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A Project On CLASS ADVERTISING

In partial fulfillment of the requirement of two years full time Masters of Business Administration (MBA) Programme (2009-2011) Of Amity University, Noida
PREPARED BY: Surbhi Misra, Shubhashish Banerjee, Diploo, Abhishek Singh, Mansi, Nirmal MBA (2009-2011)

AMITY GLOBAL BUSINESS SCHOOL
NOIDA CAMPUS AMITY UNIVERSITY

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CONTENTS
PART I Executive Summary…………………………………………………….i The Indian Media & Entertainment Industry An Overview……………………………………………………….1 Categories and Growth………………………………………….4 Advertising Industry An Overview………………………………………………………10 As a part of IE&M…………………………………………….....12 New Trends……………………………………………………....16 Scope of Ad Industry in India………………………………....17 PART II Mass V/S Class Advertising…………………………………………..18 Shift from Mass to Class………………………………………………23 Class Advertising: Meaning…………………………………………..26 SEC: A debate…………………………………………………………...34 SEC: Understanding Class Demographics……………………………………..………39 Media………………………………………………………..44 Understanding target and media selection…………..48 SEC: Media Preference Research Study…………………………………………………… Findings……………………………………………………………..

PART III Conclusion……………………………………………………….. Bibliography……………………………………………………... Webography……………………………………………………… Glossary……………………………………………………………

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Annexure Questionnaire……………………………………………..

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: SocioEconomic 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 3

Effectiveness. 4 . The project is concluded with the brief strategies/ suggestions and the survey reports that would be of immense help to identify and choose the right media for the advertiser based on SEC.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. that calculates the overall preference of the people based on four parameters Reliability. Also the comparative preference model. 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.

strategy formulation for the advertisers to choose the right medium to attract specific class customers based on my primary survey. 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 5 . To arrive at the commonest medium preferred by each SE class by application of research techniques like measurement and scaling. evaluation. 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. internet based on weighted average preference model. Urban and rural. data interpretation. TV. The main area of focus will be on socio-economic classification (SEC) i. of the consumers. Radio.Research Methodology OBJECTIVE: • To study and provide an insight into advertising with respect to the media preference based on Socio-Economic Classification.e. A primary survey will be done by collecting primary information thorough questionnaire. • • To highlight the shift in focus from mass advertising to class advertising. Out of Home (OOH). 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.

Convenience sampling SAMPLE SIZE: 30 for each class (8 classes) = 240 6 .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 SEC: Media preference through research study Research Findings Strategic Solution RESEARCH METHODOLOGY RESEARCH DESIGN: Exploratory Research RESEARCH DATA SOURCE: Primary Source: Questionnaires Secondary Source: Internet. publication. Judgment sampling. newspapers. RESEARCH INSTRUMENT: Questionnaire SAMPLE METHOD: Stratified Random Sampling. etc. Business Review. magazines. journals. Periodicals.

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. 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. and the income levels too have been experiencing a high growth rate. liberalization and others in the past decade which has led to the higher chances of growth to the industry. technological.discretionary sectors like retail. The increasing rate of urbanization. telecom. and hotels among other sectors. demographic. It has seen many changes in terms of economic. 7 . The Indian economy has been growing at a fast clip over the last few years. Media sector is no exception to the trend. The E&M industry generally tends to grow faster when the economy is expanding.An overview Changing consumption patterns. The Economic influence: The Indian Entertainment and Media (E&M) industry has out-performed the Indian economy and is one of the fastest growing sectors in India. rising aspiration levels and increase in the number of middle-income and upper-income households has led to growth in non.

print media and radio. The FM radio sector too was opened for foreign investment with 20% FDI being allowed. spending power has steadily increased in India. Liberalizing Foreign Investment: Today India has probably one of the most liberal investment regimes amongst the emerging economies with a conducive FDI environment. In the print media segment. FDI was permitted in two important sectors . higher penetration and suitable regulations. higher quality content. 100% FDI is now allowed for nonnews publications and 26% FDI is allowed for news publications. and other interactions leading to higher aspirations. It represents the fourth largest economy in terms of ''purchasing power parity''. Thus. India has registered the fastest growth among major democracies. television and other segments are already open to foreign investment. The E&M industry has significantly benefited from this liberal regime. Printings of facsimile editions of foreign journals are now also allowed in India. E&M industry is also expected to significantly benefit from this fast economic growth The Demographic Influence: Over the years. The Technological Influence: India is witnessing a revolution in this sector with the emergence of new technologies. Lifestyle changes brought about by changes in economic activity are also spurring growth of the Indian E&M industry. In urban areas of India. This policy is helping foreign journals save on the cost of distribution while servicing the Indian market audiences more effectively. Exciting new developments in the technologies used in Media and Entertainment industry are taking place. The Indian rural market with its vast size of nearly three times of urban India. Films. the consumer mindset is changing due to increased exposure to global influences via media.Over the past few years. 8 . This growth is led by better technologies. The IEM has moved from the growth phase to the inflection phase. In 2005. also offers a huge opportunity that has remained largely untapped due to reasons of accessibility and affordability.

efforts to increase the penetration even slightly in these lower socio-economic classes are likely to deliver much higher results. Going forward. mobile marketing. While today the low ad spends may seem like a challenge before the E&M industry. the absolute numbers are much higher for these classes. and basic cable analog to broadband internet. Advertising revenues are vital for the growth of this industry. Hence. 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. it also throws open immense potential for growth. Thus given the high rate of economic growth and technological developments. the use of Internet and personalized communication with the help of the same. One such company is city based Net Hot Zone Media Pvt. multiplexes. simply due to the higher base. and interactive television are going to hit the markets thereby changing the media scenario. gaming zones.The change is already being witnessed from AM radio to FM radio. Many companies are taking initiatives to set up their business all over with the help of such technology. Low Media Penetration in Lower SECs: Though media penetration is poor in lower socio-economic classes. single screen theatres to multiplexes. Low Ad Spends: Indian advertising spends 0. This potential can be estimated by the fact that even if India was to reach the global average. which is very low as compared to other developed and developing countries. DTH.34% of GDP. new distribution channels. 9 . advertising revenues would at least double the current revenues. IP-TV. Animations. All these factors will favour the growth of Media and Entertainment industry in India. are redefining the media and entertainment industry. Indian Media and Entertainment industry is poised to register a tremendous growth in the coming years.

Entertainment and Media Industry has recorded a growth of 17 per cent in 2007. it is just 0. However though Indian Entertainment and Media (IEM) is one of the fastest growing sectors in the economy.7% of the global US$ 1. In the last four years (20042007). the industry recorded a cumulative growth of 18% on an overall basis. over 2006.4 trillion media industry 10 .Categories and Growth The Indian 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.

music and internet. As per PwC. Out of home advertising (OOH) and live entertainment are too gaining importance. 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. As mentioned above. films. Internet penetration would take time to mature. However. print. radio. Present and projected growth in E&M industry* (in Rs crore) 2006 Television 19.The IEM is divided into different segment like Television.120 2007 21. India will be one of the key drivers in pushing the global entertainment and media industry.900 2008 26.900 CAGR 22% 11 .600 2009 33.100 2010 43. it is expected to grow at a CAGR of 18% till 2011 to touch Rs 1 trillion from Rs 436 b in 2006.100 2011 51. radio and OOH would also witness high growth rates. Television and print would continue to remain the largest segments. Internet.

