Thursday, 9 March 2017

Concept of Management and its Principles

What is management?

What is media Management

Management in all business and organizational activities is the act of coordinating the efforts of people to accomplish desired goals and objectives using available resources efficiently and effectively. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources.
Since organizations can be viewed as systems, management can also be defined as human action, including design, to facilitate the production of useful outcomes from a system. This view opens the opportunity to 'manage' oneself, a prerequisite to attempting to manage others.
The word manage comes from the Italian maneggiare (to handle, especially tools), which derives from the Latin word manus (hand) which influenced the development in meaning of the English word management in the 17th and 18th centuries.

What are the principles of Management?

What are the principles of Management

Management principles are statements of fundamental truth. These principles serve as guidelines for decisions and actions of managers. They are derived through observation and analysis of events which managers have to face in practice.
The Principles of Management are the essential, underlying factors that form the foundations of successful management. According to Henri Fayol in his book General and Industrial Management , there are fourteen 'principles of management'. These can be used to initiate and aid the processes of change, organization, decision making, skill management and the overall view of the management function.

Management Principles developed by Henri Fayol:

  1. DIVISION OF WORK: Work should be divided among individuals and groups to ensure that effort and attention are focused on special portions of the task. Fayol presented work specialization as the best way to use the human resources of the organization.
  2. AUTHORITY: The concepts of Authority and responsibility are closely related. Authority was defined by Fayol as the right to give orders and the power to exact obedience. Responsibility involves being accountable, and is therefore naturally associated with authority. Whoever assumes authority also assumes responsibility.   
  3. DISCIPLINE: A successful organization requires the common effort of workers. Penalties should be applied judiciously to encourage this common effort.       
  4. UNITY OF COMMAND: Workers should receive orders from only one manager.              
  5. UNITY OF DIRECTION: The entire organization should be moving towards a common objective in a common direction.             
  6. SUBORDINATION OF INDIVIDUAL INTERESTS TO THE GENERAL INTERESTS: The interests of one person should not take priority over the interests of the organization as a whole.        
  7. REMUNERATION: Many variables, such as cost of living, supply of qualified personnel, general business conditions, and success of the business, should be considered in determining a worker’s rate of pay.         
  8. CENTRALIZATION: Fayol defined centralization as lowering the importance of the subordinate role. Decentralization is increasing the importance. The degree to which centralization or decentralization should be adopted depends on the specific organization in which the manager is working.                                                      
  9. SCALAR CHAIN: Managers in hierarchies are part of a chain like authority scale. Each manager, from the first line supervisor to the president, possesses certain amounts of authority. The President possesses the most authority; the first line supervisor the least. Lower level managers should always keep upper level managers informed of their work activities. The existence of a scalar chain and adherence to it are necessary if the organization is to be successful.     
  10. ORDER: For the sake of efficiency and coordination, all materials and people related to a specific kind of work should be treated as equally as possible.        
  11. EQUITY: All employees should be treated as equally as possible.                 
  12. STABILITY OF TENURE OF PERSONNEL: Retaining productive employees should always be a high priority of management. Recruitment and Selection Costs, as well as increased product-reject rates are usually associated with hiring new workers.
  13. INITIATIVE: Management should take steps to encourage worker initiative, which is defined as new or additional work activity undertaken through self-direction.               
  14. ESPIRIT DE CORPS: Management should encourage harmony and general good feelings among employees.

 What is Media Management?And its importance.

Media management is a general job title that describes people who manage talent for media professionals like those who work in photo, sound, and video. It is a form of entertainment management, a field that manages talent in show business. Professionals in the media management field work with many types of media-related talent, including actors, artists, writers, and musicians. Media management in business differs from media management in computers because the computer term refers to activities that involve processing computer media files like music, video, and picture files.
Managers of this type are common in entertainment and print media because they facilitate contact between those seeking talent and those providing media talent. The media management field can include many types of management, including managing the finances of a popular band or controlling the royalties in the estate of a deceased movie star. A media manager might also work as an agent for a writer of books or magazines, contacting publishers who might want to buy clients' writing work.A large part of the job of a media management professional is to promote and control the media image of managed talent. To do so you require the best insider marketing in order to communicate your message to obtain supporters, advocates and allies in the institution and the entire community. By means of the right press exposure, you can even seek the services of people to help you in boosting the image of your company and in improving your organization’s image in the unique internet.
However, if you will work with several funding organizations, you will know that you can actually obtain the result that you have always wanted. True enough, it is not that easy for any one to build a company name especially in these modern times when several organizations are currently improving their own reputation so as to convince the group that they have the most popular and top quality offers.
True enough, the best press exposure can also help in the growth of any company and getting it connected to the right establishments as well as economical aid from various departments. The fact remains that press release is not simple advertising or marketing; you also have to include exposing the company to various special events, community relations, social networking, blogging, internal relations, and other important works that are geared towards achieving the best media exposure.
Media management and economics as a subfield of the mass communication field is, by any measure, young. Moreover, as a specialized area within a much larger discipline, media management is the focus of only a small group of scholars when compared to mass communication as a whole or to organizational studies.

Nevertheless, it has made remarkable progress in the development of theory in several areas. The strategic management of media companies has drawn the most consistent attention from scholars, resulting in the development of a strong body of research on the structures of media markets and the strategic management of the resources that media companies control.

The media industry influenced by the political scenario of a country

Political economy was the original term used for studying economic phenomena like production, buying, and selling of products and services, and their relations with law, custom, and government, as well as with the distribution of national income and wealth. Political economy originated in moral philosophy. It was developed in the 18th century as the study of the economies of states, or polities, hence the term political economy. 

Theory of Karl Marx

Today, theories of political economy focus on the politics and economics of media institutions and the texts they produce. Some traditions of political economy also consider how capitalist politics and economics exert themselves on media audiences. While viewing the relationship between media and political economy, it is important to see the latter’s association with classical Marxist theory and Marx’s statement (back in 1859) that social consciousness is determined not by the collective will of individuals but by the ruling classes who own the means of capitalist production. Thus, the form and content of our media and the socio-political consciousness which nurtures the media, is affected less by the opinions of the majority and more by the political motives of the few who control our media.

