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Tuesday, November 27, 2007

Newspaper or Waste Paper

Every morning my local newspaper reaches a new low in journalistic performance. The matter has come to such a state that I can trash my entire newspaper without even looking at it once and I wont miss anything.

Newspapers as they exists, seem doomed. They cannot fight television in terms of speed. The Internet beats the newspaper in terms of ability to cross-linkages ease of being discovered.

On top of it, it is really difficult of attract and retain a set of readers that advertisers would love to sell to. With money in the hands of people across the intelligence and vocations spectrums, tabloidisation seems the easy solution. Yet, it is now time newspapers realised that tabloidisation is not going to get them anywhere.

When I read in Indian express the interview of two very senior journalists - Tina Brown and Harold Evans - about this very subject, I hoped change would be round the corner. But apart from the comment that highlighted the importance of websites for the newspaper there wasn't much to look forward to. So what do newspapers do?

Step 1: Differentiate or Die - Playing the marketing game right!

Jack Trout provides clear solution, that must be the answer. Newspaper publishers should differentiate among themselves, within themselves and within their readers to survive. While most companies know about the strategy, few know what to differentiate between.

Differentiating the consumers - i.e. the readers!

Typically, for a family newspaper, readers are diverse. At the most macro level, diversity exists between families. Drill down and there also exist a diversity within each family unit in terms of age groups, maturity and gender. The appeal of each class, as created above, to the advertisers actually decides the target group. Analysis of consumption basket of target group coupled with typical annual advertising spends by brands in corresponding categories will logically decide best target segment.

Differentiating the content - guiding the eyeballs

Within a target household, there also exists diversity between roles of the readers. These can be classified into Skimming (glancing across headlines) and Analysis (in-depth coverage on headlines that catch attention). The content layout needs to be optimised for guiding the relevant household member to relevant page.

Standardizing the layouts effectively guides eyeballs. It also helps guide eyeballs if used creatively, case in point being the Google logos!

Differentiating within - between the covers

First and foremost, newspapers must differentiate within the pages. Newspapers have a systematic classification that puts city news on one place, political news on other place. From users point of view, it hardly makes any a difference unless the user can read into the classification. Newspapers seem to have forgotten that the classification must be based on users rather than news. That is the reason, why page 3 is called page 3. It would be great if newspapers can create brands out of their pages as successfully as "page3" brand was created.

For example, any mainstream newspaper may decide to addresses families of working families as their core target audience. Newspapers/periodicals are also known to target college going kids specifically. But as their audience is generically diverse - it is necessary pages are segregated properly so that advertising efficiency may be increased.

Step 2: Playing the production game right

Newspapers need to address "news production" a little differently. Current news production process can be classified into event reporting, reporter investigation, content generation, editing and finally delivery. Let us first enlarge this process by adding "follow-up" to it. As far as I understand, it is the news agencies that do the event reporting. The real winning strategy for a newspaper, therefore, needs to reside in the later part of the "news production" process.

Using reporter investigation better

As Goldratt mentioned in The Goal!, newspapers must optimise the process on their constraint. Clearly world class reporters are the constraint in this case! Using the same reporters and content they have generated, can a newspaper publisher create various stories that can move from plain event reporting to analysis of social issues behind the event. I believe they can. The process is called versioning. Content generated by reporter investigation can be versioned to feed into the headline breaking news story, the reporter's blog or a deeply researched piece. In fact newspapers often have lots of versions of the story write-up ready. (These days they literally have lots of versions of facts - hence had to specifically mention "write-up"). To be able to achieve this, content created by the reporter needs to be redefined. On this redefined content publishers can unleash different sets of editors to make the story readable for different audiences.

In essence one set of reporters can create many newspapers without much cost addition. Alternatively, news can be versioned across editions. E.g. City in the story can have detailed write-up whereas other city editions can have shorter versions!


Once my boss remarked that if follow-up was an industry it would be the biggest industry! Websites give newspapers a mechanism to follow-up with their customers. Still if you read online content, it is an exact replica of the printed content. This, to my mind, defeats the purpose of the website.

Using IT effectively!

Internet should have allowed all the newspapers to have faster reporting. If all the reporters could upload their stories onto a central database, tag it properly. An intelligent editor with local knowledge can simply check-mark and get the edition out. This will enable the newspapers to create as many papers as they want.

In sum

Newspapers are an area where there is lot of potential for creating value. Steps indicated above are just outsiders view of the industry. Insiders can really create more and better avenues delighting us readers with well created, updated and analysed news in a crisp newspaper!

Thursday, November 22, 2007

"In-tell"ing the "idiot box!

I have just been disappointed with my channel surfing experience. This isn’t the first time and surely won’t be the last. Indian television is at its lowest ebb. Not surprisingly, the advertising rates are among the lowest in the world.

Making the idiot box smarter - adding intelligence!
I believe television today is simply too dumb! Most of the soaps tend to take generation leaps making some characters as old as 800years and counting. I guess it is time to use television as tool for information dissemination. Look at the videos of John Bird and John Fortune, about sub-prime crises and credit crunch. They use humour to make people aware about some aspects of happenings in the financial world that are, in all probability, soon going to make life miserable for common man.

