four years (2004-2007), the industry recorded a cumulative growth of 18% on an overall basis. However though Indian Entertainment and Media (IEM) is one of the fastest growing sectors in the economy, it is just 0.7% of the global US$ 1.4 trillion media industry The IEM is divided into different segment like Television, print, films, radio, music and internet. Out of home advertising (OOH) and live entertainment are too gaining importance. As per PwC, India will be one of the key drivers in pushing the global entertainment and media industry. As mentioned above, it is expected to grow at a CAGR of 18% till 2011 to touch Rs 1 trillion from Rs 436 b in 2006.

The expected growth for the year 2008-2011 can be known from the following chart:

Given below is the breakup of the revenues among the various segments and the expected growth rate till 2011. Television and print would continue to remain the largest segments. Internet, radio and OOH would also witness high growth rates. However, Internet penetration would take time to mature.

Present and projected growth in E&M industry* (in Rs crore)

2006 Television Print Media Film Entertainment Radio Music OHH Advertising Live Entertainment Internet Total* 19,120 12,790 8,450 500 720 1,000 900 160 43,640 2007 21,900 14,400 9,600 600 740 1,200 1,100 270 49810 2008 26,600 16,200 11,200 800 750 1,400 1,300 420 58,670 2009 33,100 18,200 12,600 1,100 760 1,600 1,600 600 69,560 2010 43,100 20,600 14,600 1,400 800 1,900 1,800 820 8,5020 2011 51,900 23,200 17,500 1,700 870 2,150 1,900 950 100,170 CAGR 22% 13% 16% 28% 4% 17% 16% 43.00% 18%

Source: Industry estimates & PwC analysis *Note: The figures taken above include only the legitimate revenues in each segment. Revenues from the Animation and Gaming segments have not been included in the industry size as these are traditionally included in the Indian IT and Software Revenues

An overview
Changing consumption patterns, rising aspiration levels and increase in the number of middle-income and upper-income households has led to growth in non- discretionary sectors like retail, telecom, and hotels among other sectors. Media sector is no exception to the trend. The Indian media and entertainment sector is one of the fastest growing sectors of the country and is expected to grow at an annual rate of 18% till the year 2011. It has seen many changes in terms of economic, demographic, technological, liberalization and others in the past decade which has led to the higher chances of growth to the industry. The Economic influence: The Indian Entertainment and Media (E&M) industry has outperformed the Indian economy and is one of the fastest growing sectors in India. The E&M industry generally tends to grow faster when the economy is expanding. The Indian economy has been growing at a fast clip over the last few years, and the income levels too have been experiencing a high growth rate. The increasing rate of urbanization, the penetration of television and radio industry in the rural areas with the help of the technology and the rising levels of incomes of the people in India has facilitated the growth rate of Media and Entertainment industry in India. Over the past few years, India has registered the fastest growth among major democracies. It represents the fourth largest economy in terms of ''purchasing power parity''. Thus, E&M industry is also expected to significantly benefit from this fast economic growth The Demographic Influence: Over the years, spending power has steadily increased in India. Lifestyle changes brought about by changes in economic activity are also spurring growth of the Indian E&M industry. In urban areas of India, the consumer mindset is changing due to increased exposure to global influences via media, and other interactions leading to higher aspirations. The Indian rural market with its vast size of nearly three

times of urban India, also offers a huge opportunity that has remained largely untapped due to reasons of accessibility and affordability. Liberalizing Foreign Investment: Today India has probably one of the most liberal investment regimes amongst the emerging economies with a conducive FDI environment. The E&M industry has significantly benefited from this liberal regime. In 2005, FDI was permitted in two important sectors - print media and radio. Films, television and other segments are already open to foreign investment. In the print media segment, 100% FDI is now allowed for non-news publications and 26% FDI is allowed for news publications. Printings of facsimile editions of foreign journals are now also allowed in India. This policy is helping foreign journals save on the cost of distribution while servicing the Indian market audiences more effectively. The FM radio sector too was opened for foreign investment with 20% FDI being allowed. The Technological Influence: India is witnessing a revolution in this sector with the emergence of new technologies. The IEM has moved from the growth phase to the inflection phase. This growth is led by better technologies, higher quality content, higher penetration and suitable regulations. Exciting new developments in the technologies used in Media and Entertainment industry are taking place. The change is already being witnessed from AM radio to FM radio, single screen theatres to multiplexes, and basic cable analog to broadband internet. Going forward, DTH, IP-TV, mobile marketing, gaming zones, and interactive television are going to hit the markets thereby changing the media scenario. Animations, multiplexes, new distribution channels, the use of Internet and personalized communication with the help of the same, are redefining the media and entertainment industry. All these factors will favour the growth of Media and Entertainment industry in India. Many companies are taking initiatives to set up their business all over with the help of such technology. One such company is city based Net Hot Zone Media Pvt. Limited which has come up with first of its kind concept of personalized communication with the customers providing them free internet service while offering part of screen space on computer to the advertisers by setting up the kiosks at various places in the city.

Thus given the high rate of economic growth and technological developments, Indian Media and Entertainment industry is poised to register a tremendous growth in the coming years.

Television Industry Amongst the segments of the industry, the television industry will continue to contribute the largest share. Subscription revenues are projected to be the key growth driver and will increase both from the number of pay TV homes as well as increased subscription rates. New distribution platforms like DTH and IPTV will only increase the subscriber base and push up subscription revenues. Print Media Industry The print media industry, comprising of newspaper and magazine publishing, is projected to grow at 13% (CAGR) from year 2006-2011. A booming Indian economy, growing need for content and government initiatives that have opened up the sector to foreign investment are driving growth in print media. With the literate population on the rise, more people in rural and urban areas are reading newspapers and magazines today. Also, there is more interest in India amongst the global investor community. This leads to the demand for more Indian content from India. Film Entertainment The Indian film entertainment industry is projected to grow from the present size of Rs 9600 crores to Rs. 17500 crores. Advancements in technology are helping the Indian film industry in all the spheres-film production, film exhibition and marketing. The industry is getting increasingly corporative. Radio

The radio industry, fuelled by the positive FM-II Radio Policy, is projected to grow with the highest CAGR till the year 2011. In 2005, the government opened up the sector to foreign investment along with migration to a revenue-share scheme. These factors along with privatization of a large number of frequencies as part of the FM II Radio Policy will drive growth. New concepts like satellite radio, visual radio and community radio have also begun to hit the market. Music While physical sales in the music industry continue to be hampered by piracy and falling prices, digital music has witnessed a surge that will propel this industry in the next five years. The total music industry is currently estimated to be worth around Rs 740 crore and is expected to grow at a CAGR of 4% in the next five years. Out Of Home Globally, outdoor advertising is very popular as corporations abroad have recognized the outdoor media as a very popular medium of advertising. But in India in spite of OOH being very effective and very economical in comparison to newspapers and television it has not gained momentum as compared to other segments. However, OOH advertising is expected to be the fourth largest segment of IEM industry by the year 2011. Live entertainment Live entertainment is a huge source of revenue for the global Media and Entertainment industry. Live entertainment - sometimes also called event management- is growing at a fast and steady rate. The number of corporate awards, television, films, and sports events are increasing rapidly, helping the sector grow at a fast rate. The current live entertainment segment of the Media and Entertainment industry comprises a small number of large event management companies and a large number of smaller companies.

Internet Internet advertising spending is set to grow several folds, especially in Indias entertainment sector. While internet advertising comprises nearly 0.5% of advertising at present, it is expected to be 4% by the year 2010. Until such time, the projected yearly growth rate of the ad industry is to stabilize at 11%. The growth of online ad industry is estimated to shoot up to 43% by the year 2011. However, even though India is ranked eighth in the world in terms of number of internet users, the country is not ranked amongst the top 10 countries in terms of average monthly hours online per unique visitor which may hamper the growth of internet advertising as compared to others media types. Others Amongst the other segments, the animation and gaming industry is expected to show the maximum growth, albeit from a small base. The animation and gaming industry is projected to grow from the present size of Rs 11 b to Rs 29 b by 2011, implying a 22% cumulative annual growth over the next five years. The following is the comparative chart of the different sectors percentage revenue in the Indian Entertainment and the Media industry in the year 2007 and that of expected in 2011.