The media and the legislature (or the political system) are known to be two important pillars of the democracy. Neither of the two works in isolation with the other pillars. They are dependent on each other and make sure that the check and balance of power is maintained in the civil society. In such a scenario, keeping Marx’s above-mentioned idea in mind, we can fairly conclude that the way our media works and the content it produces is greatly influenced by the political system of the country and ‘not-so-greatly’ by consumers of the media content. The equation is fairly simple – The political set-up defines the corporate and ethical rules of the game that the media industry is obligated to follow. If the political system gives leverage, the media industry can circumvent these rules. Of course, in such a case the media is also compelled to further particular political causes at the cost of some others. We see this happening often around us. Certain sectors of the media are often seen getting away scot-free from major journalistic wrong-doings because the state refuses to act against such organizations. And, as a part of the symbiotic relationship we come across instances of paid, planted and manipulated news.

Another very important aspect of the political system which influences media industry is the structure of this system. The media industry is greatly impacted by a country’s form of governance (democratic, autocratic, monarchy, communist, etc.); it’s political stand on world issues and relations with rest of the World and laws, rights, regulations and duties. One of the best examples to study how political structure affects media is the example of Chinese media. The Communist regime in China is infamous for overt control on media like newspapers and TV. Media like the CCTV (China Central Television Station), the People’s Daily, the Guang Ming Daily, etc. are the main channels of the Communist Party and the government. As a result, they have been reduced to being the tools of the government and the governing party to arouse public awareness. Journalistic rights like criticizing the government and highlighting opposing points of view and voices of dissent have been snatched away from the Chinese government. This strict control over the media somewhere has its roots in the Chinese Communist school of thought which sees media as an entity that needs to be controlled in order to avoid the rise of Bourgeoisie. Subsequently, Chinese government carefully chalks out what the media can/should and cannot/should not print or broadcast. 

The strong link between media industry and the state can be understood by seeing the debates that have surrounded media because of the Andhra Pradesh-Telangana split. One of the growth industries triggered by the impending reality of a separate Telangana state, is media owned by people from the Telangana region. Suddenly it is no longer enough that Andhra Pradesh has far more news channels than any other state in the country, some 15, not counting impending and new entrants. What matters is whether the owner belongs to Andhra, or Rayalseema or Telangana. And, whose aspirations the media outlet is striving to represent. 
Andhra Pradesh’s media landscape has become a checkerboard of political affiliations. With the impending division of the state any discussion on media’s role has journalists here taking one through a newspaper and channel listing of who supports which regional formation. Match that with each channel or newspaper’s caste and political affiliation and one has a clear picture of the political economy of media here. 
So, the question that arises is: Do these political affiliations of media make the editorial line follow ownership? Potturi Venkateshwar Rao, a former chairman of the Andhra Press Academy and editor in his time of many publications, says that happens because managements now drive the editorial line. They are divided in their regional affiliations and news coverage is influenced by them. 
To quote Allam Narayana, the editor of the ‘passion-driven’ Namaste Telangana, “Managements have been aggressive in deciding media’s policy. There are no editors. They are not prevailing.” 

It is one thing for a newspaper or a magazine to have a political or economic point of view. It is quite another for a media organ that does publicly admit to no affiliation to publicize a point of view to the unsuspecting reader or a viewer. Politically affiliated or owned publications occupy a very important and expanding space in the media business, with inroads into radio and television as well. There are various examples of such media houses: The CPI (M)’s People’s Democracy in English and the Lok Lehar in Hindi; Shiv Sena’s Saamna; the Rashtriya Swayamsevak Sangh’s Organiser; BJP’s Chandan Mintra owns the company which publishes The Pioneer; T. Venkataram (Ram) Reddy, nephew of Congress MP, T. Subbirami Reddy, has a substantial media empire comprising Andhra Bhoomi, Deccan Chronicle, Asian Age,and Financial Chronicle that are held under Deccan Chronicle Holdings Ltd.

Political lines are not always well delineated; it is often all in the family. Thus, Rajeev Shukla, the Union Minister of State for Parliamentary Affairs and secretary of the All India Congress Committee, controls the News 24 television channel with his wife Anuradha Prasad, who happens to be the sister of the BJP leader, Ravi Shankar Prasad. Between the two, they own not just News 24 but Aapno 24 and E24, held by News24 Broadcast India Ltd in the television space and Dhamaal 24 in the radio space. Besides, they own a production house, Studio 24, and a media institute, International School of Media and Entertainment. Both the radio company and the production house are held by B.A.G. Films & Media Ltd.

The Government of India’s monopoly over radio news is an excellent example of how political will can influence media industry. Soon after independence the GOI was conscious to make sure that it handled the radio with an iron fist so that the national sentiments could be controlled. The government was sceptical of allowing private players to enter the airwaves as it feared commercialization of news. However, in 1995 Supreme Court came out with an iconic judgement which declared that ‘the airwaves are public property’ and therefore could not be the monopoly of either government or business. The GOI interpreted this as an imperative to privatize the airwaves and this led to auctioning of airwaves and the rise of FM Radio. However, despite this judgment government’s broadcasting policy does not allow private channels to carry news or current affairs programmes or air live sports commentaries. Justice PB Sawant, the man who wrote the historic 1995 judgement, has pointed out – ‘It’ll just take one PIL to blow away this government monopoly.’ Yet, interestingly private players have never taken any action against government’s decision to hog news broadcasts on the radio. This lack of action on part of the private broadcasters has lowered the quality of radio content and has turned it into the commercial clutter FM Radio is infamous for. 

