Professional Documents
Culture Documents
Copyright 2009 by the Case Research Journal, Guillermo DAndrea, Javier Silva, and Maricruz Prado.
The authors wish to thank Pedro Jos de Zavala, El Comercios senior marketing manager, for his cooperation and consideration in preparing this case. The authors also wish to thank the anonymous reviewers
who provided very useful comments and suggestions, and Lew Brown for his insightful comments and recommendations that strengthened the case. An earlier version of this case was presented at the North
American Case Research Association annual meeting, October 30November 1, 2008, Durham, New
Hampshire. This case was prepared by the authors for the sole purpose of providing material for classroom
discussion. It is not intended to illustrate either effective or ineffective handling of a managerial situation.
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Clearly, we need to take steps to remedy sales drops. Im sure well figure it out
and make it work, asserted Csar Pardo
Figueroa.
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
15") newspaperand its S/2.00 price (S/0.50S/1.50 above all other newspapers in
Lima), largely attracted upscale readers.3 However, on Sundays, its circulation and readership doubled as lower socio-economic segments (C, D and even E) scouted its pages
looking for job and business opportunities listed in its classified ad section. Trome was
a popular newspaper, designed to reach lower-income level households, printed in
tabloid format,4 and selling for S/0.50 from Mondays through Saturdays.
Advertising sales accounted for 57.5 percent of El Comercios revenues, but the countrys overall advertising market that neared US$189 million in 2001 had fallen by 6.4
percent as compared to the year before. More notably, 2001 advertising investments
were 44.6 percent below their 1997 total, US$341 million, as a result of a severe economic downturn.5 In an attempt to maintain its market share, most media had lowered
their rates, cutting down on their revenues. Perus major advertising media included
national television (capturing 43 percent of overall domestic advertising spending),
newspapers (33 percent), magazines (2 percent), radio (12 percent), and others, such as
street ads (10 percent).
EEEC offered several additional cultural and entertainment content products,
including books, magazines, brochures, CDs, printed materials, multimedia and video
products, which accounted for 19 percent of its sales in December 2001, up from their
5.1 percent share in December 1999. These additional products added value to its core
products and contributed to boost the companys revenues.
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
In order to boost Ojo sales, the company started to give away collectible booklets as
part of its promotion efforts. However, this strategy later backfired, as, from then on,
the company had to support sales with promotional activities requiring significant
investments that undermined product profitability.
While both companies competed for copy sales, EPENSA barely held a 10 percent
share of the newspaper advertising market, as large advertisers used newspapers to reach
higher-income readers in the A and B segments, who preferred El Comercio. Thus, 60
percent of EPENSAs revenues came from Correo, Ojo, Aj, and El Bocn copy sales,
while advertising sales accounted for 26 percent of its revenues and optional products
(books, magazines and CDs), for 14 percent.
In turn, newspaper segmentation hinged on content, pricing, and target audience.
Exhibit 3 shows category and brand shares of overall readership, as well as prices, while
Exhibit 4 presents a categorization of readers based on expected benefits.
Serious, traditional newspapers included El Comercio, La Repblica, and Ojo. El
Comercio led this group, capturing 19 percent of overall newspaper readership in 2001.
These newspapers covered several issuescurrent events, politics, sports, entertainmentwith an objective, rigorous approach. Their readers largely belonged to highand middle-income segments, with an intermediate or higher education. Most were
businessmen, executives or employees. Within this segment, El Comercio stood in a category of its own, as it featured all the information on current events, politics, sports and
entertainment, coupled with an outstanding classified ad section.
In a lower price range, a large group of newspapers, including inexpensive serious
newspapers, sports newspapers as well as entertainment papers and tabloidsboth collectively referred to as popularwere sold at around S/0.50 a copy for easy access by
all socio-economic strata (SES).