2009

2011

1% 19%

1%2% 2%1%

1% 1% 2% 2% 2%
45%

17%

52%
29%

23%

TV FILM ENT. MUSIC LIVE ENT.

PRINT RADIO OOH INTERNET

TV FILM ENT. MUSIC LIVE ENT.

PRINT RADIO OOH INTERNET

Thus, the estimate says that TV sector will continue growing while the share of print and film entertainment will increase in absolute numbers but at a decreasing rate while the rest of the sectors will have more or less the same share.

Thus The Indian entertainment and media industry today has everything going for it - be it regulations that allow foreign investment, the impetus from the economy, the digital lifestyle and spending habits of the consumers and the opportunities thrown open by the advancements in technology.

Overview of Advertising Industry in India

The structure of the advertising industry in Asia Pacific has been affected by globalization and Global companies are discovering the appeal of marketing their products in India. With a population of more than one billion, and a middle class that's larger than the total population of the United States, there's definitely money to be made. Television, movie, video and radio jingles, newspaper and magazine advertising and neon-lit billboards in the cities are fueling a revolution in consumer products and spawning new styles of living changing food habits, fashions and home dcor. This new advertising is pleasing the growing middle class, one of the largest target populations in the world, but it is drawing criticism from Indians concerned that it could sharpen social tensions in a country with so many poor people. Local retailers in apparel, food, watches and jewelry have all increased their average ad spending by almost 50% in the past two years. Coupled with many other local players big retailing brands are spending to the tune of Rs 12,000 crores annually on advertising and promotional activities. This figure, according to industry estimates, was less than Rs 400 crores about 2-3 years ago which means the growth has been a whopping 40%. The local firms are using all the available advertising tools from electronic to print, outdoor advertising and even models. The advertising and promotional spending by local brands is substantial during the festival season and almost 70% of the spending is done between Septembers to January. The advertising industry in India is growing at an average rate of 10-12% per annum. Over 80% of the business is from Mumbai and Delhi followed by Bangalore and Chennai from the rest of the other major cities in the country. A once-flagging advertising industry is booming in India. It has become fiercely competitive and one of the country's fastest-growing economic sectors. But the boom in advertising has touched off a debate on whether the industry has developed too quickly without preparing consumers adequately.

Advertising: As a part of Indian entertainment and media industry.

The advertising industry is one the most important part of the entire Indian Entertainment and Media industry. The advertising industry contributed a share of 38 percent in the overall IE&M industry revenue of 2009, up from 37 percent in 2008. The advertising industry itself recorded a growth of 22 percent over the previous year contributing an estimated Rs 19,600 crore in 2009 as compared with Rs 16,100 crore in 2008. In the last four years, the advertising industry recorded a cumulative growth of 20 percent on an overall basis. On the basis of the estimation made by various agencies around the world, the advertisement industry in India is estimated to reach approximately Rs. 36371 crores by the year 2010, the major chunk of which will be contributed by the print media of nearly 50%. the reason of that could be the literacy levels rising to 551 million people in India. And more people in rural and urban areas are reading newspapers and magazines today. Print media is also the favourite segment for global investors with maximum foreign investment in this segment. The print media industry still has the potential to grow as 236 million literate people in India are still not tapped by any publication. At present, the print media is the highest contributor to the advertisement revenue followed by television and outdoor advertising respectively. In spite of the increase in the global internet usage, the total number of people using internet in our country is far less than other countries. Thus the present share of internet media in advertising is nearly 0.5-1% which is estimated to be 4% by the year 2011. The following chart shows the figures of the ad spend from the year 2006-2009 and the estimated ad spend for the year 2010 against 2011.

YEAR 2008 2009 2010 2011

PRINT 5464 6323 6946 8591

TV 4872 5412 6200 6766

OOH 847 897 945 391

MEDIA RADIO INTERNET 220 58 317 106 133 155 215 215

CINEMA 139 145 131 194

TOTAL 11600 13200 14510 16372

Thus for that past 5 years, print media has been the largest contributor to the ad industry followed by TV. However with the emergence of various media like radio and internet which is gaining much attention these days are expected to rise at a very high rate taking up the share of print and TV. In spite of all these, internet as a media and advertising is the fastest growing and is expected to have nearly 4- 5% ad spend share by the year 2011.

Ad market share percentage of various media year 2009 and 2011

Advertising Market Stats/Projections: YEAR 2009

The overall advertising and media industry is expected to close at Rs 21,314 crore in revenues in 2008, riding a 20 per cent growth rate Television advertising market is projected at Rs 8,674 crore in 2009 The print industry stands at nearly Rs 10,000 crore. The cinema medium will corner around 0.7 per cent of the total advertising budget in 2009. Outdoor media industry will grow at 14 per cent to touch Rs 1,454 crore, Radio is likely to record a 40 per cent growth in 2009 to touch Rs 672 crore Internet advertising will constitute only 1.7 per cent of the overall advertising spends in 2009, up from the current 1.4 per cent.

The decline in share of print and TV is not only because of the upcoming media but also because the market itself is expanding.

New trends in ad industry

Ad industry is one of the fastest growing sectors in the country. With the development of the economy the development in the industry has also gained momentum. It is gaining momentum as a source of information and stream of revenue. All the recent developments have helped in opening new doors for the development in the industry. For the past so many years; the ad industry had been concentrating on mass media. Increasingly, other media are overtaking television and other traditional media because of a shift towards consumer's change in perception. Thus, it has become necessary for the advertisers to constantly find newer ideas to attract the attention of the consumers. The advertisers are now opting for personalized communication than mass communication. It has become extremely necessary for the advertisers to understand the needs of the customers on the individual basis. Thus the shift that is seen in the Indian ad industry is from mass advertising to class advertising.

The latest buzz in the industry is of online marketing. Mass media like newspapers, magazines, radio and television are no doubt hugely effective media for commercial advertisements, but internet is completely different from them in many respects in terms of achieving the objective of an ad. According to statistics, online ad spend by the year 2010 is expected to grow at the rate of 43%. Within online advertising there are many options available to the advertiser. Among that email marketing tops since it is also a good option for personalized communication which is preferred by most of the advertisers nowadays. Also, blogs is an emerging way of communicating to the people. Another upcoming phenomenon is mobile marketing. With the increase in number of people having the cell phone especially India, which stands second in the highest number of mobile users, mobile marketing is gaining attention of many advertisers. One type of mobile ad is based on SMS (Short Message Service) text messages. The benefit of SMS text messages is people can respond where they are, right now, stuck in traffic, sitting on the metro. A new form of advertising that is growing rapidly is Social network advertising. It is online advertising with a focus on social networking sites. This is a relatively immature market, but it has shown a lot of promises as advertisers are able to take advantage of the demographic information the user has provided to the social networking site.

Scope of Advertising Industry in India

The advertising industry in India has several competitive advantages:

India has a rich pool of strategic planning, creative and media services personnel: Indeed, Indian advertising industry has been exporting senior-level talent to many countries, particularly to the Gulf, South-East Asia, China, the UK and the US. Indian talent is recognized and respected in global agency networks.

No other country has access to so many trained management graduates who can provide strategic inputs for brand and media planning.