Any discussion on political influence on the media is incomplete without the mention of the Indian Emergency of 1975. During this internal emergency under Mrs Indira Gandhi’s regime pre-censorship was imposed in a draconian manner. This censorship was total and unparalleled. The government suppressed transmission of news by imposing censorship on newspapers, journals, radio, TV, telex, telegrams, news agencies and even tele-printer. News agencies had to get all their material censored in Delhi prior to transmission. Further, newspapers had to submit already censored news for re-censorship in their respective headquarters. What is more, even advertisements, cartoons and comic strips were subjected to pre-censorship. Foreign papers and journals were confiscated if they carried criticism of the emergency; some issues of Time and Newsweek were banned outright.
The underground press was, however, very active. More than 34 printing press were seized and over 7000 people arrested in connection with the publication and circulation of underground literature. Among the few over-ground publications that opposed the emergency despite stringent censorship regulations were: Sadhana (Gujarati), Himmat (edited by Rajmohan Gandhi), Freedom First (owned by M.R. Masani), The Statesman, The Indian Express, Daily Morosoli (Tamil), Tughlak (Tamil) and Radical Humanist. Most other national dailies like The Times of India, The Free Press, the Hindustan Standard and the National Herald “crawled when they were asked to bend”. 

The Indian Express very famously displayed the courage to defy the censorship orders, like no other publication did. When the Delhi edition appeared on June 28, The Indian Express carried a blank first editorial and The Financial Express reproduced in large type Rabindranth Tagore’s poem “Where the mind is without fear and the head is held high” concluding with the prayer “Into that heaven of freedom, my Father, let my country awake.” 

Such instances of media content during the emergency period clearly show how the political scenario can influence what the media writes or displays. Media industry can be compelled to change the rules of its trade because of various characteristics of the prevailing political environment. The structure of the government, political will, economic conditions, etc. all are important factors which influence the media industry. 

Business models emerge and affect the production of content in the media

Political economy was the original term used for studying economic phenomena like production, buying, and selling of products and services, and their relations with law, custom, and government, as well as with the distribution of national income and wealth. Political economy originated in moral philosophy. It was developed in the 18th century as the study of the economies of states, or polities, hence the term political economy. 
Political Economy

Today, theories of political economy focus on the politics and economics of media institutions and the texts they produce. Some traditions of political economy also consider how capitalist politics and economics exert themselves on media audiences. While viewing the relationship between media and political economy, it is important to see the latter’s association with classical Marxist theory and Marx’s statement (back in 1859) that social consciousness is determined not by the collective will of individuals but by the ruling classes who own the means of capitalist production. Thus, the form and content of our media and the social consciousness which nurtures the media, is affected less by the opinions of the majority and more by the financial motives of the rich who control the economics of our media.

Karl Marx

There are primarily two aspects of media’s political economy which have gained maximum visibility over the past few years. These aspects are patterns of media ownership (and the thus emerging models of businesses) and the concept of paid news. They are often seen over-lapping each other.

Media Ownership Trends

The question ‘Who owns the mass media?’ is a rather difficult one to answer. There are many media organisations in the country that are owned and controlled by a wide variety of entities including corporate bodies, societies and trusts and individuals. Information about such organisations and people is scattered, incomplete, and dated, thereby making it rather difficult to collate such information leave alone analyse it. Nevertheless, a few salient aspects about media ownership stand out from the inadequate information that is available. These features, as identified by renowned journalist Paranjoy Guha Thakurta, are:

The sheer number of media organisations and outlets often conceals the fact there is dominance over specific markets and market segments by a few.
The absence of restrictions on cross-media ownership implies that particular entities dominate markets both vertically (i.e., across different media such as print, radio, television and internet) as well as horizontally (namely, in particular geographical regions).
The promoters and controllers of media groups have traditionally held interests in many other business interests and continue to do so, often using their media outlets to further these.
The growing corporatization of the media is manifest in the manner in which large industrial conglomerates are acquiring direct and indirect interest in media groups. There is also a growing convergence between creators/producers of media content and those who distribute/disseminate the content which means the media content is bound to get influenced by factors like social acceptance and popularity.

The emergence of corporate entities in the media is the cause of an increasingly globalised but homogenized communication landscape, despite the growth of internet technology bringing about democratization by allowing for more user-generated content. While the growth of the internet has led to a collapse of geo-spatial boundaries and lower levels of gate-keeping in checking information flows, the perceived increase in diversity of opinion has been simultaneously accompanied – paradoxically – by a shrinking in the number of traditional media operations in television and print.
In the political economy of the media there is clearly an alarming absence of not-for-profit media organisations. Neither subscription - nor advertising revenue-based business models of the media have been able to limit this tendency of large sections of the corporate media to align with elite interest groups. This is the reason why certain news items get more coverage than others. For instance, major business houses having financial interests in the Indian Premium League promises the league much more media coverage (both in terms of time and space) than other sports. And what ensures the business houses’ inclination towards IPL is the age-old populist philosophy. The media is also perceived as an active political collaborator seeking to influence voters on the basis of allegiances of owners and editors. This can, and often does, constrain free and fair exchanges of views to facilitate democratic decision-making processes.

The Indian media market differs from those of developed countries in several ways. For one, India is a developing country and all segments of the media industry (including print and radio) are still growing unlike in developed countries. The media market in India remains highly fragmented, due to the large number of languages and the sheer size of the country. Despite these impressive numbers of publications, radio stations and television channels, the mass media in India is possibly dominated by less than a hundred large groups or conglomerates, which exercise considerable influence on what is read, heard, and watched. One example will illustrate this contention. Delhi is the only urban area in the world with 16 English daily newspapers; the top three publications, The Times of India, Hindustan Times, and The Economic Times, would account for over three-fourths of the total market for all English dailies.