5020 23.670 18.500 1.Print Media Film Entertainment Radio Music OHH Advertising Live Entertainment Internet Total* 12. New distribution platforms like DTH and IPTV will only increase the subscriber base and push up subscription revenues.100 270 49810 16. This leads to the demand for more Indian content from India. 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 Television Industry Amongst the segments of the industry.00% 18% Source: Industry estimates & PwC analysis *Note: The figures taken above include only the legitimate revenues in each segment.600 1.200 1.600 600 740 1. the television industry will continue to contribute the largest share.300 420 58.150 1. Film Entertainment 12 .200 11.100 760 1.200 12.700 870 2. 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.000 900 160 43.400 1.200 800 750 1.600 1.800 820 8.600 14.790 8. more people in rural and urban areas are reading newspapers and magazines today. is projected to grow at 13% (CAGR) from year 2006-2011. growing need for content and government initiatives that have opened up the sector to foreign investment are driving growth in print media.170 13% 16% 28% 4% 17% 16% 43.900 1.600 1.400 800 1.560 20. Print Media Industry The print media industry.900 950 100. A booming Indian economy.200 17. Also.450 500 720 1.400 9.600 600 69. there is more interest in India amongst the global investor community. comprising of newspaper and magazine publishing.640 14. With the literate population on the rise.

Live entertainment 13 . These factors along with privatization of a large number of frequencies as part of the FM II Radio Policy will drive growth. is projected to grow with the highest CAGR till the year 2011. In 2005. 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. outdoor advertising is very popular as corporations abroad have recognized the outdoor media as a very popular medium of advertising. digital music has witnessed a surge that will propel this industry in the next five years. Advancements in technology are helping the Indian film industry in all the spheres-film production. Radio The radio industry. The industry is getting increasingly corporative. OOH advertising is expected to be the fourth largest segment of IEM industry by the year 2011. 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. the government opened up the sector to foreign investment along with migration to a revenueshare scheme.The Indian film entertainment industry is projected to grow from the present size of Rs 9600 crores to Rs. New concepts like satellite radio. Music While physical sales in the music industry continue to be hampered by piracy and falling prices. film exhibition and marketing. fuelled by the positive FM-II Radio Policy. 17500 crores. visual radio and community radio have also begun to hit the market.

films. 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. implying a 22% cumulative annual growth over the next five years. albeit from a small base. the projected yearly growth rate of the ad industry is to stabilize at 11%. and sports events are increasing rapidly. 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.Live entertainment is a huge source of revenue for the global Media and Entertainment industry.is growing at a fast and steady rate. 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. Until such time. Others Amongst the other segments. it is expected to be 4% by the year 2010. helping the sector grow at a fast rate. The growth of online ad industry is estimated to shoot up to 43% by the year 2011. especially in India’s entertainment sector. the animation and gaming industry is expected to show the maximum growth. The number of corporate awards. The animation and gaming industry is projected to grow from the present size of Rs 11 b to Rs 29 b by 2011. Live entertainment . 14 . While internet advertising comprises nearly 0. However. television.5% of advertising at present. even though India is ranked eighth in the world in terms of number of internet users.sometimes also called event management.

MUSIC LIVE ENT. The industry needs to fight all roadblocks. 15 . the impetus from the economy.in a concerted manner. Thus The Indian entertainment and media industry today has everything going for it .such as piracy.2007 2011 1% 19% 1%2% 2%1% 45% 17% 1% 1% 2% 2% 2% 52% 29% 23% TV FILM ENT. world class end products. 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.be it regulations that allow foreign investment. MUSIC LIVE ENT. while churning out high-quality. on its part. All it has to do is to cash in on the growth potential and the opportunities. needs to play a more active role in sorting out policy-related impediments to growth. The entertainment and media industry has all that it takes to be a star performer of the Indian economy. the digital lifestyle and spending habits of the consumers and the opportunities thrown open by the advancements in technology. PRINT RADIO OOH INTERNET TV FILM ENT. The government. PRINT RADIO OOH INTERNET Thus.

new areas are emerging within advertising like event management.. promote marketing system and boost economic growth. Some of the commonly used media for advertising are T. all of them use some form of advertising in order to be able to communicate with the target audience. websites. Today. Advertising is one of the aspects of mass communication. It is an ideal profession for a creative individual who can handle work-pressure. It is also the means of informing as well as influencing the general public to buy products or services through visual or oral messages. Thus advertising forms the basis of marketing. Advertising plays a significant role in today's highly competitive world. newspapers. radio. Whether its brands. 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. image management. internet marketing etc.ADVERTISING INDUSTRY The concept of advertising existed long before we had a term for it. hoardings etc. personalities or even voluntary or religious organizations. A career in advertisement is quite glamorous and at the same time challenging with more and more agencies opening up every day. As a result of economic liberalization and the changing social trends advertising industry has shown rapid growth in the last decade. The salary structure in advertising is quite high and if you have the knack for it one can reach the top. companies. A product or service is advertised to create awareness in the minds of potential buyers. bill-boards. magazines.V. It helps to create demand. Event management is wherein 16 . Advertising is actually brand-building through effective communication and is essentially a service industry.

Television. This figure. Internet marketing has also brought about a lot of changes in advertising as Internet means that one is catering to a select group of audience rather than a mass audience. Very sophisticated software optimization and planning systems are now integral to the industry. This new advertising is pleasing the growing middle class. Image management is wherein a particular profile of an individual or an organization is projected. was less than Rs 400 crores about 2-3 years ago which means the growth has been a whopping 40%.000 crores annually on advertising and promotional activities. enabling agencies to offer a unique positioning in the marketplace to attract new business. Overview of Advertising Industry in India The structure of the advertising industry in Asia Pacific has been affected by globalization and international alignments creating a smaller number of very large agencies and the growth of independent major media buying houses. Global companies are discovering the appeal of marketing their products in India. there's definitely money to be made. Coupled with many other local players big retailing brands are spending to the tune of Rs 12. newspaper and magazine advertising and neon-lit billboards in the cities are fueling a revolution in consumer products and spawning new styles of living . movie. With a population of more than one billion. Local retailers in apparel. according to industry estimates. and a middle class that's larger than the total population of the United States. watches and jewelry have all increased their average ad spending by almost 50% in the past two years. The local firms are using all the available advertising tools from electronic to print.changing food habits. food. but it is drawing criticism from Indians concerned that it could sharpen social tensions in a country with so many poor people. fashions and home décor.events are marketed. outdoor advertising and 17 . one of the largest target populations in the world. video and radio jingles.

18 . It has become fiercely competitive and one of the country's fastest-growing economic sectors. The advertising industry in India is growing at an average rate of 10-12% per annum.even models. 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. But the boom in advertising has touched off a debate on whether the industry has developed too quickly without preparing consumers adequately. 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. A once-flagging advertising industry is booming in India.