Indians are multicultural: we learn at least two languages and that gives us a head start in understanding cultural diversity. Most of the top 20 agencies in India have a global partner or owner, which should provide an immediate link to global markets. Our production standards in TV and print have improved: With a vibrant animation software industry, we have access to this area of TV production. India's advanced IT capabilities can be used to develop Web-based communication packages for glob al clients

MASS V/S CLASS ADVERTISING

MASS V/S CLASS ADVERTISING

What is mass To understand what is mass marketing/advertising, it is important to know what exactly mass refers to. From the viewpoint of marketing, mass is the group of consumers who occupy the overwhelming mass of a bell curve for common household products, i.e. they could be tagged as being "average". Yet, this group consists of such a wide variety of people; their desires towards a certain product may be totally different from each other. Often competition to supply the mass market is fierce, but relatively easy to enter because of the large amount of consumer pool available. Mass marketing/advertising Mass advertising is one of the most widely used traditional methods in advertising. Mass advertising that refers to the approach to advertising that attempts to reach every consumer, rather than targeting a particular market segment. It is a type of marketing (or attempting to sell through persuasion) of a product to a wide audience. The idea is to broadcast a message that will reach the largest number of people possible. Traditionally mass marketing has focused on radio, television and newspapers as the medium used to reach this broad audience. By reaching the largest audience possible exposure to the product is maximized. In theory this would directly correlate with a larger number of sales or buy in to the product. Mass market advertising is usually more expensive than direct marketing, because they are priced according to the number of consumers who will be reached, and must generate a larger return in order to justify the expense. The trend of mass media has seen many ups and downs. These trends are due to corresponding upswings in mass media, the parent of mass marketing. For most of the

twentieth century, major consumer-products companies held fast to mass marketing- mass producing, mass distributing and mass promoting about the The mass media are capable of facilitating short-term, intermediate-term, and long-term effects on audiences. Short-term objectives include exposing audiences to different concepts; creating awareness and knowledge (e.g. right to information); altering outdated or incorrect knowledge (AIDS campaign, Coke and Pepsi for clearing doubts in the pesticides case); and enhancing audience recall of particular advertisements(e.g. Fevicol, Raymonds) or public service announcements (PSAs), promotions(Dominos Pizza), or program names. Intermediate-term objectives include all of the above, as well as changes in attitudes, behaviours, and perceptions of social norms. Finally, long-term objectives incorporate all of the aforementioned tasks, in addition to focused restructuring of perceived social norms, and maintenance of behavior change. Evidence of achieving these three tiers of objectives is useful in evaluating the effectiveness of mass media. Types of mass media Television Radio Print OOH Internet

Television is a powerful medium for appealing to mass audiencesit reaches people regardless of age, sex, income, or educational level. In addition, television offers sight and sound, and it makes dramatic and lifelike representations of people and products. Television ads have a different impact of it on the peoples mind is most remembered. Call it the power of television or power of sound and image together, television has become one of the most preferred choices to attract the masses. Also the penetration and the reach of television has increased incredibly that it is beneficial for the companies to advertise on television to gain benefit over a long period of time in spite of it being expensive. Lots of

ads targeting masses are seen more on television than any other media. E.g. soaps, shampoos, water purifiers, automobiles, etc. Radio. Radio also reaches mass and diverse audiences. The specialization of radio stations by listener age, taste, and even gender permits more selectivity in reaching audience segments. Many radio stations have come up in the past 5 years and its still increasing. In Ahmedabad itself there are five radio stations and since placement and production costs are less for radio than for TV, radio is able to convey messages in greater detail. Thus, radio is sometimes considered to be more efficient. The main benefit for the same can be that it is the best means if the target is local. Radio Mirchi, My FM, Red FM, Radio City and many others have their stations in many other cities. Thus, it can target mass audience on local level. However radio requires somewhat greater audience involvement than television, creating the need for more mental imagery. Because of this, radio can reinforce complementary messages portrayed in parallel fashion on TV. Print Newspapers are available in daily and weekly formats, and local, regional, and national publications exist. In addition, there are numerous special audience newspapers (e.g., various ethnic groups, women, Geography specific). National dailies in India have highest penetration amongst all media of advertising. Classifieds in that is the commonest form of advertisements. However the biggest disadvantage is that there are chances of it being overlooked. Among other print media, magazines are also preferred by the advertisers especially the mass is divided. Other Print Media Pamphlets, brochures, and posters constitute other print media used to disseminate health messages. These print media were developed with the assistance of target audiences, and few contained varied messages, were culturally tailored, or employed readability and face validity techniques. The extent to which persons read, re-read, and keep these devicesor circulate them to other readersis not well evaluated. Thus, their permanence is unknown.

Outdoor media. Outdoor media include billboards and signs, placards inside and outside of commercial transportation modes, flying billboards (e.g., signs in tow of airplanes), blimps, and skywriting. Commercial advertisers such as Rado, Rolex, Pepsi, Vodafone and Kingfisher all make extensive use of their logo-bearing blimps around sports stadiums especially any cricket match in India. For persons who regularly pass by billboards or use public transportation, these media may provide repeated exposure to messages. Pro-health messages displayed on urban public transportation may suffer, however, from the image problems that afflict urban buses and subways. In addition, the effectiveness of such postings wears out quickly as audiences grow tired of their sameness. Internet The advent of the World Wide Web and the massive increase in Internet users offers enormous opportunities and challenges. The Internet places users in firmer autonomous control of which messages are accessed and when they are accessed. It is possible to put virtually anything on-line and disseminate it to any location having Internet access, but the user has little control over quality and accuracy. Internet search engines can direct users to tens of thousands of web sites after the user's introduction of one or more keywords. But unlike TV or radio, which are available in nearly all households; Internet access requires some technical skill, as well as the resources to purchase hardware and Internet subscription services. The most important benefit is that It can attract masses all over the world unlike TV and Radio. Also internet is such a medium which can be termed as a personalized media too. What can be marketed on mass basis? A mass market strategy is effective for products that appeal to a broad cross-section of consumers and used to effect attitude change to as wide an audience as possible like aspirin or orange juice. It is not appropriate for products with limited appeal like toothpaste. Toothpaste isn't made especially for one consumer and it is sold in huge quantities. A company or individual who manufactures toothpaste wishes to get more people to buy their particular brand over another. The goal is when a consumer has the option to select a tube of toothpaste that the consumer would remember the product which was marketed. Mass

marketing is the opposite of niche marketing, where a product is made especially for one person or a group of persons. Other products of mass marketing are furniture, artwork, automobiles, residential communities, fizzy drinks and personal computers. Typically, things which are perceived to be necessary/essential to the consumer are subject to mass marketing. However, even in the products which were earlier thought of being marketed on the mass basis are nowadays marketed on the basis of customization. Like furniture is now made as per the demand of the customer. Or the best example can be that of personal computer. Dell, an American company, sells its computer as per the requirements of the customer. Thus everywhere there is shift from mass advertising to class advertising.

SHIFT FROM MASS TO CLASS

SHIFT FROM MASS TO CLASS

The Evolution from Mass Marketing The successes of mass marketers led to the appearance of an alternate approach to marketing. Potential competitors wanting a share of the large market had two options. One was to replicate the organization, promotion, and distribution systems of the company that had created the mass market. The other was to go after a part of the market that had unique needs by developing products specifically for them. For nearly all of the challengers, building an operation to parallel that of an entrenched industry giant was not profitable or realistic. As a result, most of them gravitated to the more attractive market-segmentation approach. General Motors, in the US used market segmentation as early as the 1920s when it produced different models for different groups of customers to compete with Ford. Pepsi made a series of attempts, beginning in the 1990s, to crack into Coca-Cola's market share through changes in product and targeted promotion strategy in India making it a youth drink. Also that that time, television provided a powerful tool for both new and old companies to reach segmented markets. By the late 90s, market segmentation had surpassed mass marketing as the primary approach. Mass Marketing Now and in the Future In spite of the shift to market segmentation, mass marketing continues to be used in many situations and has potential for others. Products with broad appeal and few distinguishing characteristics such as household cleaners, potato chips, and pain relievers lend themselves to mass marketing just as they always have. At the same time, businesses that use mass marketing for their goods and services continue to look for ways to enlarge their markets by designing different appeals for non-customers. Chewing gum, for example, is presented as an alternative to smoking. Utilities and credit cards offer special rates to entice potential high-volume customers. And discount retailers, such as Big-Bazaar, match their mix of mass-marketed products to local customer bases.