The inexpensive, serious newspaper segment emerged in 2000, when Lima witnessed the launch of Correo. This newspaper had a significant circulation in other
Peruvian cities. At that time, the market was teeming with sensationalistic tabloids like
To, Men, El Chino, and others, locally known as chicha6 newspapers. They focused on
show-business and police news, and their widespread publication had been partly funded by Alberto Fujimoris government from 1990 through 2000. Selling at S/0.50 and
printing mostly political contents in a tabloid format, Correo grew rapidly, introducing
a new segment in Lima. During its first year, it managed to secure a 4 percent share,
increasing it to 9 percent over its second year. Its readers belonged to B and C population segments and were characterized as progressive, concerned about their environment
and keen on enhancing their families living conditions.
Another group that commanded 10 percent of the market included sports newspapers, a segment that had shown no variations in 19982001. EPENSAs El Bocn and
Impresora Peruanas Lbero were the leading players in this segment, where EEEC was
not involved.
A category of newspapers within the popular segment focused on entertainment
news and had experienced fast growth in recent years. While they targeted C, D, and E
segments, they appealed mostly to youngsters and women with their common-language
coverage of show business, entertainment and police news. Competing newspapers in
this segment included El Popular, Aj, and Trome, launched in 1984, 1994, and 2001,
respectively.
Newspapers were primarily sold by 3,700 existing canillas (95 percent of copies)
and, to a lesser extent, in supermarkets, grocery, and convenience stores (4 percent) or
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
through subscriptions (1 percent). Every day, canillas (street salesmen) would pick up
newspaper copies from EEECs 24 distribution centers around Lima. A log recorded
copy deliveries, including the number of copies handed out to and sold by each salesman on a daily basis. Competitors would park their trucks near EEECs distribution
centers to deliver their papers to the very same salesmen.
TROMES LAUNCH
The crisis that swept across Peru in 1997, eroding the populations purchasing power
and driving overall sales down, eventually hit El Comercio, causing, for instance, its share
in Lima to drop from 25 percent to 19 percent. It was precisely then that EPENSA
launched its Correo in the capital city, where it quickly grew after its launching. See
Exhibit 5 for macroeconomic indicators.
Pedro Jos de Zavala recalled
Back then, we knew there were two distinctive business modelsproducts that prioritized advertising revenues designed for higher-income sectors, and low-priced products
for lower-income segments, whose business primarily hinged on circulation. El Comercio
belonged to the first group, and, therefore, the only way to expand coverage was to
develop a product that enabled us to reach new population segments and to avoid the
risk of focusing on a single product.
To assess the opportunity to offer a product for segments C and D and to identify
readers needs unsatisfied by other newspapers, a research study was commissioned to
Apoyo Opinin y Mercado.7 The purpose of this study was to determine the major benefits expected from 50-cent newspapers, as well as to outline leading popular newspapers image and positioning. In November 2000, several focus group studies included
25- to 55-year-old men and women from Limas C and D socio-economic strata, who
read and/or bought Aj, El Chino, El To, or El Popular newspapers, to unearth their purchasing and reading habits, their behavior in newsstands as well as readers met and
unmet needs.
Study findings revealed that:
Popular newspapers readers sought media that offered entertaining information in
an assorted, ingenious, non-vulgar fashion to read in their free time. For these population segments, a newspapers entertainment quality was crucial, especially for
leisure reading.
Readers in low-income segments also expected newspapers to support practical
improvements for their families living conditions. They valued an adequate coverage of health, food, education, and work-related news. Their customary saving of
articles and engagement in promotions proved this disposition.
Among current newspapers, Aj ranked at the top, while El Chino garnered critiques
for its crime-related articles. Both matched readers expectations with their light,
simple, concise and slightly roguish style. However, these media did not satisfy a
growing demand for a newspaper with a closer connection to families and living
conditions. El To tried to meet that demand with its sexual education brochures but
failed to get rid of its lurid tabloid reputation, with explicit contents that made it
difficult to take home, as one reader put it. Instead, these segments primarily
bought Ojo for its collectibles, although they viewed it as too long, too serious and
too expensive (S/1 above the others). El Popular, in turn, enjoyed strong appeal on
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
account of its colorful and contrasting presentation, but it had only managed to penetrate older segments that agreed with its open opposition to the former government.