The advertising industry itself recorded a growth of 22 percent over the previous year contributing an estimated Rs 19. The advertising industry is one the most important part of the entire Indian Entertainment and Media industry. In the last four years.5-1% which is estimated to be 4% by the year 2011. the advertising industry recorded a cumulative growth of 20 percent on an overall basis. Thus the present share of internet media in advertising is nearly 0. 36371 crores by the year 2010. the total number of people using internet in our country is far less than other countries.100 crore in 2006. the print media is the highest contributor to the advertisement revenue followed by television and outdoor advertising respectively. On the basis of the estimation made by various agencies around the world. And more people in rural and urban areas are reading newspapers and magazines today. the major chunk of which will be contributed by the print media of nearly 50%.600 crore in 2007 as compared with Rs 16. In spite of the increase in the global internet usage.Advertising: As a part of Indian entertainment and media industry. The print media industry still has the potential to grow as 236 million literate people in India are still not tapped by any publication. Print media is also the favourite segment for global investors with maximum foreign investment in this segment. 19 . At present. up from 37 percent in 2006. the reason of that could be the literacy levels rising to 551 million people in India. the advertisement industry in India is estimated to reach approximately Rs. The advertising industry contributed a share of 38 percent in the overall IE&M industry revenue of 2007.

Crores) 2005 YEAR 00H RADIO 2006 INTERNET 2007 CINEMA MEDIA YEAR 2004 2005 2006 2007 PRINT 5464 6323 6946 8591 TV 4872 5412 6200 6766 OOH 847 897 945 391 RADIO 220 317 133 215 INTERNET 58 106 155 215 CINEMA 139 145 131 194 TOTAL 11600 13200 14510 16372 20 .The following chart shows the figures of the ad spend from the year 2004-2007 and the estimated ad spend for the year 2008 against 2010.1 TOTAL AD SPEND 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2004 PRINT TV AD SPEND( Rs.

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.Thus for that past 5 years. print media has been the largest contributor to the ad industry followed by TV.5% ad spend share by the year 2010. internet as a media and advertising is the fastest growing and is expected to have nearly 4. In spite of all these. Ad market share percentage of various media year 2008 and 2010 2008 CINEMA RADIO 1% OOH 3% 7% INTERNET 2% PRINT 47% TV 40% 21 .

• • • • 22 .314 crore in revenues in 2008. The cinema medium will corner around 0.000 crore.2010 CINEMA INTERNET RADIO 1% 4% 5% PRINT 46% OOH 8% TV 36% Advertising Market Stats/Projections: YEAR 2008 • The overall advertising and media industry is expected to close at Rs 21.674 crore in 2008 The print industry stands at nearly Rs 10. Outdoor media industry will grow at 14 per cent to touch Rs 1. riding a 20 per cent growth rate Television advertising market is projected at Rs 8.454 crore.7 per cent of the total advertising budget in 2008.

With the development of the economy the development in the industry has also gained momentum. All the recent developments have helped in opening new doors for the 23 . New trends in ad industry Ad industry is one of the fastest growing sectors in the country. • The decline in share of print and TV is not only because of the upcoming media but also because the market itself is expanding.• Radio is likely to record a 40 per cent growth in 2008 to touch Rs 672 crore Internet advertising will constitute only 1.7 per cent of the overall advertising spends in 2008. It is gaining momentum as a source of information and stream of revenue.4 per cent. up from the current 1.

it has become necessary for the advertisers to constantly find newer ideas to attract the attention of the consumers. It has become extremely necessary for the advertisers to understand the needs of the customers on the individual basis. which stands second in the highest number of mobile users. 24 . blogs is an emerging way of communicating to the people. Also. mobile marketing is gaining attention of many advertisers. Mass media like newspapers. other media are overtaking television and other traditional media because of a shift towards consumer's change in perception. magazines. 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. One type of mobile ad is based on SMS (Short Message Service) text messages. radio and television are no doubt hugely effective media for commercial advertisements. the ad industry had been concentrating on mass media. The benefit of SMS text messages is people can respond where they are. According to statistics. online ad spend by the year 2010 is expected to grow at the rate of 43%. The advertisers are now opting for personalized communication than mass communication. Increasingly. but internet is completely different from them in many respects in terms of achieving the objective of an ad. Within online advertising there are many options available to the advertiser. Among that e-mail marketing tops since it is also a good option for personalized communication which is preferred by most of the advertisers nowadays. stuck in traffic. Thus. Another upcoming phenomenon is mobile marketing. With the increase in number of people having the cell phone especially India. right now.development in the industry. For the past so many years. sitting on the metro.

It is online advertising with a focus on social networking sites. particularly to the Gulf. South-East Asia. 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. This is a relatively immature market. creative and media services personnel: Indeed. • • • India's advanced IT capabilities can be used to develop Web-based communication packages for global clients. Indian talent is recognized and respected in global agency networks. Scope of Advertising Industry in India The advertising industry in India has several competitive advantages: • India has a rich pool of strategic planning. MASS V/S CLASS ADVERTISING 25 . which should provide an immediate link to global markets. we have access to this area of TV production. China. • 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. Indian advertising industry has been exporting senior-level talent to many countries. the UK and the US. Our production standards in TV and print have improved: With a vibrant animation software industry. • No other country has access to so many trained management graduates who can provide strategic inputs for brand and media planning.A new form of advertising that is growing rapidly is Social network advertising.

In theory this would directly correlate with a larger number of sales or buy in to the product. Mass advertising that refers to the approach to advertising that attempts to reach every consumer. this group consists of such a wide variety of people. From the viewpoint of marketing. their desires towards a certain product may be totally different from each other. Mass marketing/advertising Mass advertising is one of the most widely used traditional methods in advertising. Yet. mass distributing and mass 26 . 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. For most of the twentieth century. It is a type of marketing (or attempting to sell through persuasion) of a product to a wide audience.e. but relatively easy to enter because of the large amount of consumer pool available. they could be tagged as being "average". Mass market advertising is usually more expensive than direct marketing. mass is the group of consumers who occupy the overwhelming mass of a bell curve for common household products. i. major consumer-products companies held fast to mass marketing.What is mass To understand what is mass marketing/advertising. it is important to know what exactly mass refers to. The trend of mass media has seen many ups and downs. Often competition to supply the mass market is fierce. The idea is to broadcast a message that will reach the largest number of people possible. Traditionally mass marketing has focused on radio. These trends are due to corresponding upswings in mass media. By reaching the largest audience possible exposure to the product is maximized. the parent of mass marketing. television and newspapers as the medium used to reach this broad audience.mass producing. rather than targeting a particular market segment.