Any current or future product that has m ass-marketable attributes will likely be marketed by some form of the approach. In addition, the Internet provides a new medium for mass-marketing initiatives, and newly opened international markets offer a possible arena for mass-marketing opportunities. But as rightly said, change is the only thing that is permanent, even the changes are expected in terms of the ways of marketing and targeting the customers on personalized basis. Especially with the companies becoming global and audience becoming conscious of what they want, companies are more concentrating on offering customers a more personalized touch. Also segmentation on the basis of classes is one of the most emerging concepts. India being known for its extremities of people in terms of income, education, work and social classes, companies have started opting this class advertising approach to attract the targeted audience thats fits into segment of probable buyers of the products or services offered by the advertisers. For that new methods of marketing have been put into practice in this race of attracting customers. Old model is being replaced by new model of customerization.

Given below is the difference showing the difference in old and new model.

Old modeltraditional
Relationship with the customer Customer Needs Segmentation Passive participant Articulated Mass market and Target segments Pricing Fixed pricing & discounting

New model-customerization
Active co-producer Articulated and Unarticulated Customized segments

Value based pricing model. Customer determined IMC & interactive Online distribution channels or third party logistics The customers name as brands Marketing finesse and capturing the customer as partner Customer interactions drive new product development.

Communication Distribution Branding Basis of

Advertising and PR Traditional retailing and direct marketing Traditional branding and co-

branding competitive Marketing power service Line extensions modification, customizes products, services, and marketing. Marketing and R&D drive new product

advantage Product and offerings

CLASS ADVERTISING

CLASS ADVERTISING
Understanding the Indian Consumer India's economic growth has accelerated significantly over the last two decades, along with the spending power of its citizens. Real average household disposable income has roughly doubled since late 80s. With rising incomes, household consumption has increased, and a new Indian middle class has emerged. As Indian incomes rise, the shape of the country's income pyramid will also change dramatically. More than 291 million people will move from desperate poverty to a more sustainable life, adding a number of first-time consumers to the market. While much of this new wealth and consumption will be created in urban areas, rural households will also benefit.

The Need for Targeting Specific Class/ Group

Two words sum up todays consumer market: unlimited choice. Over the past decade, companies have rushed to steal market share by creating an unending stream of new products to meet the desires of consumers. At the same time, media outlets have proliferated and different concepts have emerged to woo the customers from customization to interactive media advertising. Marketers are faced with the challenge of getting their message heard by consumers who are hard to find and even harder to influence. But the question is how can companies create awareness of their products? One thing is certain: Mass marketing no longer works. Marketers are no longer able to reach a mass market. Even if they could, there is no longer a one-product-fits-all mentality that would appeal to consumers. Thus marketing concept calls for understanding customers and satisfying their needs better than the competition. But different customers have different needs, and it rarely is possible to satisfy all customers by treating them alike. While

Mass advertising refers to treatment of the market as a homogenous group and offering the same marketing mix to all customers and economies of scale to be realized through mass production, mass distribution, and mass communication. Target advertising on the other hand recognizes the diversity of customers and does not try to please all of them with the same offering. The first step in target marketing is to identify different market segments and their needs. The drawback of mass marketing is that customer needs and preferences differ and the same offering is unlikely to be viewed as optimal by all customers. If firms ignored the differing customer needs, another firm likely would enter the market with a product that serves a specific group, and the incumbent firms would lose those customers. Thus, marketers have found the need to concentrate on a specific group than mass. But how to group people and on what basis is one of the most challenging question for the marketers. Earlier the basis for segmentation was on four major categories, which mostly depends on the marketer to decide. Geographic Demographic Psychographic Behavioral However, a common classification that is used by marketers to describe the Indian population is the Socio Economic Classification thus giving rise to an entirely new concept of CLASS MARKETING. A common classification that is used by marketers to describe the Indian population is the Socio Economic Classification (SEC). SEC is the classification of Indian consumers on the basis of two parameters: Occupation and Education of the chief wage earner (Head) of the households. The SEC classification, created in 1988, was ratified by Market Research Society of India (MRSI), is used by most media researchers and brand managers to

understand the Indian consuming class. SEC is made to understand the purchase behavior and the consumption pattern of the households. This classification is more stable than one based on income alone and being reflective of lifestyle is more relevant to the examination of consumption behavior which will be presented in brief in the next section. The basic reasons for developing a SEC system were the following: 1. Income can discriminate between consumers and non-consumers for certain products, but not for others. 2. Income is not stable over time whereas SEC is, i.e., the cut-offs of high and low income will vary quite rapidly over time. 3. Income is often understated. The Urban Sector is divided into SEC A1, A2, B1, B2, C, D, E1, E2 (Calculated as a function of Educational qualifications of the CWE* and his occupation) The Rural Sector is divided into SEC R1, R2, R3, R4 (Calculated as a function of Educational Qualifications of the CWE* and the type of the household he stays in Pucca, Semi Pucca or Kaccha)

Table below shows the socioeconomic classification of urban Indian households.

OCCUPATION < 4 yrs in school E1 E2 D D

EDUCATION 5-9 yrs of school D E1 C D School certificate C D B2 C Some college C D B2 C Post grad uate B2 D A2 B2

Illiterate Skilled workers Unskilled workers Shop owner Petty trader Employer of > 10 persons < 10 persons None Others Clerk Supervisor Professional Senior executive Junior executive D D D B1 C E2 E2 D E2

Graduate B2 D A2 B2

B1 C D

B1 B2 C

A2 B2 B2

A2 B1 B1

A1 A2 A2

A1 A1 A1

A1 A1 A1

D D D B1 C

D C D B1 C

C C B2 B1 B2

B2 B2 B1 A2 B1

B1 B1 A2 A1 A2

B1 A2 A1 A1 A2

There are eight levels from A1 to E2The level wise classification can be known from the following table:

LEVEL A1

OCCUPATION

EDUCATION

Employer of >10 Persons <10 Persons None Professional Senior Executive College/Graduate/Post Graduate Graduate/Post Graduate Graduate/Post Graduate Post Graduate Graduate/Post Graduate Graduate/Post Graduate

A2

Shop Owner Employer of >10 Persons <10 Persons None Supervisor Professional Senior Executive

5-9years of school/School Certificate Some College Some College Post Graduate Graduate Some College

Junior Executive
B1

Graduate/Post Graduate

Employer of >10 Persons <10 Persons none Clerk Supervisor Professional Senior Executive Junior Executive Skilled worker Shop Owner Petty Trader Employer of >10 Persons none Clerk Supervisor Professional Junior Executive

Illiterate/Less than 4 years in school School Certificate School Certificate Graduate/Post Graduate Graduate Some College Illiterate/Less than 4 years in school/ 5-9 years of school/School Certificates Some College Graduate/Post Graduate School Certificate/ Some college Graduate/Post Graduate Less than 4 years in school/ 5-9 years of school 5-9 years of school Some College Some College School Certificate School Certificate

B2

LEVEL

OCCUPATION

EDUCATION

Skilled Workers Shop Owners Petty Traders Employer of <10 Persons none Clerk Supervisor Junior Executive Skilled Workers Unskilled workers Shop Owners Petty Traders
Employer of

School Certificate/ Some college 5-9years of school School Certificate/ Some college Illiterate Less than 4 years in school school Certificate 5-9years of school/school Certificate Illiterate/Less than 4 years in school/ 5-9 years of school 5-9 years of school School Certificate/ Some college Illiterate/Less than 4 years in school Less than 4 years in school/ 5-9 years of school Illiterate Illiterate/Less than 4 years in school/ 5-9 years of school Illiterate/Less than 4 years in school Illiterate/Less than 4 years in school/ 5-9 years of school Less than 4 years in school 5-9 years of school Illiterate Illiterate/ Less than 4 years in school Illiterate

none Clerk Supervisor Professional Skilled Workers Unskilled workers Skilled Workers Unskilled workers Petty Traders

E1 E2

There are eight levels from A1 to E2The level wise classification can be known from the following table:

LEVEL A1

OCCUPATION

EDUCATION

Employer of >10 Persons <10 Persons None Professional Senior Executive College/Graduate/Post Graduate Graduate/Post Graduate Graduate/Post Graduate Post Graduate Graduate/Post Graduate Graduate/Post Graduate

A2

Shop Owner Employer of >10 Persons <10 Persons None Supervisor Professional Senior Executive

5-9years of school/School Certificate Some College Some College Post Graduate Graduate Some College

Junior Executive
B1

Graduate/Post Graduate

Employer of >10 Persons <10 Persons none Clerk Supervisor Professional Senior Executive Junior Executive Skilled worker Shop Owner Petty Trader Employer of >10 Persons none Clerk Supervisor Professional Junior Executive

Illiterate/Less than 4 years in school School Certificate School Certificate Graduate/Post Graduate Graduate Some College Illiterate/Less than 4 years in school/ 5-9 years of school/School Certificates Some College Graduate/Post Graduate School Certificate/ Some college Graduate/Post Graduate Less than 4 years in school/ 5-9 years of school 5-9 years of school Some College Some College School Certificate School Certificate

B2

Table below shows the socioeconomic classification of Rural Indian household.

