For organisations entering new markets and product segments it is essential to understand the unique needs of their potential customers. Success in one geography does not always guarantee success everywhere.
The task of entering a new market is made even more difficult when there are established players that present significant competition. Despite all odds, Dainik Bhaskar entered Gujarat with a Gujarati daily (Divya Bhaskar) and became the #1 newspaper in Ahmedabad on the day of the launch.
Until the early 2000s, Dainik Bhaskar was a Hindi language newspaper circulated in Madhya Pradesh, Jaipur in Rajasthan, Chandigarh in Punjab and Haryana. Given the need to grow in other lucrative markets, Dainik Bhaskar did not want to be constrained by language.
Girish Agarwal, Director of the Bhaskar Group, says: "Having broken the geographic barrier, we now wanted to break the language barrier." The first step in choosing to change its geographical track was to choose the market. "After careful consideration, we decided that it could be Ahmedabad," says Agarwal.
MONITOR'S TEN TYPES OF INNOVATION FRAMEWORK: DAINIK BHASKAR
1. Business model: Using a pre-paid model at a large scale to convince advertisers and vendors of the circulation at launch.
2. Enabling process: Using a "crowdsourcing" approach to provide potential consumers increased leverage in designing a new product.
3. Core process: Developing a consumer-centered, repeatable process to launch media products in unfamiliar geographies and new languages.
4. Product performance: A localised content offering based on superior knowledge of the needs of Gujarati newspaper readers.
5. Brand: Using the research process as a platform to promote the brand.
6. Customer experience: A unique model of consumer engagement that enables Dainik Bhaskar to build awareness, obtain insights and build loyalty rapidly in a new market.
Organisations that achieve breakthrough innovation usually cover at least 3-4 types of innovation included in the framework. Dainik Bhaskar fulfils six.
After this, the group set out to understand the needs of potential customers. For this, they contracted over 1,450 researchers to survey 1.2 million homes and conducted 54 focus groups in Ahmedabad and six neighbouring districts.
This sample is larger than the combined sample size of the Indian Readership Survey or IRS and the National Readership Survey or NRS for two years. The researchers were trained extensively on key interview skills to be more effective and also aid in building the Divya Bhaskar brand. In the survey, people were asked what they wanted from a newspaper and what the current newspapers lacked.
The feedback from the focus groups seemed confusing at first. "By the end of it, we were very confused with the hints," Agarwal recalls. "We had given four options to potential readers for the price of the new paper (Rs 3, Rs 2.50, Rs 2 and Rs 1.50). But 40 per cent said Rs 2, and 30 per cent wanted Rs 2.50, while the rest said Rs 1.50."
Why would the lay reader opt for a higher price? The group then decided not to follow the hints that traditional market research was throwing up. "We realised that people often quote a higher price as they don't want to appear like they are going for a cheap substitute in front of others," says Agarwal.
The entire exercise helped Dainik Bhaskar to shape the content of the newspaper to the needs of the customers, and also gave it new insights into the Gujarati market.
In the second stage, they revisited the 1.2 million people surveyed with a pre-paid subscription offer to Divya Bhaskar. Conversion rates were high as people saw their feedback being incorporated in the design of the paper. It also helped rope in vendors who saw a large reader base already demanding this paper. This was the final nail in the coffin for any threat that competition could pose.
The large numbers of pre-paid subscription were also helpful in roping in advertisers faster, leading to much higher revenues. The result? Divya Bhaskar's launch edition sold 4,52,000 copies, taking it straight to the #1 position.
One key aspect of the innovation was using consumer research for two-way communication, effectively doubling the impact of each interaction. This approach was effectively a form of "crowdsourcing," where a company finds a way to get the input of a large number of consumers to help configure an offering.
In addition to extracting the information that was relevant to the creation of a new, market appropriate product, the experience that consumers received over the course of the two visits was enough of a differentiator to cement a relationship that resulted in high conversion to subscriptions.
Divya Bhaskar has continued to leverage its knowledge of the Gujarati market to launch other editions in Gujarat to fill market gaps and niches. DB Gold became Surat's first afternoon paper catering to the needs of industrialists, traders and the business community.
Leveraging the learning from Gujarat, Dainik Bhaskar has launched DNA in Mumbai—another new language in a new geography. DNA is at present #2 in terms of circulation in that city. What began as an innovative, experimental process has become a core aspect of their way of doing business.
At present, Divya Bhaskar has a circulation of 11.5 lakh in Gujarat with nine editions.