Coke and Pepsi for clearing doubts in the pesticides case). sex. television has become one of the most 27 . How mass media markets? The mass media are capable of facilitating short-term. Evidence of achieving these three tiers of objectives is useful in evaluating the effectiveness of mass media. creating awareness and knowledge (e. altering outdated or incorrect knowledge (AIDS campaign.g.g. which leads to the lowest costs in terms of long term investment. and maintenance of behavior change. television offers sight and sound. income.promoting about the same product in about the same way to all consumers. and long-term effects on audiences. right to information). and enhancing audience recall of particular advertisements(e. In addition. or program names. Call it the power of television or power of sound and image together. promotions(Dominos Pizza). intermediate-term. long-term objectives incorporate all of the aforementioned tasks. Short-term objectives include exposing audiences to different concepts. Fevicol. behaviours. Intermediate-term objectives include all of the above. Raymond’s) or public service announcements (PSAs). as well as changes in attitudes. in addition to focused restructuring of perceived social norms. Finally. Television ads have a different impact of it on the people’s mind is most remembered. or educational level. Types of mass media      Television Radio Print OOH Internet Television is a powerful medium for appealing to mass audiences—it reaches people regardless of age. and it makes dramatic and lifelike representations of people and products. Mass marketing creates the largest potential market. and perceptions of social norms.

regional. E. However radio requires somewhat greater audience involvement than television. and few contained varied 28 . Radio. Thus. Red FM. My FM. radio is sometimes considered to be more efficient. various ethnic groups. soaps. magazines are also preferred by the advertisers especially the mass is divided. Print Newspapers are available in daily and weekly formats. Other Print Media Pamphlets. and posters constitute other print media used to disseminate health messages. In addition. Geography – specific). The main benefit for the same can be that it is the best means if the target is local. Thus. Classifieds in that is the commonest form of advertisements. taste. Lots of ads targeting masses are seen more on television than any other media. 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. radio is able to convey messages in greater detail. women. radio can reinforce complementary messages portrayed in parallel fashion on TV. These print media were developed with the assistance of target audiences.g. shampoos. Radio also reaches mass and diverse audiences. brochures. and local. etc. it can target mass audience on local level.preferred choices to attract the masses. there are numerous special audience newspapers (e. Among other print media. automobiles. The specialization of radio stations by listener age. However the biggest disadvantage is that there are chances of it being overlooked. In Ahmedabad itself there are five radio stations and since placement and production costs are less for radio than for TV. Radio Mirchi.g. Radio City and many others have their stations in many other cities. Many radio stations have come up in the past 5 years and it’s still increasing.. and even gender permits more selectivity in reaching audience segments. National dailies in India have highest penetration amongst all media of advertising. water purifiers. creating the need for more mental imagery. Because of this. and national publications exist.

were culturally tailored. In addition. and skywriting. For persons who regularly pass by billboards or use public transportation. or employed readability and face validity techniques. the effectiveness of such postings wears out quickly as audiences grow tired of their sameness.g. blimps. these media may provide repeated exposure to messages. placards inside and outside of commercial transportation modes. flying billboards (e. Vodafone and Kingfisher all make extensive use of their logo-bearing blimps around sports stadiums especially any cricket match in India. however. It is possible to put virtually anything on-line and disseminate it to any location having Internet access. Commercial advertisers such as Rado. from the image problems that afflict urban buses and subways. signs in tow of airplanes).messages. re-read. Rolex. But unlike TV or radio. Internet The advent of the World Wide Web and the massive increase in Internet users offers enormous opportunities and challenges. their permanence is unknown. but the user has little control over quality and accuracy. as well as the resources to purchase hardware and Internet subscription services.. 29 . Outdoor media include billboards and signs. Pepsi. The Internet places users in firmer autonomous control of which messages are accessed and when they are accessed. Outdoor media. The most important benefit is that It can attract masses all over the world unlike TV and Radio. and keep these devices—or circulate them to other readers—is not well evaluated. The extent to which persons read. Thus. Internet search engines can direct users to tens of thousands of web sites after the user's introduction of one or more keywords. Prohealth messages displayed on urban public transportation may suffer. which are available in nearly all households. Also internet is such a medium which can be termed as a personalized media too. Internet access requires some technical skill.

However. where a product is made especially for one person or a group of persons. Or the best example can be that of personal computer. It is not appropriate for products with limited appeal like toothpaste.What can be marketed on mass basis? A mass market strategy is effective for products that appeal to a broad crosssection of consumers and used to effect attitude change to as wide an audience as possible like aspirin or orange juice. Mass marketing is the opposite of niche marketing. fizzy drinks and personal computers. Other products of mass marketing are furniture. Like furniture is now made as per the demand of the customer. an American company. Dell. 30 . A company or individual who manufactures toothpaste wishes to get more people to buy their particular brand over another. artwork. sells its computer as per the requirements of the customer. Thus everywhere there is shift from mass advertising to class advertising. Toothpaste isn't made especially for one consumer and it is sold in huge quantities. automobiles. 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. things which are perceived to be necessary/essential to the consumer are subject to mass marketing. residential communities. Typically. even in the products which were earlier thought of being marketed on the mass basis are nowadays marketed on the basis of customization.

building an operation to parallel that of an entrenched industry giant was not profitable or realistic. beginning in the 1990s. Pepsi made a series of attempts. Potential competitors wanting a share of the large market had two options. promotion. Also that that time. One was to replicate the organization. market segmentation had surpassed mass marketing as the primary approach. to crack into Coca-Cola's market share through changes in product and targeted promotion strategy in India making it a youth drink. 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. The other was to go after a part of the market that had unique needs by developing products specifically for them. By the late 90s.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. General Motors. For nearly all of the challengers. As a result. and distribution systems of the company that had created the mass market. television provided a powerful tool for both new and old companies to reach segmented markets. Mass Marketing Now and in the Future 31 . most of them gravitated to the more attractive marketsegmentation approach.

But as rightly said. Also segmentation on the basis of classes is one of the most emerging concepts. is presented as an alternative to smoking. 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. companies have started opting this class advertising approach to attract the targeted audience that’s fits into segment of probable buyers of the products or services offered by the advertisers. 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. At the same time. Products with broad appeal and few distinguishing characteristics— such as household cleaners.In spite of the shift to market segmentation. companies are more concentrating on offering customers a more personalized touch. And discount retailers. the Internet provides a new medium for mass-marketing initiatives. work and social classes. Especially with the companies becoming global and audience becoming conscious of what they want. change is the only thing that is permanent. Any current or future product that has mass-marketable attributes will likely be marketed by some form of the approach. potato chips. and newly opened international markets offer a possible arena for mass-marketing opportunities. for example. India being known for it’s extremities of people in terms of income. education. mass marketing continues to be used in many situations and has potential for others. match their mix of mass-marketed products to local customer bases. even the changes are expected in terms of the ways of marketing and targeting the customers on personalized basis. and pain relievers— lend themselves to mass marketing just as they always have. Chewing gum. such as Big-Bazaar. 32 . In addition. Utilities and credit cards offer special rates to entice potential high-volume customers.

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 Communication Distribution Branding Advertising and PR Traditional retailing and direct marketing Traditional branding and co-branding 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 customer’s name as brands 33 .