Education of chief wage earner

Professional degree

Graduation/ PG College SSC/HSC Class 4-Class 9 Up to class 4 Self-learning Illiterate

Type of House SemiPucca pucca Kuchcha R1 R2 R3 R1 R2 R3 R1 R2 R3 R2 R3 R3 R3 R3 R4 R3 R3 R4 R3 R4 R4 R4 R4 R4

Level R1 R2 R3

Education Professional Degree/Graduation/PG/College SSC/HSC Professional Degree/Graduation/PG/College Professional Degree/Graduation/PG/College SSC/HSC Class 4- Class 9/Up to class 4 Self-Learning Class 4- Class 9/Up to class 4 Self-Learning Illiterate

Type of House Pucca Pucca Semi-pucca Kuchcha Semi-pucca/kuchcha Pucca/Semi-pucca Pucca Kuchcha Semi-pucca/kuchcha Pucca/Semi-pucca/Kuchcha

R4

Urban & Rural Classification According to the Census of India 1991, the following criteria were adopted for treating a place as urban:

1. All statutory towns, i.e., all places with a municipality, corporation, cantonment or notified town area committee, etc. 2. All other places which satisfied the following criteria: - A minimum population of 5000 - At least 75% of the male working population engaged in non-agricultural pursuits, and - A density of population of at least 400 per sq km

board

3. Apart from these, the outgrowths of cities and towns have also been treated as urban All areas not identified as Urban, are classified as Rural.

SEC: A debate

SEC: A debate
Over the years, marketers have always targeted customers on the basis of their income and predicted their requirements on the same basis. For example, only the richer section were targeted for cars till late 80s until the focus shifted towards the new emerging Middle class which gained maximum attention of the marketer then after. Other examples could be expensive furniture, suiting and other lifestyle products and services which solely concentrated on the Elite class. However, with the increase in the trend of being IN thing not only are the people opting for those goods and services which was earlier meant to target other specific classes or on mass basis but also the spending is more dependent on the socio economic status than just income. Thus, an executive who is not so rich by income may have the needs for high-end products like luxurious car, far-away traveling, branded clothes, etc. The need arises from his status as an executive though he may not afford it, and would have surely bought if he belonged to higher class. Other argument is that, demand for certain products like newspaper arises not out of income. Even a lower income person can afford the subscription of newspaper, Gujarati, Hindi or English, which nearly costs same. But a person who is not educated and whose requirement of profession does not allow him to buy an English newspaper, naturally he would not go for an English one. Also almost everyone now spends not looking at their income but the status and to cope up with that, consumers today do not hesitate to spend their income lavishly leaving only a mere amount to savings. Also, awareness around the power of information technology to solve problems, create employment and improve lives has trickled down to the lowest socio-economic class. Mobiles are the best examples. The gadget which was earlier a status symbol is now a requirement and is being used by everyone around the corner. Created in 1988, the SEC divided Indian households on the basis of the chief wage earners education and occupation, SEC A1 to R4, covering all urban and rural areas. The direct correlation between a higher SEC and education was a result of the belief that a better

educated person would have greater (organized) employment opportunities and thus higher income. This classification is pertinent as compared to an income-level based classification, since lifestyle reflects the consumption patterns more closely than the income levels. The basic reasons for developing a SEC system were the following: 1. Income can discriminate between consumers and non-consumers for certain products, but not for others. 2. Income is not stable over time whereas SEC is, i.e., the cut-offs of high and low income will vary quite rapidly over time. 3. Income is often understated. The last has been proved by large-scale studies that compared household expenses with claimed income. Over 80 percent of upper income respondents were found to have regular monthly expenses well in excess of their stated monthly household income (MHI), and this proportion was not much lower among lower income respondents too. The second of the three reasons is also beyond dispute. Salary levels in India have undergone a huge change in the 1990s; annual incomes of 1 million-plus rupees are earned by thousands of families today, but were the privilege of the very rich a decade ago. Now let us examine the first reason stated in the context of a few product categories. The method used is that of a selectivity index, which compares the extent to which target audience definitions using surrogate variables SEC and monthly household income (MHI) match with the actual target audience as measured by very large-scale studies specifically the Indian Readership Survey. However, in spite of there being many arguments in favour of SEC, there are many questions that have been raised on it. Consumers are now breaking class barriers. Not only common man but celebrities are under a questionable situation too. Take Sachin Tendulkar

for an example. He owns a Ferrari, and his million-dollar endorsement deals are a matter of widespread national interest. As a brand ambassador, But many brands that he has endorsed in his 18-year career were never meant to be used by him. Tendulkar, who hasnt completed his graduate studies, would fall into what most Indian marketers recognize as socio economic classification (SEC) B a category that is distinctly middle-class.. The uni-dimensional way of looking at demographics is a key limitation of SECs. Several layers of consumer segmentation need to be added on like psychographics, cultural clusters, and life stages to make a compelling basis for defining consumer segments. Today, Swift competes outside its so-called category with bigger cars such as Esteem and Ikon. The consumer is willing to pay more for a smaller but better designed product. People are using brands to express themselves more than ever before. The size-price equation doesnt hold good here. Also there are many big names have completely junked the SEC segmentation, and prospered nonetheless. The first name is The Future Group. The company has gone with its own market definition for all of their retail formats. We have been maintaining that the SEC classification is not a true representation of Indian consumers for three-four years now, says Future Chairman Kishore Biyani. The group has worked out a system where the entire set of Indian consumers is divided into three broad categories: India One or the consuming class, India Two or the serving class and India Three or the deprived class. Biyanis philosophy is simple.

India One consists of the consuming class that makes up 16-18% of the consumers but account for 95% of the buyers. That is the core target audience that he is trying to capture. Also on Biyanis radar is a part of India Two, the group that serves India One, for instance, servants, watchmen and small grocers. Later, in 2002, Unilever devised its proprietary Living Standard Measurement (LSM) index as an alternative to SEC, which segments consumers into 18 LSM clusters on the basis of

25 parameters such as income, education, durables ownership, media consumption, entertainment preferences et al. However, even though many big companies going against SEC, there are still many big marketers who think along those lines. Theyre using the (SEC) classification data, because its the only data that they have. They use it along with additional data like ownership and consumption but there is no alternative to demographic data. Owing to this, a temporary solution was formed by splitting SEC A into two categories, A1 and A2. This led to a further division, as affluence rose in SEC A1 to an A1+, which was formed with a threshold of Rs 10,000 as monthly income. Yet, this has become dated, with nearly a decade since the idea of SEC A1+ was mooted. In fact, its been a decade since any serious changes were made to classify consumers. But what is considered as the biggest drawback of this SEC is that, it considers the occupation and education of CWE Chief Wage Earner which may not be always influential as far as purchase decisions are considered. Further refinement

No matter what debate it takes, market research in India has been evolving rapidly to tackle the increasing needs of marketers operating in a complex environment. One of the key evolutions was the development of a socio-economic system of classifying consumers around a decade ago. While SEC is an improvement on income, data from large-scale studies show that further refinement is now called for. One possible solution is to introduce further levels in the SEC system. This is being done by combining SEC with household expenses to see if a combined system yields better results. The appropriate questions are now being put on to large-scale surveys.

