( Pic Courtesy: Book Cover of ‘Marketing to Win’ by Satish Mehta, Pearson)
“Market share = share of conversations”; thus read one of the advertisements in The Economic Times celebrating 30 years of Brand Equity, a pullout that comes every Wednesday along with The Economic Times (ET, hereafter), Asia’s largest business newspaper. After all, aren’t markets about people and people about conversations? From a brand management perspective, a successful brand is all about being at the core of the conversations of its target segments that resonates with the brand values. The sharper the conversations around the brand, the stronger is its brand equity. Therefore, this year when ET celebrates its sub-brand ‘Brand Equity’, it is worthwhile to revisit and reflect on the creation of one of the most iconic print media brands that served the overall business objectives of its creator; Bennett Coleman and Company Limited.
Looking back, one gets transported to the late 80s when business news meant the ET and a few magazines like Business India and Business World. That was pre-internet era wherein content meant print and print only. As business students, we would scan through the pages of ET and these magazines to get some insight into the marketing news. That was difficult till ET introduced a four-page pullout on glazed newsprint called Brand Equity. Those four pages carried stories on brand launches, creative communication, advertising agencies, and consumer marketing. In 1989, ET used to cost Rs.4, however, on Wednesday (which carried Brand Equity) it was priced at Rs2/-. Students found that much affordable and it was a common sight to see a copy of ET in hostel rooms, every Wednesday. My association with ET went beyond being a reader. I started working for the Times Group in Results and Market Development department which was responsible for increasing the readership of all newspaper and magazine brands owned by the group. My marketing education beyond the textbooks began soon after when I would get the opportunity to listen to some of the finest marketing minds of our times. Two fascinating strategies that the company implemented very successfully was about the Brand Equity and invitation pricing; both related to each other.
ET and the advertising world
In the late ’80s, advertising budgets had a strong skew towards general-interest English newspapers such as The Times of India, Hindustan Times, The Hindu and the business newspapers as a segment was in an initial phase of introduction. The reasons could be easily understood in quantitative terms; the reach and readership of general-interest English dailies were manifold higher than that of a business newspaper. However, there was one more reason that kept ET out of most media plans. Young media buyers and account managers were busy delivering a larger audience to their client’s brands and it was a win-win for the agency and the clients. The quality of the readership in terms of the demographic profile was very strong for ET but the brand was not in the consideration set. ET needed to build a strong connection with these young media planners and make them excited about the quality of the audience. Brand Equity was conceived as a weekly pull-out which was to carry articles written by advertising and agency professionals. When it was launched, it’s four pages became a playground for these professionals who would share their content mostly focusing on advertising and marketing. While at one hand it achieved the objective to connect with people who ran the advertising business, on the other hand, readers loved the content and would wait for ET on Wednesday (with Brand Equity). This was the starting point of another strategy that would change the print media business for many decades to come.
Readers, you got an invitation!
An interesting part of the media folklore goes like this: Samir Jain, Vice Charman, known as VC in the Times Group, was once on way to his office from his Alipore residence in Kolkata. He noticed a long queue in front of the Alipore Zoo. This was his regular route to the office but he never noticed such a big crowd waiting to go in. The driver sensed his curiosity and informed him that the entry was free every Monday. Considering the small entry fee that zoo charged those days, free entry did not justify the swell in the number of visitors to the zoo. However, this intrigued him and the idea of ‘zero-price high attraction scenario’ stuck on. With the launch of Brand Equity, it was time to experiment with the idea. Many executives looked at this idea as superfluous – can reducing Rs.2/- on a cover price of Rs.4/- get more readers for a premium product like ET? Unlikely, many predicted. However, this idea was to be pursued and the legendary marketing genius Satish Mehta who was the Director Marketing (fondly called MKD) thoughtfully gave this strategy a name: Invitation Price. Based on the Pavlovian theory of conditioned learning, he expected that the stimulus of low pricing would elicit more purchases on the days of lower prices. And it worked, and how! Sales of ET on Wednesday swelled up (almost doubled) and there were a large number of new readers (that included me and my batch mates) getting hooked to the paper and thus reading it on other days as well. The zoo intrigue fructified and it set the stage for a pricing revolution in the print media business. It’s ironic that despite the price elasticity on display, many industry stalwarts did not take a note of it till 1994. That was the year when invitation price was launched for The Times of India(TOI) in the Delhi market. The competitor could not sense its long term impact and that started TOI’s journey towards leadership in the Delhi market which it attained in 2003, after a long battle of nine years. By that time invitation pricing was the norm in the print media business.
Almost all newspapers would have used this pricing strategy to attract new readers. Times group almost perfected the art and science of invitation pricing that helped it enter new markets with new products such as Ei Samay, a Bengali daily launched in Kolkata in 2012. Vinay Singh, then EA to MKD, who was my boss for several years once told me, “when we were going ahead with the new pricing and MKD gave this a name- Invitation Pricing, VC was very pleased. He said only MKD could have thought of such a name for this pricing strategy.”