Basis of competitive Marketing power advantage Product and offerings service Line extensions modification. With rising incomes. household consumption has increased. Marketing and R&D drive new product Marketing finesse and “capturing” the customer as “partner” Customer interactions drive new product development. More than 291 million people will move from desperate poverty to a more sustainable life. the shape of the country's income pyramid will also change dramatically. Real average household disposable income has roughly doubled since late 80s. 34 . and marketing. services. While much of this new wealth and consumption will be created in urban areas. customizes products. adding a number of first-time consumers to the market. rural households will also benefit. and a new Indian middle class has emerged. As Indian incomes rise. along with the spending power of its citizens. CLASS ADVERTISING Understanding the Indian Consumer India's economic growth has accelerated significantly over the last two decades.

mass distribution. 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. there is no longer a “oneproduct-fits-all” mentality that would appeal to consumers. The first step in target marketing is to identify different market segments and their needs. and mass communication.” Even if they could. and it rarely is possible to satisfy all customers by treating them alike. Thus marketing concept calls for understanding customers and satisfying their needs better than the competition. 35 .The Need for Targeting Specific Class/ Group Two words sum up today’s consumer market: unlimited choice. Target advertising on the other hand recognizes the diversity of customers and does not try to please all of them with the same offering. media outlets have proliferated and different concepts have emerged to woo the customers from customization to interactive media advertising. If firms ignored the differing customer 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. At the same time. and the incumbent firms would lose those customers. Marketers are no longer able to reach a “mass market. 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. Over the past decade. But different customers have different needs. another firm likely would enter the market with a product that serves a specific group. companies have rushed to steal market share by creating an unending stream of new products to meet the desires of consumers.

SEC is made to understand the purchase behavior and the consumption pattern of the households. A common classification that is used by marketers to describe the Indian population is the Socio Economic Classification (SEC). But how to group people and on what basis is one of the most challenging question for the marketers. The SEC classification. 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. marketers have found the need to concentrate on a specific group than mass.Thus. Geographic Demographic Psychographic Behavioral However. Income can discriminate between consumers and non-consumers for certain products. Earlier the basis for segmentation was on four major categories. is used by most media researchers and brand managers to understand the Indian consuming class. was ratified by Market Research Society of India (MRSI). The basic reasons for developing a SEC system were the following: 1. 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. 36 . which mostly depends on the marketer to decide. but not for others. created in 1988. 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.

R2. Semi Pucca or Kaccha) Table below shows the socioeconomic classification of urban Indian households. i.e. D. B1. the cut-offs of high and low income will vary quite rapidly over time. E1. E2 (Calculated as a function of Educational qualifications of the CWE* and his occupation) The Rural Sector is divided into SEC R1. A2. Income is not stable over time whereas SEC is. B2. 3. Income is often understated. The Urban Sector is divided into SEC A1. R3.. R4 (Calculated as a function of Educational Qualifications of the CWE* and the type of the household he stays in – Pucca. C.2. OCCUPATION < 4 yrs in school E1 5-9 yrs of school D EDUCATION School certificat e C Some Post college Graduate graduate C B2 B2 Illiterate Skilled workers E2 37 .

Unskilled workers Shop owner Petty trader Employer of > 10 persons < 10 persons None Others Clerk Supervisor Professional Senior executive Junior executive E2 D E2 E2 D D E1 C D D B2 C D B2 C D A2 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 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 College/Graduate/Post Graduate Graduate/Post Graduate Graduate/Post Graduate 38 .

Professional Senior Executive A2 Post Graduate Graduate/Post Graduate Graduate/Post Graduate 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 C Skilled Workers Shop Owners Petty Traders Employer of <10 Persons School Certificate/ Some college 5-9years of school School Certificate/ Some college Illiterate 39 .

40 .none Clerk Supervisor Junior Executive Skilled Workers Unskilled workers Shop Owners Petty Traders Employer of D 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 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 ProfessionalDegree/Graduation/PG/College SSC/HSC ProfessionalDegree/Graduation/PG/College ProfessionalDegree/Graduation/PG/College SSC/HSC 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 41 .Class 9/Up to class 4 Self-Learning Class 4.

2.. All other places which satisfied the following criteria: . the outgrowths of cities and towns have also been treated as urban All areas not identified as Urban. are classified as Rural.Urban & Rural Classification According to the Census of India 1991.e. All statutory towns. i. etc.At least 75% of the male working population engaged in nonagricultural pursuits. 42 . the following criteria were adopted for treating a place as urban: 1. all places with a municipality. and . corporation.A density of population of at least 400 per sq km 3. cantonment board or notified town area committee. Apart from these.A minimum population of 5000 .

and would have surely bought if he belonged to higher class. Also almost everyone now spends not looking at their income but the status and to cope up with that. marketers have always targeted customers on the basis of their income and predicted their requirements on the same basis. Other examples could be expensive furniture. Gujarati. an executive who is not so rich by income may have the needs for high-end products like luxurious car. The need arises from his status as an executive though he may not afford it. suiting and other lifestyle products and services which solely concentrated on the Elite class. 43 . 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. Mobiles are the best examples. consumers today do not hesitate to spend their income lavishly leaving only a mere amount to savings. which nearly costs same. etc. create employment and improve lives has trickled down to the lowest socio-economic class. But a person who is not educated and whose requirement of profession does not allow him to buy an English newspaper.SEC: A debate Over the years. awareness around the power of information technology to solve problems. Also. However. naturally he would not go for an English one. far-away traveling. branded clothes. Thus. For example. The gadget which was earlier a status symbol is now a requirement and is being used by everyone around the corner. Other argument is that. 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. Hindi or English. Even a lower income person can afford the subscription of newspaper. demand for certain products like newspaper arises not out of income.

the cut-offs of high and low income will vary quite rapidly over time. annual incomes of 1 million-plus rupees are earned by thousands of families today. 3.Created in 1988. Income is not stable over time whereas SEC is. Salary levels in India have undergone a huge change in the 1990s. Now let us examine the first reason stated in the context of a few product categories. 2. 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 44 . covering all urban and rural areas. Income can discriminate between consumers and non-consumers for certain products. since lifestyle reflects the consumption patterns more closely than the income levels. The method used is that of a selectivity index. Over 80 percent of upper income respondents were found to have regular monthly expenses well in excess of their stated monthly household income (MHI). This classification is pertinent as compared to an income-level based classification. The second of the three reasons is also beyond dispute.e. 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. the SEC divided Indian households on the basis of the chief wage earner’s education and occupation. SEC A1 to R4. but were the privilege of the very rich a decade ago. but not for others. The basic reasons for developing a SEC system were the following: 1. Income is often understated.. and this proportion was not much lower among lower income respondents too. i. The last has been proved by large-scale studies that compared household expenses with claimed income.

As a brand ambassador. Tendulkar. Today. He owns a Ferrari. Also there are many big names have completely junked the SEC segmentation. there are many questions that have been raised on it. ‘Swift’ competes outside its so-called category with bigger cars such as Esteem and Ikon. would fall into what most Indian marketers recognize as socio economic classification (SEC) B — a category that is distinctly middle-class. and life stages to make a compelling basis for defining consumer segments. But many brands that he has endorsed in his 18-year career were never meant to be used by him. Consumers are now breaking class barriers. Several layers of consumer segmentation need to be added on like psychographics. cultural clusters. 45 . Not only common man but celebrities are under a questionable situation too. The uni-dimensional way of looking at demographics is a key limitation of SECs. The size-price equation doesn’t hold good here. The consumer is willing to pay more for a smaller but better designed product. The twodecade-old demographic classification SEC is past its sell by date —is indeed a question on everyone’s mind and certainly on marketers’. The company has gone with its own market definition for all of their retail formats. Take Sachin Tendulkar for an example. The first name is The Future Group. and his million-dollar endorsement deals are a matter of widespread national interest. he is a marketer’s delight who has helped reviving the flagging fortunes of several brands. However. who hasn’t completed his graduate studies. People are using brands to express themselves more than ever before. in spite of there being many arguments in favour of SEC. and prospered nonetheless.measured by very large-scale studies — specifically the Indian Readership Survey.