SEC: Understanding Class

Understanding Class: Demographics

Indian Socio economic structure is constantly changing. The main reason for which are: Growing Economy Consumption Boom Rising Income levels Rise in Working Population Increasing Nuclear Families Changing Food Behaviour Profusion of Brands

The demographic representation of population according to SEC can be known from the following chart:
Social Class A1 B2 C D E3 R1 R2 R3 R4 Group 14 (A-E) Group 25 (R1-R4)
Source: IRS(2005)

Total Value 21228 37351 46195 61573 64305 19671 56491 199061 243749 220652 578972 % 3 5 6 7 8 3 8 27 33 30 70

Male Value 11681 20237 24718 27589 33063 10180 29268 104834 122424 117288 266766

% 3 6 6 7 8 3 8 27 32 31 69

Female Value 9547 17114 21477 23984 31242 9491 27223 94167 121325 103364 252206

% 3 4 6 7 9 3 8 26 34 29 71

A = high/intermediate managers/well educated/ businessmen with large organizations B = intermediate managers/ good education/ businessmen/ self employed with small organizations C = petty traders/shop owners/clerks/salesman/ supervisors with some education D = poorly educated petty traders/shop owners/clerks/salesman E = skilled/unskilled workers R1 = well educated, living in good houses R2 = good education, living in not very good houses

R3 = some education, living in huts and temporary shelters R4 = uneducated, living in temporary shelters 1 Consists of the two Groups A1 and A2: Male A1 = 4,018 (1%); Female A1 = 3,386(1%); Total A1 = 7,404 (1%); Male A2 = 7,663 (2%); Female A2 = 6,161 (2%); Total A2 = 13,824 (2%); (All in 000) 2 Consists of the two Groups B1 and B2: Male B1 = 9,988 (3%); Female B1 = 8,452 (2%); Total B1 = 18,440 (2%); Male B2 = 10,249 (3%); Female B2 = 8,662 (2%); Total B2 = 18,911 (3%); (All in 000) 3 Consists of the two Groups E1 and E2: Male E1 = 12,510 (3%); Female E1 = 11,516 (3%); Total E1 = 24,026 (3%); Male E2 = 20,553 (5%); Female E2 = 19,726 (6%); Total E2 = 40,729 (5%); (All in 000) 4 A-E, total urban 5 R1-R4, total rural

URBAN
As mentioned earlier, urban population has eight levels of classes starting from A1 to E2. Urban population forms nearly 30% of total population. Going on the lines of this fact, the population stratification would be as follows: CHART:

URBAN SEC POPULATION E 27% A 10% B 18%

D 24%

C 21%

As per the above given data, Sections A & B refer to High-class- constitutes over a quarter.

RURAL
Rural population forms 70% of the total population and SEC Rural has four levels on the basis of occupation and type of house ___ Pucca, Semi-Pucca and Kaccha. As per the above given data, Section R1 is closer to B2 of urban population and forms 3% while Section R2 and R3 are closer to D and E1 of urban classification respectively forming 8% and 27%. The bottom Section R4 constitutes 33% of total population of ending up being closer to the last section of urban classification E2. Now the question might arise, how the classes are termed as high income, middle income and low income group since the classification does not involve income altogether. The answer is HPI i.e., Household Potential Index. HPI uses consumption / ownership of a whole host of durables, packaged goods, services and demographics, to construct a simple aggregate index of how much purchasing power a household exhibits. The concept underlying the index is simple - households owning or using a low penetration item or having a less popular demographic characteristic (like high education levels) get a higher score for that. The scores are then aggregated across all items and a HPI score arrived at for the household. Thus in place of income, we have a sort of "consumption" / "ownership" / "characteristics" based index which is a measure of purchasing power. Again, the score for any category is simply done, eliminating all judgement. It is the reciprocal of the penetration of the category in the total universe. Thus if 70% have a television, then television ownership in a household generates a lower score on power / potential (1/70), but if only 10% have an air conditioner, then air conditioner ownership in a household gets a higher score (1 / 10). The raw scores aggregated across all items

included in this index are then normalized on a 1 to 1000 scale. Further, within a broad category, premium versions of it are treated differently - example, a black and white TV, a colour TV and a flat screen TV. Based on this HPI score, the relative purchasing power of each SEC is as below

Source: survey conducted by Hansa Research for the Media Research Users Council, MRUC.

For the first time, on a sensible common scale the rural SECs and the urban SECs have been compared. This eliminates the differences in how they think about income (since these types of income surveys measure respondent's perception of their own income, without any cross checks). The R1 social class, the top end of rural is between B2 and C of urban, closer to B2. therefore, we would say that there is one top band of purchasing power in India, Urban A1A2, comprising about a little over 6 million households; Then there is the next band, which we believe would qualify for the 'middle class India" label, comprising B1R1B2C, between them, harbouring 30 million households; The ABCR1 target group which would form the broadest possible target group for most consumer goods is about 35.4 million

households, and 132 million individuals over the age of 12. This target group grew 26.9% between the years 2000 and 2005. Then there is the lower middle, comprising DE1R2 which is about 37 million households, where we believe that most Bottom of the Pyramid activities should begin. The lowest income, are the E2R3R4. These households form the bottom 60% of the population by income, but account for an income share of 30%. Perhaps there is fortune, after all, at the bottom of the pyramid! However the conclusion given here is on the overall basis, where the categorization may differ for different products. To understand, consider an example: A trader whose monthly household income (MHI) is more than that of a person in section A cannot be included in this SEC because his educational qualification or occupation does not qualify him for inclusion. However, there always exists a debate if this bifurcation really shows the true picture. Because if a person belonging to Section A1 has high income then it may not be true for the person who belongs to section B2, though they both are categorized as high income group. Thus even in high income group, the income variation and status differs which marketers dont notice before selecting media for advertising their product.

SEC is an indicator or a pointer towards the likely to consume set but often defies the reality of not pointing clearly towards the consuming class, which is the purpose of any targeting by any marketer. The drawback of using Monthly Household Income (MHI) lies in the difficulty of capturing the correct dataThus, with nothing as an exception to the drawbacks is acceptable too to most of the marketers.

Understanding Class: Media

As discussed earlier, the focus is now shifting from mass to class concept. However, in spite of that, there are many media which though trying hard to focus on class have yet not been able to penetrate as an effective medium to attract the classes. Undoubtedly, with an increase in awareness among the marketers, there have come up few media that have been successful in attracting classes especially in television that attracts elite class like NDTV good times and Zoom. Whereas the magazines like Femina, She, etc, are of the commonest choice of magazines among higher middle class and higher classes. Special focus on class media not only helps marketers to make a deep impact on the consumers mind but also to capture the top of the mind state which has become very essential in this one of the fastest growing sector. Apart from this, there is also need of understanding consumers needs or requirements as well as the standard of living, thought it is very difficult to judge every consumers needs, a class is a good representation on collective basis. Marketers in India have traditionally focused their attention and marketing effort on the higher socioeconomic classes (otherwise called SEC A&B). Both they and their advertising agencies have found these segments easier to understand and identify with. It has been believed that they are more easily targeted through the traditional mass media. The language and tone of voice used to communicate with this segment has a more familiar and comfortable ring to it. But it is now perhaps time to examine the relevance of mid and low socioeconomic classes ( SEC C, D&E) who, over the last decade, have slowly but surely grown in economic power and today contribute significant volumes to a number of product categories. But then marketer has to understand that the reach of media in both urban and rural India is not the same. Thus marketers have to advertise knowing what the best possible options for them are. Looking at the urban and rural reach, following conclusions have been made. Urban reach

Television has the highest reach in urban areas and reached more than 75 per cent of the urban population in 2007. The most significant change, in media consumption, in the last decade has been an increase in the importance of television in the lives of the Indian consumer. Currently more than 70% of the adult (15+) urban population watches television all seven days a week vis--vis just 40% 10 years ago. On a weekday, the average viewer watches television for around two and quarter hours. Television could slowly replace social interaction in all its traditional roles of opinion maker, informer, entertainer and influencer. However, the real change is the increase in the frequency with which viewers watch television. Television seems to have moved on from being entertainment to be indulged in on holidays to being part of the consumers daily routine. Now only more than 70% of individuals belonging to the SEC D&E households and more than 80% individuals belonging to SEC C households watch television seven days a week in comparison to 90% individuals belonging to SEC A households. The print medium has the second highest reach in urban areas, with 35 per cent penetration. The percentage reach for the print medium denotes average issue readership. After print comes radio with 20 per cent reach and then comes cinema with close to 12 per cent penetration. The percentage of the population mentioned listened to the radio at least three days a week and went to the cinema at least once a month.