Whenever calls have been made for putting in place certain restrictions over media ownership and control, media conglomerates have unanimously refused the idea saying it would invite devilish forms of press control and censorship. Many different arguments have been proposed in this regard - that regulation would stifle growth, that the multiplicity of media and the highly fragmented nature of the Indian market prevents monopolization, and that regulation of the sector amounts to an impingement on the Constitutional right to freedom of speech. 
That many media companies argue in favour of relaxed legislation with regard to media consolidation is not surprising, when one considers the difficulties of breaking even, let alone making money, in the business. From a business point of view, media consolidation has undeniable advantages. It allows for economies of scale, which enable media companies to absorb the costs of content and distribution over a large volume of revenue. This in turn allows companies to invest in better resources such as talent or technical equipment. In a competitive market, small media companies have a very hard time surviving. Consolidation makes a lot of economic sense and can even, to some extent, translate into improvements in quality.

However these corporate bodies fail to acknowledge the lop-sided reportage of news organizations, caused by restrictions imposed by corporate policies, which lead to a society with half-baked opinions and ideas. Another issue which needs to be taken into account is that today the large conglomerates of the Indian media are usually groups that own different companies. This allows them to have controlling stakes both in broadcasting and distribution by acquiring licences under their different subsidiary companies, thus totally bypassing current restrictions and defeating the purpose of their existence in the first place. And so, a report submitted by the Telecom Regulatory Authority of India (TRAI) in 2009 suggests that restrictions can no longer be placed on “companies” but on “entities” or groups, which would include large groups and conglomerates such as BCCL and Dainik Bhaskar.

What is unacceptable is media barons using news outlets as tools to further their business interests. Rupert Murdoch, whom we recently watched fall from the heights of his empire due to the News of the World phone-hacking scandal in the UK, had spun a whole web of political influence, based mostly on the power wielded by the many newspapers and organs of propaganda (such as the far-right conservative Fox News) at his command to influence public opinion. This was also true in Italy where media tycoon Silvio Berlusconi has been that country’s longest-serving Prime Minister after the Second World War.
A few recent developments point towards the growing corporatization of the India media and the growing convergence between producers of media content and those who distribute the content.

In January 2012, the Mukesh Ambani-led Reliance Industries Limited (RIL) – India’s biggest privately-owned corporate entity announced that it was entering into a complex, multi-layered financial arrangement that involved selling of its interests in the Andhra Pradesh- based Eenadu group founded by Ramoji Rao to the Network 18 group headed by Raghav Bahl and also funding the latter through a rights issue of shares. The deal was to make the combined conglomerate India’s biggest media group, according to Bahl -- bigger than media groups such as STAR controlled by Rupert Murdoch, and BCCL controlled by the Jain family.

In May 2012, the Aditya Birla group announced that it had acquired a 27.5 per cent stake in Living Media India Limited, a company headed by Aroon Purie. Living Media acts as a holding company and also owns 57.46 per cent in TV Today Network, the listed company that controls the group’s television channels (Aaj Tak and Headlines Today) and a host of publications (including India Today).

Deals like the these raise several key concerns relating to consolidation within the Indian media industry. With larger television broadcast networks, including Zee, Turner/CNN, Viacom/MTV and Sony, expected to acquire/partner regional networks, the commoditization of news seems almost inevitable but not necessarily desirable. In this country, as in the world over, large media corporations are today clearly playing a bigger role in the political economy that they report on. Though a free media is fundamental to the existence of a liberal democracy, concerns about the accountability and transparency of media companies remain.

For instance, the RIL deal has enabled Network 18, Eenadu, and the merged group to expand its offerings to benefit both its stakeholders and its advertising target audiences. What remains to be seen is whether clear boundaries can be etched between the boardroom and the newsroom. The deal, therefore, raises significant questions about the diminishing levels of media plurality in a multilingual and multicultural country. Most of the reportage on the deal has focused on its business aspects. Questions about the future nature of editorial control remain unanswered. The complicated holding structures and investments made through layers of subsidiary companies make it difficult to discern the real “bosses” and the powers they wield.

Debates on media ownership are almost as old as the nation itself. The country’s first Prime Minister Jawaharlal Nehru and his Defence Minister V.K. Krishna Menon would castigate the “jute press” in a clear reference to BCCL which was then controlled by the Sahu-Jain group which also controlled New Central Jute Mills. Then came references to the “steel press”. The Tata group, which has a substantial presence in the steel industry, used to be a part-owner of the company that publishes the once-influential The Statesman. Ramnath Goenka, who used to head The Indian Express group, made an aborted attempt in the 1960s to control the Indian Iron and Steel Company (IISCO). What was being clearly suggested by politicians was that particular family-owned groups would use their news companies to lobby for their other business interests.

Today, the situation described by Nehru has intensified multi-fold. In fact, instead of using their media companies to lobby for their non-media business interests, a few large media groups have been able to diversify their business activities, thanks to the profits generated by their media business. In India at present, promoters of media companies have subsidiary business interests in sectors as varied as aviation, hotels, cement, shipping, steel, education, automobiles, textiles, cricket, information technology, and real estate.

It is also very interesting to note that media companies tend to have a variety of professionals on their boards, such as investment bankers, venture capitalists, chartered accountants, corporate lawyers, and CEOs of big companies. Professional journalists, ironically, rarely figure. As a result, the decision-makers of our media are people who have probably never even studied or practiced the discipline of Journalism.

Paid News

Paid news or paid content are those articles in newspapers, magazines and the electronic media, which indicate favourable conditions for the institution that has paid for it. The Press Council defines Paid News as “any news or analysis appearing in any media (print or electronic) for a price in cash or kind as consideration.” The news is much like an advertisement but without the ad tag. This kind of news has been considered a serious malpractice since it deceives the citizens, not letting them know that the news is, in fact, an advertisement. Secondly, the payment modes usually violate tax laws and election spending laws. 

In 2003, Bennett Coleman Company Limited (publishers of The Times of India and The Economic Times, among other publications) started a “paid content” service - Medianet, which enabled them to charge advertisers for coverage of product launches or celebrity-related events. Many senior journalists criticized this initiative saying it is equivalent to buying and selling of media ethics. The idea of a newspaper entity taking money for performing its primary function of bringing out news seemed blasphemous. Bennett Coleman Co. Ltd. justified the concept of Medianet in an article in The Economic Times - '… all those shouting from the roof-tops admonishing sponsored stories have also turned a blind eye to the fact that some stories get into their newspapers, after veiled deals between public relations agencies and large sections of the media’. Indeed, some TOI journalists believe that blatant 'planting' of news and photographs by journalists acting in sync with PR agencies had triggered off the Medianet initiative. This article labels it as an attempt to “bring about more transparency and disclosure to the entertainment and lifestyle supplements of the group.”