Yet. in 2002. which was formed with a threshold of Rs 10. India Two or the serving class and India Three or the deprived class. They’re using the (SEC) classification data. as affluence rose in SEC A1 to an A1+. They use it along with additional data like ownership and consumption but there is no alternative to demographic data. However. there are still many big marketers who think along those lines. education. it’s been a decade since any serious changes were made to classify consumers. A1 and A2. servants. In fact.“We have been maintaining that the SEC classification is not a true representation of Indian consumers for three-four years now. a temporary solution was formed by splitting SEC A into two categories. it considers the occupation and education of 46 . Later. This led to a further division. That is the core target audience that he is trying to capture. even though many big companies going against SEC. which segments consumers into 18 LSM clusters on the basis of 25 parameters such as income. Also on Biyani’s radar is a part of India Two. Unilever devised its proprietary Living Standard Measurement (LSM) index as an alternative to SEC. this has become dated. watchmen and small grocers. Biyani’s philosophy is simple. 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. for instance. durables ownership. But what is considered as the biggest drawback of this SEC is that. India One consists of the ‘consuming class’ that makes up 16-18% of the consumers but account for 95% of the buyers. media consumption. Owing to this.” says Future Chairman Kishore Biyani. the group that serves India One. entertainment preferences et al. with nearly a decade since the idea of SEC A1+ was mooted.000 as monthly income. because it’s the only data that they have.

data from large-scale studies show that further refinement is now called for. 47 . The appropriate questions are now being put on to large-scale surveys. One of the key evolutions was the development of a socioeconomic system of classifying consumers around a decade ago.CWE Chief Wage Earner which may not be always influential as far as purchase decisions are considered. One possible solution is to introduce further levels in the SEC system. market research in India has been evolving rapidly to tackle the increasing needs of marketers operating in a complex environment. While SEC is an improvement on income. This is being done by combining SEC with household expenses to see if a combined system yields better results. Further refinement No matter what debate it takes.

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 Total Value 21228 37351 46195 % 3 5 6 Male Value 11681 20237 24718 % 3 6 6 Female Value 9547 17114 21477 % 3 4 6 48 .

Female A1 = 3.516 (3%). Male E2 = 20. (All in ‘000) 4 A-E.386(1%). total rural URBAN 49 .729 (5%). total urban 5 R1-R4. Female B1 = 8. living in not very good houses R3 = some education.510 (3%).D E3 R1 R2 R3 R4 Group 14 (A-E) Group 25 (R1-R4) Source: IRS(2005) 61573 64305 19671 56491 199061 243749 220652 578972 7 8 3 8 27 33 30 70 27589 33063 10180 29268 104834 122424 117288 266766 7 8 3 8 27 32 31 69 23984 31242 9491 27223 94167 121325 103364 252206 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. Total B1 = 18.404 (1%). Male A2 = 7. Female A2 = 6.553 (5%). Female E1 = 11.824 (2%). Total E1 = 24.018 (1%). Total A1 = 7. (All in ‘000) 2 Consists of the two Groups B1 and B2: Male B1 = 9. living in temporary shelters 1 Consists of the two Groups A1 and A2: Male A1 = 4. Female B2 = 8.452 (2%). living in good houses R2 = good education. Female E2 = 19.440 (2%).663 (2%).662 (2%).026 (3%). Total E2 = 40.249 (3%). (All in ‘000) 3 Consists of the two Groups E1 and E2: Male E1 = 12.726 (6%).161 (2%).988 (3%).911 (3%). Total B2 = 18. Male B2 = 10. Total A2 = 13. living in huts and temporary shelters R4 = uneducated.

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 of urban population Sec C refers to Middle-class-- constitutes nearly 20% of the urban population Sections D & E refer to Low-class-- constitutes over half the urban population.

RURAL
Rural population forms 70% of the total population and SEC Rural has four levels on the basis of occupation and type of house 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 50
___

Pucca, Semi-Pucca and

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

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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,

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53 . 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”. though they both are categorized as high income group. Thus even in high income group. at the bottom of the pyramid! However the conclusion given here is on the overall basis. which is the purpose of any targeting by any marketer. 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. Thus. Perhaps there is fortune. where the categorization may differ for different products. there always exists a debate if this bifurcation really shows the true picture. the income variation and status differs which marketers don’t notice before selecting media for advertising their product. with nothing as an exception to the drawbacks is acceptable too to most of the marketers. 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. However. as the respondents are hesitant to disclose the correct MHI. after all.but account for an income share of 30%. The drawback of using Monthly Household Income (MHI) lies in the difficulty of capturing the correct data. To understand.

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 consumer’s 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

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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-à-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 consumer’s 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.

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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. Print has the highest penetration in Kerala and the lowest in Orissa. Reach figures for both states are 71 per cent and 27 per cent, respectively. 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, Madhya Pradesh and Chhattisgarh, with just 2 per cent reach in each state.

Rural reach

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Radio reaches 22 per cent males and 13 per cent females. and least effective in Madhya Pradesh. Print reaches 20 per cent males and 7 per cent females.The penetration of all these media is relatively different in rural India. Uttar Pradesh and West Bengal – 1 per cent penetration in each of these states. 57 . but penetrates only 38 per cent of the huge rural population in the country. Cinema reaches 4 per cent males and 1 per cent females. with 83 per cent penetration. Looking at the reach of the various media on the basis of sexual division. like in urban India. it is the lowest in Bihar. Gujarat. State wise reach is highest for television in Goa. Haryana. has the maximum reach in Tamil Nadu (40 per cent) and the minimum reach in Andhra Pradesh (3 per cent). Cinema follows the same trend in rural India as in urban India and has the highest reach in Andhra Pradesh – 20 per cent. with only 4 per cent reach. The medium has the lowest reach in the states of Bihar. Radio overtakes print in rural India and becomes the medium with the second highest reach. Orissa. Print is most effective as a medium in Kerala again. like in urban India. Radio. Radio reaches to the 18% of the rural population. The penetration of print is 15 per cent. Television continues to be the medium with the highest reach. TV’s penetration in rural areas is 39 per cent for men and 35 per cent for women. with 11 per cent penetration. with 62 per cent reach. Chhattisgarh. Cinema. has the lowest reach in rural India – it reaches a mere 5 per cent of the rural population.

58 .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.

people had not many options as far as media is concerned. before the selection of any media to advertise. and that comprehensively reaches the highest percentage of your target audience for the lowest cost.Thus. But with the advent of new media and global competition. So how can marketer decide whom to target? First. And if the results show positive response the next question arises is what advertising media should you use to promote your business? Simple. Secondly. 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? 59 . Media Preference Until last century. to what extent the consumer is ready to accept. other than basic items like salt. one of the most important things to be taken into consideration is that what consumers prefer as far as media selection is concerned. Use the one that is most influential and believable. However. However. understanding the product itself is an important thing. the wants are converted to demand for the product/service. seldom he markets the one which is for all the classes. When a marketer markets a product. the main consideration is affordability of the consumer because only then. 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. Thus. not many are left behind in attracting people.