Yet all we have managed is to put humour to some crappy idiotic use in prime-time news.

Possibly only Vir Das (below) and Cyrus Brocha have managed to entertain intelligently using humour on news channels.

Intelligence is waning - Channels please wakeup!

I guess this is but just one example. But I guess it should suffice as there is not much opinion against my views. It is time channels and advertisers realised that programming catering to intelligent audience tends to be sticky. The intelligent viewer is intelligent enough to come back to the program and builds a solid "discussion universe" around the program attracting more "intelligent-aspirers" to the fold.

In Sum

Its time to rethink about the customer, about our assumptions of their intelligence and relook at what we are offering to the world. In the long run, well made intelligent programs will create their following and will bring viewers back to the channel. I am sure by making programming relevant to the people the channels can create a sticky customer. Let us hope the channels have some "intel" inside their organisations! Now isn't it what advertisers want to pay quality bucks for?

Sunday, November 18, 2007

Real Estate: Where are we "real"ly?

Urbanisation of India has baffled me. Indian cities are a picture of most shoddy infrastructure and yet command more price than any other city in the world. Unlike Singapore, India has large land mass and there is no dearth of land supply. Also unlike other high cost cities, India’s per capita income does substantiate the prices in India. Therefore, what is happening and where will this lead?

Why prices are increasing?

The prominent reasons for increasing prices are said to be:

  • Income and demographics
  • NRI purchases
  • Constrained urban infrastructure and hence higher pricing for currently available infrastructure
  • Constrained low cost land supply
  • Higher migration into established urban centers

Income and Demographics point to a different reality
This is the most abused story of all. If only people started looking at incomes and demographics, they will realize how outrageously prices have moved. The current incomes and spending patterns cannot support these residential prices or create enough spending to justify retail real estate prices.

NRI investments may not have an exit!
At current levels, housing is only affordable to NRIs with higher per capita income in relation to local population. However, if these purchases are investments then there has to be an exit route at higher prices for encashing the gains. Ultimate sustainable exit must be through selling to the local population. Crude calculations show the un-sustainability of this logic. In essence, the NRI investment theory may not find and exit route!

Constrained supply of low cost land is a cock and bull story!
Developers looking to acquire lands in or near the traditional CBDs are driving up the cost land. This is totally artificially created bottleneck and can be resolved using regulatory measures as seen in China.

Infrastructure constraints are government created
Lack of urban infrastructure is completely artificial, created by successive governments’ lack of vision. It has been years since government opened any new public schools, municipal offices, and water and sewage treatment facilities. The accumulated impact of this has reached a critical threshold where it has started affecting the cost of living and doing business in the city.

Higher migration into established urban centers is a key concern
Of all the reasons this represents the most critical and believable reasons. The job creation outside of the current urban centers is abysmally low. This is leading to in-bound migration across income classes.
At higher income level, it is raising prices in high-end localities. Therefore, we have the posh areas appreciating higher and faster than rationally acceptable rate. This phenomenon also brings in lower transactions leading to lower supply assimilation.
At the lower income side, slum population is increasing. Government is letting the migrant population encroach upon and absorb government and private land leading to artificially reducing the cost of living and doing business for current urban centers. This is a negative spiral as it reduced the incentives for economic activity to move out of the city. Thus, new investments in upcoming urban centers do not yield returns whereas old urban centers continue to become more congested. Consequently, emerging cities are missing the potential growth.

In sum
Governments lack of concern for living conditions, lack of foreseeing infrastructure requirements and lack of respect of property and assets is leading us down a dangerous spiral. Globalization has created ample infrastructure to let global cities compete against each other at a level playing field. Cities in Philippines, Malaysia and other south-east Asian countries are taking a lead and Indian cities will soon be left behind cursing the lost opportunity.

Friday, November 09, 2007

Selling costly products to the bottom of the pyramid!

When phones, televisions and many other costly products came to Indian villages, they were bought by few and used by many at low (or no) cost. In early days, such wonderful devices did not sell as much as they should have. Is there a way to sell such products well before they become affordable for the masses? Possibly! Let us examine the case of one product that is going through the exact same phase - the massage chair!
The massage chair!
Recently a cinema theatre we frequent put-up OSIM massage chairs. The chair is awesome and a full body massage takes about 20-25 minutes with lot of customizations possible. This massage chair from OSIM represents costly, high maintenance equipment that is not a daily use item. Using it requires a comfortable, private setting where one can enjoy the relaxation from the massage.

Converting product into service – a massage chair “Laundromat”
Imagine “OSIM massage parlours” wherein one gets to use the chair for fixed fee. This concept can be developed similar to Laundromats. Lot of such chairs can be made available in these “parlours” with a personal cubicle.
These parlours need to be placed where:

  • People with aching backs and bodies are present i.e. airports, gymnasiums etc.
  • People have some time on their hands - malls, cinema theatres, spas and hotels etc.

So this single product can be made into many “services” e.g. a simple massage, aroma massage (with choice of fragrances being sprayed in the cubicle), relaxation lights and sound package etc. The concept also opens up a lot of various options for allowing people to experiment with scented relaxation-candles, special relaxation music etc. The possibilities are enormous. The idea will definitely catch on resulting in product sales the company may not even have imagined! What say?