In the run-up to the 2009 Lok Sabha elections, the practice of “paid news” emerged and became widespread in the political arena. This was the year when former Congress Chief Minister of Maharashtra, Ashok Chavan’s poll campaign for the State legislature drew scores of full pages of “news” wherein not a single one of those pages ever mentioned the name of Madhav Kinhalkar, his rival for the Bhokar seat. In a 2009-10 investigation into paid news, The Hindu found an article on Mr. Chavan that appeared word for word in three major rival publications. In two of them, on the same day - all of under different by-lines.
The leaking of tapes recording conversations between Niira Radia, a powerful lobbyist with clients such as the Tata group and Reliance Industries, and a variety of business men, politicians, and journalists revealed what had long been an open secret: the collusion and uncomfortable closeness among corporate units, politicians and journalists. 

The real challenges that lie ahead for the media in India are to ensure that growing concentration of ownership in the media market does not lead to loss of heterogeneity and plurality. In the absence of cross-media restrictions and with government policies contributing to further corporatization, especially with respect to the television medium, diversity of news flows could be adversely affected contributing to the continuing privatization and commodification of information instead of making it more of a “public good”.

Monday, 6 March 2017

Strategies for product, promotion, pricing, presentation and distribution citing case studies

Do the media organizations need to develop strategies for marketing? Talk of the strategies for product, promotion, pricing, presentation and distribution citing case studies.

Yes, in this era of competition, even other media organizations also need to develop strategies for marketing like other products to survive and promote themselves. They also need to be a part of constant aggressive marketing.
When marketing, firms need to create the right product, which is to be sold at the right price and place using the most suitable form of promotion. To market themselves, marketers and management Gurus over the years developed a set of guiding principles, which is also known as the Marketing Mix.
Marketing Mix

MARKETING MIX – It is a set of tactical marketing tools that a company uses to produce a desired response from its target market. Through this, a company influences demand for its product as it serves as a tool to help marketing planning and execution. The marketing mix can be divided into four groups of variables commonly known as the four Ps: Product, Price, Place (Or Distribution), and Promotion.

Promotion of a product can be done through various Marketing functions like Advertising, Public Relations, Personal selling, Direct Marketing and Sales Promotion. The key to producing results through promotions is ensuring that companies target the right consumers - those who are more apt to buy their products. Moreover, the message must be convincing and run frequently while producing the desired effects.

Promotion is a form of persuasive communication. In a free enterprise system where firms offer a wide range of new and better products, there always exist messages and distractions of all sorts.   As consumers do not have the time and energy to compare the competing products physically, they turn to advertisements for product information.  The present business environment being highly competitive, each firm wants the customers to buy its brand. Thus, this is why promotion is equated with persuasive communication.
The job of marketing is to identify consumer wants and then satisfy these wants with the right kind of products, at the right place and at the right price. 
The purpose of promotion is to convey to customers about how the features of the product will satisfy the consumer. For example, if a refrigerator manufacturer is planning to offer an off-season discount, it is essential to communicate to potential customers about the extent and period during which discount is available etc. Promotion is, thus, an essential part of the marketing function.

It helps the business in the following ways. At the same time, it also helps to strategize their activities for promotion.
  • Increase Brand Awareness - Promotions such as television, radio and magazine advertising increase brand awareness. New companies particularly have to advertise to apprise consumers who they are and what they offer. This is true with local or even national companies, as brand awareness can be measured by market, regionally or nationally. They need to work hard to be able to match the established competitors.
  • Provide Information - Marketers may run press releases to apprise consumers that their products can help certain ailments. A small consumer products manufacturer may use displays and pamphlets to describe the benefits of a new health food. High-tech manufacturers often use in-store videos and demonstrations to show people how to use their products. Promotions can inform people during all stages of the buying process, including their initial search. Small business owners also use promotions to inform consumers about price, product features and outlets that sell their products.
  • Increase Customer Traffic – Strategies in Promotion need to know on how to involve the consumers. When one gets to know about a scheme, they come running. It is a constant effort made on part of the promotions’ team.
  • Build Sales and Profits - The primary objective in using promotions to build sales and profits also helps them earn a loyal customer base.

There is a reason why marketers of Colgate toothpaste and Lux Soap advertise to appeal to customers. Even the most loyal customers must be reminded that the product has served them well over the years. This along with ‘Out and Loud’ advertisements that talk only about the product’s are what form the pattern and style of promotion. Thus, in addition to informing and persuading, another important purpose of promotion is reminding customers.  This is why manufactures of well-established brands like Colgate, Lux, Surf, Nescafe, Lifebuoy etc. extensively to sustain customers preference for their products.

Promotions are done through a variety of ways.

1. Contests
Contests are a frequently used promotional strategy. Many contests don't even require a purchase. The idea is to promote your brand and put your logo and name in front of the public.  Sponsoring contests can also bring attention to the product.

2. Social Media - These days Social Media Marketing allows brands to connect with a world of potential customers. This enables interactivity, feedback. They also use it as a medium to hold contests and polls.

3. Product Giveaways - allow potential customers to sample a product. Such a method is usually used to introduce new food and household products. Many of these companies also sponsor in-store promotions, giving away product samples to entice the buying public into trying new products
4. Causes and Charity - Promoting your products while supporting a cause can be an effective promotional strategy. The customers get a  socially conscious image; a product they can use and the sense of helping a cause
5. After-Sale Customer Surveys - contacting customers by telephone or mail after a sale puts the importance of customer satisfaction first while leaving the door open for a promotional opportunites.