That is instead of individual choices. For knowing the selection patterns existing among the people. following is the research conducted to know the class preference (restricted to Ahmedabad. It is an everlasting ongoing process of sticking to one media at some point and switching to other at the other point. no one can say anything for sure what a consumer prefers. Urban) RESEARCH STUDY 60 . it can be said that the overall preference for the people belonging to the same class remains same. Preference for media is thus cannot so be so easily predicted.The answer is. class preference show an inclination towards certain media that might help an advertiser to choose the media for advertising in a better manner. But when we talk about class advertising.

Research Problem: To know the exposure level of different media to different socio-economic classes Research Design: Exploratory research design Sample Design: Stratified random. convenience sampling Research Instrument: Questionnaire (Annexure) Sample Size: 30 for each class (8 classes) = 240 Duration: 1 month 61 . Judgment sampling.

RESEARCH FINDINGS The findings below are bifurcated according to the different classes from A1 to E2. A1: THE AFFLUENTS A2: THE RICH B1: THE DREAMERS B2: THE AMBITIOUS C: THE CLIMBERS D: THE STRUGGLERS E1: THE LAGGARDS E2: THE FORTUNE SEEKERS 62 .

TV EXPOSURE The results show that the classes B1. The detaled exposure to various channels is given below. and D have the highest Tv exposure amongst all classes. 63 .B2. C.

A2.A2. The remaining classes have almost the same exposure to news channels. 64 . For targeting the A1. and B1 have the highest expoure to news channels. and B1 classes advetisment on news channels would prove more effective as their exposure is high.NEWS EXPOSURE As the results show the classes A1.

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. 65 . For targeting all the classes advetisment on music channels would prove more effective as their exposure is high.

E1 and E2 have very low exposure. 66 . The remaining classes have almost the same exposure to informative channels. and B1 classes advetisment on informative channels would prove more effective as their exposure is high. Also the classes C.A2.D.INFORMATIVE CHANNEL EXPOSURE As the results show the classes A1. and B1 have the highest expoure to informative channels. For targeting the A1.A2.

MOVIE CHANNEL EXPOSURE As the results show the classes A1 and E1 have the highest expoure to movie channels. For targeting the A1 and E1 classes advetisment on movie channels would prove more effective as their exposure is high. The exposure for the remaining classes varies greatly. 67 .

For targeting the all the classes advetisment on news channels would prove more effective as their exposure to sops is high. 68 .SOPS EXPOSURE As the results show all the classes have very high expoure.

D.D. EXPOSURE 69 .

C. The exposure for the remaining classes is not applicable. NEWSPAPER EXPOSURE 70 .D.D.C.D.As the results show the classes B2. For targeting the B2.E1 and E2 have the highest expoure to D. channel.E1 and E2 classes advetisment on sop would prove more effective as their exposure is high.

A2.A2. The remaining classes have almost the same exposure to news papers.B1 and B2 classes advetisment on news papers would prove more effective as their exposure is high. For targeting the A1 and A2 classes advetisment on english news papers would prove more effective as their exposure is high. The exposure for the remaining classes is not applicable.B1 and B2 have the highest expoure to news papers. ENGLISH As the results show the classes A1and A2 have the highest expoure to english news papers. 71 .As the results show the classes A1. For targeting the A1.

LOCAL LANGUAGE 72 .

ENGLISH + LOCAL LANGUAGE 73 . For targeting the all the classes advetisment on local language news papers would prove more effective as their exposure is high.As the results show all the classes have very high expoure.

D. CINEMA EXPOSURE 74 .As the results show the classes A1. 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.E1 and E2 is not applicable. The exposure for the remaining classes C.A2 and B1 have the highest expoure to both english and local language news papers.

MAGAZINE EXPOSURE 75 .B1.A2.B1.A2. For targeting the A1. The remaining classes have almost the same exposure and that is very less.As the results show the classes A1.B2 and C classes advetisment on cinema would prove more effective as their exposure is high.B2 and C have the highest exposure to cinema.

A2.E1 and E2 is not applicable.As the results show the classes A1.A2.B1and B2 have the highest expoure to magazines . For targeting the A1. INTERNET EXPOSURE 76 . The exposure for the remaining classes C.B1and B2 classes advetisment in magazines would prove more effective as their exposure is high.D.

D.E1 and E2 is not applicable. The exposure for the remaining classes C. For targeting the A1and A2 classes advetisment in magazines would prove more effective as their exposure is high. 77 .As the results show the classes A1and A2 have the highest expoure to internet.

For targeting the rest of the classes advetisment on OOH would prove more effective as their exposure is high. 78 .OOH As the results show all the classes except B1 and B2 have very high expoure.

For targeting 79 .D.E1 and E2 is very high.B2.C. The exposure for the remaining classes B1.RADIO EXPOSURE As the results show the classes A1and A2 have the lowest expoure to radio.

E1 and E2 classes advetisment in radio would prove more effective as their exposure is high.B2. Thus targeting the right audience for the advertizing and choosing a specific media can help advertisers save a lot money in advertizing.the B1. It gave some of the true picture of the industry with which I was totally unaware of.D. has a huge potential for further development. 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. CONCLUSION The Indian Advertising Industry being one of the fastest growing area of not only the IE&M but also the Indian Economy.C. The experience of knowing the insights of the Indian Entertainment and Median Industry as well as the Indian Advertising Industry was enriching. 80 .

Not necessarily does the company have to cut back on its advertising expenses. Also. Research can also be undertaken to understand the exposure level of various classes in the rural area to various media. 81 . advertising agencies or market research firms can help understand the exact exposure relations of the various socio economic classes to the various media.RECOMMENDATIONS Extensive research by companies. Concrete findings can help companies in reducing advertising expenditure by concentrating on the right media to reach to target audience. the companies media budget can be used wisely.

BIBILIOGRAPY Kotler. Rama: We Are Like That Only. Philip: Marketing Management. PHI Kothari C. R. Understanding the Logic of Consumer India. Penguin Portfolio 82 .: Research Methodology Bijapurkar. Eleventh Edition.

aaai.pewsocialtrends.org/pubs/?chartid=517 83 .com/mam/headlines/y2k2/apr/apr2.ramabijapurkar.iamai.WEBOGRAPHY http://www.html http://www.indiantelevision.com http://www.impactonnet.exchange4media.com/e4m/media_matter/matter_130705.mckinsey. php http://www.asp http://www.com/manarch/news/man41321.magindia.swf http://www.asp http://www.htm http://www.quirks.com/V4_issue2.com http://www.com http://www.com/demanddrivers/dsds_indianconsumers2.egyankosh.com/mgi/publications/india_consumer_market/imag es/India_Interactive1.com http://www.

india-seminar. pdf http://www.com http://www.html http://www.org/studies/reports/presentation/PDHCM99A/sld 008.htm http://www.htm#Socio-Economic %20Classification http://www.agencyfaqs.atulvaid.martrural.timm.indiatimes.blogspot.com/Rural%20Opportunities%20& %20Challenges_website.ficci.exchange4media.com http://www.com http://www.htm http://www.edu/uasomume/cdm/media.uab.com/examples/timm/ecoclass.slideshare.pdf http://www.htm http://www.com/economy/market.com/set/317730/ http://www.http://readbetweentheps.scribd.ciadvertising.thehindubusinessline.com/2005/09/socio-economicclassification-are-we.quizlet.jsp http://www.net http://www.com/files/Atul_Vaid__Overview_of_Regulatory_Framework.com 84 .streamlineindia.com/2001/498/498%20rajiv%20inamdar%20& %20monika%20chandra.com/media-room/speechespresentations/2006/nov/us/RetailFranchisingLogisticsSession/BSNagesh.pdf http://www.