On the basis of sex, the penetration of all media remains less for females than for males in both urban and rural areas. In urban India, TV reaches 75 per cent of males and 74 per cent of females. Press permeates to 46 per cent males and 27 per cent females. Radio has 24 per cent and 19 per cent reach for males and females, respectively. Cinema reaches 10 and 3 per cent males and females and the Internet reaches 6 per cent and 2 per cent males and females, respectively.

Looking at state wise reach in urban areas, television has the highest reach in all the states, including Chandigarh, Delhi and Goa. All three states reveal 87 per cent penetration. TV

has

the

lowest

reach

in

Bihar,

with

only

49

per

cent

penetration.

Radio has the highest reach in Tamil Nadu 40 per cent and the lowest reach in Punjab 9 per cent. Cinema is most successful in Andhra Pradesh, with 20 per cent reach, and least effective in Goa and Himachal Pradesh, with only 1 per cent reach in each state. The Internet is most useful as a medium in Delhi and Goa, with 12 per cent reach in each state, and the least used medium in Gujarat. Rural reach The penetration of all these media is relatively different in rural India. Television continues to be the medium with the highest reach, but penetrates only 38 per cent of the huge rural population in the country. Radio overtakes print in rural India and becomes the medium with the second highest reach. Radio reaches to the 18% of the rural population. The penetration in rural of areas print is 39 is 15 per per cent cent. for Cinema, and like 35 per in urban cent for India, women Looking at the reach of the various media on the basis of sexual division, TVs penetration men State wise reach is highest for television in Goa, with 83 per cent penetration; it is the lowest in Bihar, with 11 per cent penetration. Radio, like in urban India, has the maximum reach in Tamil Nadu (40 per cent) and the minimum reach in Andhra Pradesh (3 per cent). Print is most effective as a medium in Kerala again, with 62 per cent reach, and least effective in Madhya Pradesh, with only 4 per cent reach. Cinema follows the same trend in rural India as in urban India and has the highest reach in Andhra Pradesh 20 per cent. The medium has the lowest reach in the states of Bihar, Gujarat, Haryana, Chhattisgarh, Orissa, Uttar Pradesh and West Bengal 1 per cent penetration in each of these states.

CLASS ADVERTISING

Understanding target and media selection

Factors to be considered for targeting class customers and selecting media
Identification of the target class is extremely essential before offering both a product /service as well as advertising and selecting media for the same. Thus, understanding the product itself is an important thing. When a marketer markets a product, seldom he markets the one which is for all the classes, other than basic items like salt. However, though there might be many such products catering to all the classes the ratio is too low to compare its penetration against items that targets classes. So how can marketer decide whom to target? First, the main consideration is affordability of the consumer because only then, the wants are converted to demand for the product/service. Secondly, to what extent the consumer is ready to accept. And if the results show positive response the next question arises is what advertising media should you use to promote your business? Simple. Use the one that is most influential and believable, and that comprehensively reaches the highest percentage of your target audience for the lowest cost.

Media Preference
Until last century, people had not many options as far as media is concerned. But with the advent of new media and global competition, not many are left behind in attracting people. However, before the selection of any media to advertise, one of the most important things to be taken into consideration is that what consumers prefer as far as media selection is concerned. Thus, there might rise questions like:

What is consumer preference?

Why is it important for an advertiser to know the preference? Where should an advertiser advertise for the products or services? The answer is, no one can say anything for sure what a consumer prefers. It is an everlasting ongoing process of sticking to one media at some point and switching to other at the other point. Preference for media is thus cannot so be so easily predicted. But when we talk about class advertising, it can be said that the overall preference for the people belonging to the same class remains same. That is instead of individual choices, class preference show an inclination towards certain media that might help an advertiser to choose the media for advertising in a better manner. For knowing the selection patterns existing among the people, following is the research conducted to know the class preference (restricted to Ahmedabad, Urban)

Research Methodology

Research Methodology
MEANING OF RESEARCH METHODOLOGY: When you say that you are undertaking a research study to find answers to a question, you are implying that the process; 1. is being undertaken within a framework of a set of philosophies ( approaches); 2. Uses procedures, methods and techniques that have been tested for their validity and reliability; 3. is designed to be unbiased and objective . Philosophies mean approaches e.g. qualitative, quantitative and the academic discipline in which you have been trained. Validity means that correct procedures have been applied to find answers to a question. Reliability refers to the quality of a measurement procedure that provides repeatability and accuracy. Unbiased and objective means that you have taken each step in an unbiased manner and drawn each conclusion to the best of your ability and without Introducing your own vested interest. (Bias is a deliberate attempt to either conceal or highlight something). Adherence to the three criteria mentioned above enables the process to be called research. However, the degree to which these criteria are expected to be fulfilled varies from discipline to discipline and so the meaning of research differs from one academic discipline to another. The difference between research and non-research activity is, in the way we find answers: the process must meet certain requirements to be called research. We can identify these requirements by examining some definitions of research. The word research is composed of two syllables, re and search. re is a prefix meaning again, anew or over again search is a verb meaning to examine closely and carefully, to test and try, or to probe. Together they form a noun describing a careful, systematic, patient study and investigation in some field of knowledge, undertaken to establish facts or principles. Research is a structured enquiry that utilizes acceptable scientific methodology to solve problems and create new knowledge that is generally applicable. Scientific methods consist of systematic observation, classification and interpretation of data.

Although we engage in such process in our daily life, the difference between our casual day- to-day generalization and the conclusions usually recognized as scientific method lies in the degree of formality, rigorousness, verifiability and general validity of latter. OBJECTIVE: To study and provide an insight into advertising with respect to the media preference based on Socio-Economic Classification. To highlight the shift in focus from mass advertising to class advertising. To arrive at the commonest medium preferred by each SE class by application of research techniques like measurement and scaling, data interpretation, evaluation, strategy formulation for the advertisers to choose the right medium to attract specific class customers based on my primary survey. To help advertisers choose the right medium to attract specific class customers based on the primary survey. By providing strategic solution to tap the untapped potential markets

SCOPE:

The project will cover an overview of Indian entertainment and media industry and detailed study about Indian advertising industry. The main area of focus will be on socio-economic classification (SEC) i.e, Urban and rural, of the consumers. A primary survey will be done by collecting primary information thorough questionnaire. Further data analysis and data presentation would be done in order to arrive at the common preference of SEC class for particular advertising media out of Print, TV, Radio, Out of Home (OOH), internet based on weighted average preference model.

PROJECT DETAILS: AREA OF STUDY Indian Entertainment Industry: Origin and History Growth Drivers Indian Advertising Industry: Introduction Size of the industry Shift of focus from Mass to Class SEC: Demographic study

RESEARCH METHODOLOGY RESEARCH DESIGN: Exploratory Research RESEARCH DATA SOURCE: Primary Source: Questionnaires Secondary Source: Internet, publication, journals, newspapers, magazines, Business Review, Periodicals, etc. RESEARCH INSTRUMENT: Questionnaire SAMPLE METHOD: Stratified Random Sampling, Judgment sampling, Convenience sampling SAMPLE SIZE: 30 for each class (8 classes) = 240 DURATION: 1 MONTH LIMITATIONS: Time limit Cost constraint Inability of covering all the aspects related to the Indian Media and Entertainment sector as well as advertising industry due to its wide scope. Data was not enough for research.

Data Analysis & Interpretation

TV EXPOSURE

The results show that the classes B1,B2, C, and D have the highest Tv exposure amongst all classes. The detaled exposure to various channels is given below.