Pricing- Of all the aspects of the marketing mix, price is the one, which creates sales revenue. The price of an item is clearly an important determinant of the value of sales made. Researching consumers' opinions about pricing is important as it indicates how they value what they are looking for as well as what they want to pay. An organization’s pricing policy will vary according to time and circumstances.
Many companies make common pricing mistakes. Weak controls on discounting, Price increases poorly executed and worldwide price inconsistencies are few of the common.
Moser Baer Entertainment Ltd. attained its objective of delivering original and quality movie watching at a lower price in the Indian Home Video Market. It captured the potential home video segment, which is threatened by rampant piracy. Moser Bear adopted a low cost structure. Its market positioning strategies through its value pricing by altering the key components of its value chain and leveraging on its core competencies. It also discusses about the intense competition and price war prevailing in the home video market.
As a storage device manufacturer, it entered the Home Video Industry and adopted low pricing as a strategy to position to itself. Starting at Rs 50/-, it has captured the market for a long time with its reduced prices in the industry.
Marketing departments use different but complementary strategies to increase revenue and profit. Pricing strategies use the price of a product or service to draw in new customers while maximizing profit from current customers. Non-pricing strategies use other methods such as branding to maintain market share without altering price. While pricing strategies are more common during economic downturns, real-life examples demonstrate that marketers often use non-pricing strategies alongside pricing strategies.

To get the pricing strategy right, a brand needs to arrive at prices that match their image as well the nature of the clientele (premium prices cant be charged for a middle-of-the-road option), while also covering your production and operational costs and delivering the profits necessary for the business survival.

In terms of media products, Bobby, the Telugu film released in 2002 was made to change its climax.  On release, the film climax was such that both the lead actors were killed. With the film receiving negative reviews and to bolster revenues, the climax was changed such that it was a happy ending. The change was made as research made them realize that Telugu audience in general don't prefer anti-climax.

In terms of FMCG, brand and products, Starbucks lowered the prices of its popular low-end drinks such as plain coffee and lattes in 2009. It adopted this pricing strategy to compete with McDonald's and Dunkin Donuts, who introduced less expensive low-end drinks to take over some of Starbucks' market share. However, Starbucks simultaneously raised the prices of its high-end drinks such as caramel macchiatos. Starbucks' non-pricing strategy of ubiquitous convenience developed brand loyalty and allowed for a price hike among loyal customers 

Placing a product, which is also known as Distribution.

As a product, Manchester United provides for an excellent football team that plays and wins in an exciting way. However, there are also other factors that define the product, e.g. merchandising such as the sale of shirts, and a range of memorabilia. The product also relates to television rights, and Manchester United's own television channel. Its products like books, t-shirts, key rings etc are sold across the globe, through the club's official website and a range of other sales media. 
Manchester United markets itself as a global brand. The club also engages in a range of joint promotional activities, for example with the mobile phone company Vodafone. The club has positioned itself at the upmarket premier end of the market and, as a result, it tends to charge premium prices to watch their home league games.
Therefore, Positioning or repositioning a product refers to locating that product within a market for example presenting it is an upmarket or down-market product, positioning it as a product for younger consumers or older consumers etc.
To position your product in the market, a company or a brand needs to adopt a few distribution or placement strategies.

A distribution strategy lays out the details of how you plan to get your product in the hands of your customers.
Before working out a distribution strategy, a few strategic decisions need to be taken. Them being:

-  What is it? -  it is the step where the consumer buys your product or service. It focuses on how to reach your target market and other important factors like location of your business and Target market, how to reach your target market, warehousing and transportation of the stock etc.
Locating your business - are you retailing direct to the public or working through an intermediary? Is it convenient for customers to visit you?
Importance of exposure to your business, location of your major competitors etc
- Channels of distribution – patterns of distribution among reseller, wholesaler, retailer, consumer. The pattern of how the product is travelling needs to be studied.

Logistics - order and receiving raw materials or finished products from your suppliers, storing the products to ensure they are ready for delivery to your customers in good condition, delivery of those finished products, transportation required etc.

Whenever a movie is released, Bollywood, Hollywood, Tollywood or Kollywood, its distribution is done only on the basis of a target audience. It is obvious that Bhojpuri cinema or a Tamil movie will not run as successfully as a Bollywood commercial movie in a Delhi hall.

Therefore, Place (or distribution) is a critical element of marketing – after all, marketing is about getting the right product, in the right quantity, to the right place, at the right time.

To end with, a perfect example that can be studied is from India’s newspaper industry.
The newspaper industry in India is witnessing intense competition from within and from outside like electronic and Internet media. Newspapers have become products like any other consumer, industrial or service products.
There is more and more focus on marketing and innovations in marketing strategies. The Times of India has been often criticized for ‘Trimming and Slimming’ the size of the newspaper. 
Often talked about, TOI and The Hindu make for one of the best examples to study media strategies.
A few months back, The Times Of India came up with a campaign indirectly hitting at the market leader The Hindu. The advertisement asked the people of Chennai to not go to sleep reading boring news served by newspapers, hinting at The Hindu and to wake up to the exciting content provided by The Times Of India.

The Hindu came back strongly with an integrated marketing campaign – TV, print and Internet.  The ads laced with sarcasm on the third grade news doled out by today’s newspapers. The Hindu had managed to convey its message very strongly, Stay ahead of the Times.

The Hindu not only nullified the TOI campaign but also managed to dub readers of other newspapers dumb. This definitely prompted people to reconsider their choice of the newspaper they read. The campaign is also made authentic because of the strong quality content that The Hindu has always been serving.
However, the TOI group has made constant innovations in marketing strategies – in product, price, promotion and distribution related areas. 

4P's Four P's

As is true with each of the Four P's, no one factor stands alone in its contribution to the overall marketing process. They draw on the collective data related to product, place, and price and incorporate that information into the advertising in a manner that is likely to entice customers to make a purchase. The actual scope of data used will vary, depending on what marketers perceive as being the key points most likely to appeal to certain customer demographics and increase the chances of the copy triggering a sale.