A significant fact was that a large share of low-income segments decided what newspaper to buy at the point-of-sale. As revealed by focus groups, people seemed to have
two or three options in mind and finally preferred one over the others as a result of
issue specifics, such as a headline, the picture of the day, promotions or collectibles.
We choose among the papers we can buy with 50 cents, explained a reader.
Promotions seemed instrumental to boosting newspaper sales and to their positioning as sensitive to their readers needs. Yet, the most popular newspapers in this segment, Aj and El Chino, offered fewer promotions than other papers, like El To,
with fewer readers. A sound promotion had to amount to an excellent investment,
an opportunity to acquire essential household, children or school-related goods.
Nonetheless, the most distinctive finding revealed that all focus groupsregardless
of their gender, age, or SESagreed that 50-cent newspapers were unsuitable for
home reading. Among other reasons, their explicit pictures of semi-naked women in
sensual poses threatened childrens morality and offended mothers and wives sensitivity. Despite this fact, some male focus groups claimed to read the paper at home,
after cautiously removing any pornographic sections.
In turn, male interviewees of all ages and income segments revealed that they read
S/0.50 newspapers at newsstands and places allowing for a quick browse of headlines, such as workplacesespecially, at lunch breakor on public transportation
to and from work. For most male interviewees, reading the newspaper at work provided a little distraction before returning to their jobs; it also afforded them the quiet
required to focus on the newssomething they felt they could not do at home, with
their children around, particularly when the paper included pictures of nearly naked
women.
Some female interviewees claimed that they often read two and even three newspapers a day, as several family members purchased different newspapers in their households. One noted, My husband is a driver, and he buys Aj and brings it home. My
fifteen-year-old son brings home El Chino or whatever paper featuring Azucena, his
favorite model. So, I get to read two newspapers at home almost every day.
Exhibit 6 presents other conclusions drawn from this market research study. Based
on these conclusions and considering its own experience and track record, the company designed a new popular newspaper with superior contents and appealing promotions
to reach low-income households. It would focus on these segments interestsentertainment as well as quick and concise information. Exhibit 7 shows several pictures that
illustrate these segments life and customs.
Once it had designed the new paper, the company retained Apoyo, Opinin y
Mercados services for two additional studies. Intended to test the papers design, the
first study consisted of eight focus groups with 25- to 50-year-old men and women
from Limas C and D socio-economic segments, who bought Aj, El Chino, El To, or
El Popular newspapers. These groups met during the last week in November and the
first week of December. Most interviewees liked the new newspaper, but some adjustments were necessary as it had met more enthusiastic approval from older respondents,
while younger focus group participants argued that it seemed a bit dull, lacking a little
spark and color. This perception grew stronger as the new paper was compared to
more serious popular newspapers, like Correo, and led to a new positioningmidway
6
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
between serious papers and tabloids, trying to avoid a more vulgar style, but closing in
on the most entertaining newspapers.
After adjusting the new design, a second study in May 2001 tested newspaper acceptance, launch campaign impact and the promotion planned for frequent readers. This
study encompassed nine focus groups, made up of 25- to 50-year-old men and women
from metropolitan Limas C and D SES, who bought Aj, El Chino, El To, or El Popular
newspapers. A participant stated, It is a good paper; it doesnt have too much slang or
dirty language. For me, it is unusual to find so many different topics on one page. Articles
are straight to the point. This paper is going to succeed. It is just as cheap as a tabloid,
but it gives you more value. People have already grown tired of lying, pornographic newspapers.
In June 2001, the company launched Trome to cater to C and D SES, in an effort
to expand media coverage to reach new population sectors. One of its new readers
pointed out, I think its name is very suitable for this newspaper. Trome means ace,
champion, someone whos the best at what he does. Telling someone that he is a trome
is a compliment; it is like saying hes the coolest. And the same goes for this paperit
is the best paper among the 50-cent newspapers.