Thus advertising forms the basis of marketing.google.dogpile.com http://www. It helps to create demand. or otherwise associates a product with someone other than the principal producer.indiatoday. promote marketing system and boost economic growth.com GLOSSARY Advertising is one of the aspects of mass communication.com http://www. Co-branding is an arrangement that associates a single product or service with more than one brand name. usually revenue. CAGR (Compounded Annual Growth Rate) is used to describe the growth over a period of time of some element of the business. Advertising is actually brand-building through effective communication and is essentially a service industry. 85 .http://www. Branding is a traditional advertising method used to create a response from a target audience based on cumulative impressions and positive reinforcement.

or organization are relevant to that person and consistent over time. HPI Household Potential Index uses consumption / ownership of a whole host of durables. Interactive television represents a continuum from low interactivity to moderate interactivity and high interactivity in which. 86 .Community radio is a type of radio service that caters to the interests of a certain area. service. The most obvious example of this would be any kind of real-time voting on the screen. Exploratory research is a type of research that helps determine the best research design. It often concludes that a perceived problem does not actually exist. Integrated Marketing Communications (IMC). for example. Internet marketing is the marketing of products or services over the Internet. Once a movie is downloaded for example. an audience member affects the program being watched. controls may all be local. once the viewer enters the channel. in which audience votes create decisions that are reflected in how the show continues. Direct Broadcast Satellite (DBS) is a term used to refer to satellite television broadcasts intended for home reception. The link was needed to download the program. packaged goods. is a planning process designed to assure that all brand contacts received by a customer or prospect for a product. broadcasting material that is popular to a local audience but is overlooked by more powerful broadcast groups. services and demographics. to construct a simple aggregate index of how much purchasing power a household exhibits. A return path to the program provider is not necessary to have an interactive program experience. but texts and software which can be executed locally at the set-top box or IRD (Integrated Receiver Decoder) may occur automatically. data collection method and selection of subjects.

attitudes. Personalization is tailoring a consumer product. Market segment is a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs. is meant to describe marketing in a moving fashion. 87 . IPTV (Internet Protocol Television) is a system where a digital television service is delivered using Internet Protocol over a network infrastructure. and a more traditional definition. electronic or written medium to a user based on personal details or characteristics they provide. values. Visual radio is a generic term for adding visuals to normal audio radio broadcast. Second. Psychographic variables are any attributes relating to personality. Out-of-home advertising (OOH) is essentially any type of advertising that reaches the consumer while he or she is outside the home. which covers a much wider geographical range than terrestrial radio signals.Interactive advertising is the use of interactive media to promote and influence the buying decisions of the consumer in an online and offline environment. Mass communication is the term used to describe the academic study of the various means by which individuals and entities relay information through mass media to large segments of the population at the same time. First is meant to describe marketing on or with a mobile device. Satellite radio (SR) is a digital radio signal that is broadcast by a communications satellite. Mobile Marketing can refer to one of two categories of marketing. which may include delivery by a broadband connection. or lifestyles. interests.

: 1) Please tick (√) the boxes for your response and leave the others blank. Third-party logistics provider (3PL) is a firm that provides outsourced or "third party" logistics services to companies for part. B2. ANNEXURE Questionnaire QUESTIONNAIRE ON MEDIA PREFERENCE (SEC) N.B. or sometimes all of their supply chain management functions. D. Stratified sampling is a method of sampling from a population. B1. (Please select only one option under each question) 88 .Socio Economic Classification: Socio-economic classification (SEC) indicates the affluence level of a household to which an individual belongs. 3) The information collected in the survey will be kept confidential and used only for the research purpose. and E2. SEC is divided into 8 categories A1. Socio economic classification of an urban household is defined by the education and occupation of the chief wage earner (CWE) of a household. C. (In decreasing order of affluence) Social Network Advertising is a term that is used to describe a form of Online advertising that focuses on social networking sites. Stratification is the process of grouping members of the population into relatively homogeneous subgroups before sampling. A2. 2) Please rank in the order of preference wherever mentioned. E1. One of the major benefits of advertising on a social networking is that advertisers can take advantage of the users’ demographic information and target their ads appropriately.

1. How much TV do you watch per day? ( ) ( ) 0-15mins 45-60mins ( ) 15-30mins ( ) 1-2hrs ( ) 30-45mins ( ) 2-3hrs ( ) 3-5hrs 5. How much time do you spend on watching Music channels per day? 89 . Occupation: ( ) Skilled workers ( ) Petty trader ( ) Professional ( ) Unskilled workers ( ) Clerk ( ) Senior executive ( ) Shop owner ( ) Supervisor ( ) Junior executive ( ) Employer of < 10 ( ) Employer of > 10 persons persons ( ) Employer of None 2. How much radio do you listen to? ( ) ( ) 0-15mins 45-60mins ( ) 15-30mins ( ) 1-2hrs ( ) 30-45mins ( ) 2-3hrs ( ) 3-5hrs 4. Education: ( ) ( ) ( ) Illiterate School certificate Post graduate ( ) < 4 yrs in school ( ) Some college ( ) 5-9 yrs of school ( ) Graduate 3. 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.

(All doordarshan channels) per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs ( ) 2-3hrs ( ) 3-5hrs 10. Which type of newspapers do you read? ( ) General ( ) Business ( ) Both 13. How much time do you spend on watching D.( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs ( ) 2-3hrs ( ) 3-5hrs 7. 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 reading newspapers per day? ( ) 0-15mins ( ) 15-30mins ( ) 30-45mins ( ) 45-60mins ( ) 1-2hrs 11.D. How many magazines do you read per day? ( )0 ( )1 ( )2 ( )3 ( )4 ( )5 15. In which language do you read newspapers? ( ) English ( ) Local language ( ) Both 12. How much time do you spend on internet per week? ( ) 0-1hours 25hours ( ) 1-5hours ( ) 5-10hours ( ) 10-20hours ( ) 20- 90 . How many movies do you watch in a month (in theatres)? ( )0 ( )1 ( )2 ( )3 ( )4 ( ) 5-10permonth 14. How much time do you spend on watching Sops channels per day? ( ) ( ) 0-15mins 45-60mins ( ) 15-30mins ( ) 1-2hrs ( ) 30-45mins ( ) 2-3hrs ( ) 3-5hrs 9. How much time do you spend on watching Informative channels (ex: discovery.

91 .16. Thank you for your valuable time. Noida.B. How much do you travel per day? ( ) 0-5kms 50kms ( ) 5-10kms ( ) 10-15kms ( ) 15-20kms ( ) 20- This questionnaire is part of Grand Project on “Class Advertising” as a part of M.A studies at Amity Global Business School.