Media Ownership Patterns

The media that exists in our Country is heavily influenced by the ownership form it takes. There are a number of factors – such as content distribution, profits etc. There exist some very basic ownership Patterns.

Individual Ownership Pattern – In this kind of partnership, the Individual has control, which allows him to take decisions for the company. Therefore, he takes responsibility for all the Policy – making decisions and is also accountable for them. It is best suited for small-scale media houses, be it newspaper or news channel. An example of this are the Local Evening Newspapers that usually follow this kind of ownership control.  The News Today is a daily English Newspaper that is printed out of Chennai. It covers news, politics, economy and travel.

[Advantages] In this kind of ownership, power comes in the form of individual and absolute control, which gives the person more secrecy in options. Along with it, the individual can make decisions at his own pace (which is usually fast) and is naturally more connected with the content and the newspaper. 

[Disadvantages] However, the secrecy stops the employees from any kind of democratic participation. The owner becomes liable for the debts and losses and the rate of success depends entirely on his ability.  There is less scope for expansion and unlimited responsibility.

Partnership Ownership Pattern - As per the Partnership act 1932, Partnership is defined as ‘ the relationship between persons who have agreed to share profits of a business carried on by all or any of them acting for all. The minimum limit is 2 partners while the maximum is set to 20 partners. There are 2 kinds of partnership – General and Limited. In India, Red Chilies Entertainment is an example of Partnership.  It is a motion picture production and distribution company, it is headed by Shah Rukh Khan and Gauri Khan and operates under various divisions like Film Production, VFX, Television shows, TVC production and the IPL Team, KKR. Sanjiv Chawla is the executive producer while SRK and Gauri are the chairman and chairwoman respectively. Venky Mysore took over the CEO a few years back. 
[Advantages] In this kind of partnership, responsibility, maintenance and operation cost can be divided. People with different talents come together and pitch in their ideas and solutions which helps in the growth of the company and also sets a democratic environment for all. 
[Disadvantages] In a partnership, selfish motives of a partner might harm the firm. Lack of unity and misunderstandings might lead to losses after which each partner will have to incur and pay back his share of debt. Also, there are chances of a partnership/ business getting discontinued after the death of any partner.

Corporation – It is the one of the most common forms of ownership pattern. The minimum numbers that can be a part of it are 5. It is an association of individuals under the authority of the law, which has a continuous existence independent of the existence of its members and powers and liabilities distinct of its members. The BBC group is an example of a corporation. They are spread across web portals,  television and radio. Increasing capital can easily expand operations and transfer of control is flexible. However cooperation taxes are imposed

Group/ Chain Ownership – This form of ownership is when two or ore same mediums are handled by the same organization. They are formed without a common holding but with a chain of command.  Hindustan has 13 editions that are printed in Hindu, under HT Media. Aaj Tak and Headlines Today are two different channels but are held under the same organization i.e. India Today group.  The advantages of this kind of partnership are that financial, administrative and human resources can be centrally managed. Because of this cost of production becomes low due to best possible utilization of resources – this adds to better training, work environment and more facilities being provided. However, permanence of management is always in question because management is divided.

Employee Ownership Pattern - In this form of Partnership, employees own a major part of the share. They are also responsible for the decision- making. E.g.: Community Media like the Bangalore based advocacy group VOICES organized a gathering of community radio stakeholders. During the inception 1996, a group of radio broadcasters, policy planners, media professionals, and non-profit groups joined hands to study how community radio could be relevant to India and what policies were needed. They wanted All India Radio to allocate an hour of airtime each day to community broadcasting [Advantages] In this, Employee issues can be solved faster and it becomes easier to break interdepartmental barriers. Also, the sense of ownership that the employees own helps the organization to grow faster. 
[Disadvantages] However, it gets difficult to induct new people and employees tend to get more preference than the benefit of the organization. It also becomes difficult to take quick decisions.

Vertical Ownership Pattern- In this, an organization owns or operates different media enterprises or some other enterprise under the same ownership. E.g: India Today Group, Living Media or Big Media-Reliance group. The India Today Group has Mail Today, Business Today, Aaj Tak and Headlines Today under itself – making it a combination of magazines, newspapers and TV Channels, yet they still fall under the same ownership i.e. the India Today Group. [Advantages]  It helps to promote different enterprises at the same time and reduced general expenses but [Disadvantages] in this management may not be able to devote sufficient time to any one particular media. Also, since the capital is invested in all media forms, a particular media form might not get the attention that it ought to.

Prevalent Ownership Pattern - The 3 types of prevalent ownership patterns are Conglomerate, Company and Trust.

1. Conglomerate ownership Pattern – It is a combination of two or more companies engaged in different business that fall under one corporate structure. A Media Conglomerate is a multi industry company that owns a large number of companies in various media such as TV, Radio, and Internet etc. 
Examples are Viacom, Living Media Ltd., The Walt Disney Company, Bennett Coleman & Co. Ltd. Etc. Viacom is the fourth largest conglomerate in the World after the Walt Disney, News Corporation and Time Warner. Viacom has its assets in Nickelodeon, Paramount pictures, MTV, Comedy Central, VH1 etc. Reliance Industries Limited are also an example of one of the most famous conglomerates in India.

Examples are Viacom, Living Media Ltd

[Advantages] – The Diversification results in reduction of investment risk and creates an internal capital market. Also, the downturn suffered by one subsidiary can be counterbalanced by another. 
[Disadvantages] However a lack of focus and culture clashes can destroy the value. This form tends to have extra layers of management, which increases the cost.

2. Company Ownership Pattern - In this type of ownership, the company owns the media. The same company tends to have listed shares in the share market. For eg: HT media has shares in BSE, NSE, KK Birla Group has 69% stake in HT Media, HT manages newspaper, radio etc. similarly, Reliance has a stake in GBN(Global Broadcast News) which operates the English channel CNN-IBN and Hindi channel IBN7.

