In the morning of December 15, 2010, Mr. Rohit Kumar, Area Sales Manager (North Bihar) of Global TV Limited
was quite upset. He was anxious about the Annual Sales Meeting that he had to attend in the coming week in New Delhi. Rohit had left his previous organization, Vishal Network Ltd., three months back after working there in direct sales for around seven years. He had an excellent sales record. He had been appointed as the Area Sales Manager of Global TV Limited and was held responsible for the complete North Bihar region. North Bihar sales area covered the northern part of Bihar, comprising of primarily Muzaffarpur, Motihari and Sitamahri districts. The company had huge expectations from him. Rohit was therefore feeling concerned and was trying to devise some concrete plans which would facilitate him in escalating Global TV Limited’s market share in north Bihar, thereby moving towards fulfilling the company’s expectations. A great opportunity in the form of the forthcoming ICC World Cup 2011 was knocking at the door and Rohit recognized that with the cricket fans of north Bihar, it was a make or break opportunity which he required to tap with the pre-arranged organizational resources
. Rohit appointed some of his sales people to conduct micro-level attitudinal survey on the prospective customers of north Bihar. The results highlighted the important factors hindering the increase in customer base. Rohit prepared a list of these factors: Factor 1 – Satisfactory existing relationship with the local cable operator: Customers had a positive and favorable attitude towards the cable operators because of their familiarity and long-term relationships with them. The customers felt that the cable operator was known to them personally and attended to all the technical complaints as early as possible. Therefore, they did not feel the need to change over to the DTH system. Factor 2 – DTH perceived as a rich man’s service: there was a perception amongst the customers that the DTH service was for the rich people, and not for the middle class. Factor 3 – Higher installation and rental charge of DTH: For a package of about 125 channels that included the major channel categories and most watched channels, cable providers charged a rental of Rs.180 per month in the suburban areas. They even kept the installation charges very low. In cities, the cable providers usually took deposits to the tune of Rs. 500 which was reimbursable at the time of discontinuance of the services by the customer. DTH, on the other hand, had high set-up costs, including the installation charges and monthly subscription charges. The initial set-up for DTH required a price as high as Rs. 1000 and the channel package offers were priced over and above this. The rental charged was perceived to be quite high by the consumers. This resulted in lower switching of consumers from cable to DTH. The price per channel ratio was also very high in case of DTH providers, and cable was stealing the march in this area over them. It was thus important for DTH to improve its distribution and customer services rapidly to meet the increasing customer participation in the process of value realization. Also, DTH had to closely monitor its costs to be able to challenge cable’s supremacy. Factor 4 – Cumbersome payment procedure: it was found that the prospective customers considered the payment procedure of DTH service very cumbersome. In case of cheque payments, normally the drop box method was being used. But the number of drop boxes was highly inadequate in smaller towns. Furthermore, only cheques above Rs. 1500 could be deposited. Another payment option was e-charging, but customers of rural areas and suburbs were unable to use this option due to low penetration of internet. For paying through the mobile option, handsets required to support JAVA MIDP 2.1 and telecom connection was needed to be GPRS activated. Connection error in GPRS, unavailability of network, incorrect PI, incorrect Global Sky subscriber id, incorrect card details, etc. led to transaction failures. On the other hand, the cable operator was normally a local person and collected the rentals from home at a convenient time of the customer. Factor 5- no differentiation between DTH brands: this factor highlighted the fact that there were a growing number of DTH service providers creating a clutter. There was not much differentiation between them which confused the customers in their purchase decisions. Thus, the DTH brands needed to differentiate themselves from each other in the market to capture more continued attention of the consumers. Moreover, in the last week, one of Rohit’s friends had said that all DTH services were very expensive and therefore did not target the middle class population of India. This made him think that if the mobile market could appeal to mass market, why not DTH? Till now. The company had concentrated their marketing efforts towards the urban high-middle class
and upper class niche. Now it was time to concentrate on changing the middle income customers’ attitude and perception towards the DTH services as well as the Global TV brand
. With these thoughts in mind, Rohit finally sat down to prepare a comprehensive marketing plan to address all the challenges and thereby come up with a strategy to augment the market share. A Which model of attitude formation is applicable in this case? Prepare a 5 M questionnaire to measure the attitude as per the app cable model. B Which aspects of Maslow’s hierarchy would you address to change 5M consumers’ motivation towards DTH? Which theory of learning would you adopt to teach consumers about DTH and Global TV?