NEWS EXPOSURE

As the results show the classes A1,A2, and B1 have the highest expoure to news channels. The remaining classes have almost the same exposure to news channels. For targeting the A1,A2, and B1 classes advetisment on news channels would prove more effective as their exposure is high.

MUSIC CHANNEL EXPOSURE

As the results show all the classes have high expoure to music channels. The classes A1 and A2 have less exposure to music compared to the rest. For targeting all the classes advetisment on music channels would prove more effective as their exposure is high.

INFORMATIVE CHANNEL EXPOSURE

As the results show the classes A1,A2, and B1 have the highest expoure to informative channels. The remaining classes have almost the same exposure to informative channels. For targeting the A1,A2, and B1 classes advetisment on informative channels would prove more effective as their exposure is high. Also the classes C,D,E1 and E2 have very low exposure.

MOVIE CHANNEL EXPOSURE

As the results show the classes A1 and E1 have the highest expoure to movie channels. The exposure for the remaining classes varies greatly. For targeting the A1 and E1 classes advetisment on movie channels would prove more effective as their exposure is high.

SOPS EXPOSURE

As the results show all the classes have very high expoure. For targeting the all the classes advetisment on news channels would prove more effective as their exposure to sops is high.

D.D. EXPOSURE

As the results show the classes B2,C,D,E1 and E2 have the highest expoure to D.D. channel. The exposure for the remaining classes is not applicable. For targeting the B2,C,D,E1 and E2 classes advetisment on sop would prove more effective as their exposure is high.

NEWSPAPER EXPOSURE

As the results show the classes A1,A2,B1 and B2 have the highest expoure to news papers. The remaining classes have almost the same exposure to news papers. For targeting the A1,A2,B1 and B2 classes advetisment on news papers would prove more effective as their exposure is high.

ENGLISH

As the results show the classes A1and A2 have the highest expoure to english news papers. The exposure for the remaining classes is not applicable. For targeting the A1 and A2 classes advetisment on english news papers would prove more effective as their exposure is high.

LOCAL LANGUAGE

As the results show all the classes have very high expoure. For targeting the all the classes advetisment on local language news papers would prove more effective as their exposure is high.

ENGLISH + LOCAL LANGUAGE

As the results show the classes A1,A2 and B1 have the highest expoure to both english and local language news papers. The exposure for the remaining classes C,D,E1 and E2 is not applicable. For targeting the A1,A2 and B1 classes advetisment on english and local language news papers would prove more effective as their exposure to is high.

CINEMA EXPOSURE

As the results show the classes A1,A2,B1,B2 and C have the highest exposure to cinema. The remaining classes have almost the same exposure and that is very less. For targeting the A1,A2,B1,B2 and C classes advetisment on cinema would prove more effective as their exposure is high.

MAGAZINE EXPOSURE

As the results show the classes A1,A2,B1and B2 have the highest expoure to magazines . The exposure for the remaining classes C,D,E1 and E2 is not applicable. For targeting the A1,A2,B1and B2 classes advetisment in magazines would prove more effective as their exposure is high.

INTERNET EXPOSURE

As the results show the classes A1and A2 have the highest expoure to internet. The exposure for the remaining classes C,D,E1 and E2 is not applicable. For targeting the A1and A2 classes advetisment in magazines would prove more effective as their exposure is high.

OOH

As the results show all the classes except B1 and B2 have very high expoure. For targeting the rest of the classes advetisment on OOH would prove more effective as their exposure is high.

RADIO EXPOSURE

As the results show the classes A1and A2 have the lowest expoure to radio. The exposure for the remaining classes B1,B2,C,D,E1 and E2 is very high.

Finding

Findings
1. Above study it is clean that the highest TV exposure amongst to the all Class. 2. The highest exposure of the public to the new channels. 3. All the classes have high expoure to music channels. The classes A1 and A2 have less exposure to music compared to the rest. 4. The highest expoure to news papers.

RECOMMENDATIONS

RECOMMENDATIONS
Extensive research by companies, advertising agencies or market research firms can help understand the exact exposure relations of the various socio economic classes to the various media. Research can also be undertaken to understand the exposure level of various classes in the rural area to various media. Concrete findings can help companies in reducing advertising expenditure by concentrating on the right media to reach to target audience. Also, the companies media budget can be used wisely. Not necessarily does the company have to cut back on its advertising expenses.

CONCLUSION

CONCLUSION
The Indian Advertising Industry being one of the fastest growing area of not only the IE&M but also the Indian Economy, has a huge potential for further development. The experience of knowing the insights of the Indian Entertainment and Median Industry as well as the Indian Advertising Industry was enriching. It gave some of the true picture of the industry with which I was totally unaware of.

The understanding of the preferences of the various classes to different media and their exposure to it can help advertisers target the right audience using the right media. Thus targeting the right audience for the advertizing and choosing a specific media can help advertisers save a lot money in advertizing.

BIBILIOGRAPY

BIBILIOGRAPY
Kotler, Philip: Marketing Management, Eleventh Edition, PHI Kothari C. R.: Research Methodology Bijapurkar, Rama: We Are Like That Only, Understanding the Logic of WEBSITE:http://www.iamai.com http://www.egyankosh.com http://www.quirks.com http://www.mckinsey.com/mgi/publications/india_consumer_market/images/India_In teractive1.swf http://www.indiantelevision.com/mam/headlines/y2k2/apr/apr2.htm

ANNEXURE

ANNEXURE
Questionnaire
QUESTIONNAIRE ON MEDIA PREFERENCE (SEC)
N.B.: 1) Please tick () the boxes for your response and leave the others blank. 2) Please rank in the order of preference wherever mentioned. 3) The information collected in the survey will be kept confidential and used only for the research purpose.

(Please select only one option under each question) 1. Occupation: ( ) Skilled workers ( ) Petty trader ( ) Professional ( ) Unskilled workers ( ) Clerk ( ) Senior executive ( ) Shop owner ( ) Supervisor ( ) Junior executive ( ) Employer of < 10 persons

( ) Employer of > 10 persons ( ) Employer of None

2. Education: ( ) ( ) ( ) Illiterate School certificate Post graduate ( ) < 4 yrs in school ( ) Some college ( ) 5-9 yrs of school ( ) Graduate

3. How much radio do you listen to? ( ) ( ) 0-15mins ( ) 15-30mins ( ) ( ) 30-45mins 2-3hrs ( ) 3-5hrs

45-60mins ( ) 1-2hrs

4. How much TV do you watch per day? ( ) ( ) 0-15mins ( ) 15-30mins ( ) ( ) 30-45mins 2-3hrs ( ) 3-5hrs

45-60mins ( ) 1-2hrs

5. How much time do you spend on watching news per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs ( ) 2-3hrs ( ) 3-5hrs 6. How much time do you spend on watching Music channels per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs ( ) 2-3hrs ( ) 3-5hrs 7. How much time do you spend on watching Informative channels (ex: discovery, national geography) per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs ( ) 2-3hrs ( ) 3-5hrs 8. How much time do you spend on watching Sops channels per day? ( ) ( ) 0-15mins ( ) 15-30mins 45-60mins ( ) 1-2hrs ( ) ( ) 30-45mins 2-3hrs ( ) 3-5hrs

9. How much time do you spend on watching D.D. (All doordarshan channels) per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs ( ) 2-3hrs ( ) 3-5hrs 10. How much time do you spend reading newspapers per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs 11. In which language do you read newspapers? ( ) English ( ) Local language ( ) Both

12. Which type of newspapers do you read? ( ) General ( ) Business ( ) Both

13. How many movies do you watch in a month (in theatres)?

( ) 0 ( ) 1 ( ) 2 ( ) 3 ( ) 4 ( ) 5-10permonth 14. How many magazines do you read per day? ( )0 ( )1 ( )2 ( )3 ( )4 ( )5

15. How much time do you spend on internet per week? ( ) 0-1hours ( ) 1-5hours ( ) 5-10hours ( ) 10-20hours ( ) 20-25hours

16. How much do you travel per day? ( ) 0-5kms ( ) 5-10kms ( ) 10-15kms ( ) 15-20kms ( ) 20-50kms