3. Trust ownership Pattern - A trust is a relationship whereby property (real or personal, tangible or intangible) is held by one party for the benefit of another. An example of this is the The Tribune Trust. It was founded on 2nd February 1881 by Mr. Sardar Singh Majithia and is run by a trust comprising of 5 trustees. It enjoys worldwide circulation and publishes 2 other newspapers also – The Punjabi Tribune and Dainik Tribune. This kind of partnership focus more on welfare and not on profit making. Advantages of this ownership pattern are that it focuses on real news rather than sensationalizing it. There are also not too many people which result in lesser clashes and more harmony. However, they might face a shortage of funds. Sometimes, it also takes time to reach the masses, as they don’t indulge in promotional activities.

These ownership patterns decide the business models, profit engagement and the content produced and distributed by the Media.  Financial flows, recovery of costs for creating, assembling and presenting the product are all determined by their outcomes.

Is it important for media content provider to understand its audience? If yes, how do they do it?

three different ways to understand

The most important source of revenue for a media house is through its advertisers. For advertisers, media is the most used and the most important medium for propagating and communicating about their products. But, no media business can exist without content that attracts consumers, or audiences, because audiences are those people to whom a media product is directed. Advertisers are keenly aware that the kinds of content they produce, distribute and exhibit must be attractive to audiences if money is to flow their way instead of to their competitors.

Though advertisers and media outlets are mutually helpful to each other, but their main target audiences are the customers, who depending on the advertisements decide upon their interests and preferences and then respond positively to these advertisements. This generates profits for the advertising company, which in turn is the major source of revenue for the media house.

For example, suppose ‘Pantaloons’ has a deal with the leading English daily ‘ The times of India’, then the readers who subscribe the newspaper will notice the advertisement of that particular brand also. This, as described earlier will be useful for both advertisers and media house.

But there are many difficulties associated while identifying the potential customers. The three main issues of concern for media executives are-
  1. How should we think about our audience? How should we define our audience?
  2. Will the material we are thinking of creating, distributing, or exhibiting to attract that audience generate adequate revenues?
  3. Were the people we thought would be attracted to our products in fact attracted to our products? Why or why not?

Executives who are charting the direction of media firms do not think about the members of their audience in the same way that they think about themselves. Take, for example, Kritika has a number of attributes associated with her, from physical to financial to emotional and many other factors. So, it becomes really difficult for the executives to know her personally. In fact, they are not really thinking specifically about Kritika at all. Instead, the characteristics that describe Kritika for a particular media are those that the media executives can use when they parade clusters of readers in front of potential advertisers as types of people the advertisers can reach through their media. Now, there might be some of her attributes which might make her attractive to a particular brand and certain other attributes to some other brand. These are the attributes that major advertisers consider when they think about buying space in media like newspapers, magazines, television and other medium of broadcasting. Now let’s consider an example, If Kritika is a 21 year old fashion designing student, then her course and her age might be useful for certain clothing lines and if she is a student who is staying alone in a city away from her parents and is financially unstable, then certain ads for educational loans and other financial aid might be useful for her.

But how does the media house identify such characteristics of the audience?
They do it through certain research, surveys and questionnaires. They even get some of their data from lists that are bought from the companies that bring together information about millions of people and sell that information to media firms.
Since , media outlets gets at least half of its revenue from advertising, its executives wants to keep subscribers who are attractive to advertisers, so they use the information they have about their subscribers that they have identified as being attractive to advertisers, to help them decide what kinds of materials in that particular media will keep these people as subscribers. These identified and selected population segments, then become the desired audience for the media vehicle. Once executives have identified the target segments, they try to learn things about them that will lead to increasing sales. That, in turn leads to more research to understand the groups.

For example, suppose Vaishali is a subscriber to a lifestyle magazine and she has some particular interests. Now, if the magazine is unable to produce content that will keep her glued to the magazine, she will cancel her subscription, which is not good for the business of the magazine.
Thinking about the audience, then, means learning to think of people primarily as consumers of media materials and other products. For media professionals, thinking about people in this way requires a combination of intuition and solid knowledge of the marketplace. When advertisers contribute all or part of a firm’s revenue stream, the firm’s executives have two challenges:

  • They have to create content that will attract audiences,
  • And they must also make sure that the content and the audience it brings in will be attractive to advertisers so that money flows its way, instead of to its competitors.

Sometimes, in fact media executives reverse the order of the questions. They first ask which audiences advertisers want to reach, and then look for ways to attract those audiences. For example, a particular channel has a time slot which caters to a particular genre of viewers, let’s take the channel ‘ Colors’ for instance, the 7-10 pm slot is covered by basically housewives and some young girls who prefer watching television serials. Now, the advertisers covet that particular group, so the important job for the production firms that work with the network is to come up with ideas that will be magnet to that age group.

Therefore, many companies spend a lot of energy deciding which audiences they should pursue ,what those audiences’ characteristics are, and what those audiences like and don’t like. Executives try to verify their intuitions and control their risks with research. In conducting this research, they think about the types of people who make up their audience- that is, they construct their audience- in three different ways which will be explained below with greater detail:

DEMOGRAPHICS: It refers to the characteristics by which people are divided into particular social categories. It’s one of the simplest and most common ways to construct audiences. Media executives focus on those characteristics, or factors, which they believe are most relevant to understanding how and why people use their medium. Demographic indicators include such factors as age, gender, occupation, ethnicity, race, and income. There can be various sub-categories or variants in these demographic characteristics.

PSYCHOGRAPHICS: It’s a way to differentiate among people or groups by categorizing them according to their attitudes, personality types, or motivation. It denotes the grouping of people into homogeneous segments on the basis of above said factors. They classify people according to their attitude towards life and their purchasing habits.

LIFESTYLE CATEGORIES: The third broad way to describe media audiences is by using lifestyle categories- finding activities in which potential audiences are involved that mark them as different from others in the audience or in the population at large. This kind of segmentation is determined by a large number of variables that may be categorized as purchase occasions, benefits sought, user status, or user age rate.