To serve this new audience, the company built a new editorial infrastructure with its
own writing team. This editorial structure was very small, with little impact on company overhead. As a result, this new product had a positive issue contribution margin. El
Comercio streamlined the new papers printing, distribution and marketing processes.
Figure 2 shows the resulting scheme. A former Ojo newspaper editor, Ral Hernndez,
was hired to manage Trome. A middle-aged, middle-class, well-educated man with vast
experience in popular tabloids, Hernndez seemed to fully support Tromes goal to
become an entertaining, popular newspaper that kept
the population informed. He was to focus on newspa- Figure 2 Organizational Structure
per contents, seeking to use a clear, straightforward style
based on everyday languageinformal, yet not vulgarand reader-friendly writing. Hernndez actually
matched the readership profile associated with Ojo, a
EDITORIAL
EDITORIAL
newspaper widely patronized by middle and lowincome segments that struck a balance between serious
PRINTING
journalism and popular appeal. Still, he was a formal
man, but he often used an old-fashioned jargontypiDISTRIBUTION
cal of Limas middle-class neighborhoods in the past
that did not match Tromes intended readership. For
instance, he referred to house maids as Natachas, a term
MARKETING
that was drawn from a very popular soap opera in the
1970s.
In addition to newspaper content and layout, front-page design was extremely
important, as many paper purchases derived from its impact. For illustrative purposes,
see a sample of an Aj newspaper issue in Exhibit 8 and a Trome issue in Exhibit 9. An
editorial followed the front page, and, next, came the articles on current events, politics
and police-related news. A sports section, followed by information for homemakers,
completed a typical Trome issue.
The front page always featured a promotioninitially involving a cutlery setin
addition to headlines on outstanding sports, police, politics and entertainment news
written in colloquial language. The newspapers second page included editorials and
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
useful information. The following sections focused on current political and police news
highly valued sections for targeted readers. Colorful pictures coupled with entertaining, imaginative articles reported news truthfully, avoiding lurid and ghoulish elaborations. This approach served as a means to both educate as well as preserve readers and
their families. While front-page headlines used colloquial language to lure readers, news
contents featured a more formal, objective style. The sports section included articles on
Peruvian athletes succeeding abroad and international soccer stars. Finally, the papers
last pages focused on show business news, cooking tips and recipes, health-related articles, entertainment, and useful information for homemakers in general.
Tromes back page included a section called las malcriadas (spoiled girls), with pictures of women taken from magazines published by other companies. This section was
the object of extensive debate before the newspapers launch, as Trome was to be, first
and foremost, a family paper. These pictures of models actually responded to focus
group findings, and chosen photographs held an aesthetic appeal without bordering on
pornography. The idea was to please some men, avoiding any offense to women and
children.
The company planned a special promotion to support Tromes launch, in an effort
to retain readers and, at the same time, to gain access to households. Every day, the
newspapers front-page contained a numbered coupon. Buyers could trade in five
coupons and pay S/2 to get top-quality cutlery sets at 15 points of sale scattered across
Lima. The complete silverware set included soup and teaspoons, dinner and dessert
forks, as well as dinner and butter knives. Out of the 1.92 million utensils purchased,
Trome still had 660,000 left. Management needed to determine whether the remaining
silverware was to be used to extend this promotion, which had cost S/904,000. See
Exhibit 10 for a summary of promotion results.
Tromes first-year editorial overhead amounted to S/1.13 million, while its marketing (excluding promotion costs) and administrative expenses stood at an estimated
S/565,000 and S/678,000, respectively. The company expected physical distribution to
be 3 percent of sales, while calculations pegged variable manufacturing costs (paper and
ink) at S/ 0.164 per copy. Perus overall sales tax accounted for 19 percent of retail prices.
While advertising sales had been expected to total S/1.5 million, their current estimates
did not exceed S/916,000.
DISTRIBUTION STRATEGY
The choice of a distribution strategy caused some debate. Alberto Cendra Astiz, new
business manager, argued for the creation of a new channel, featuring a specialized sales
force for lower socio-economic segments, while Antonio Cabrera, Circulation Manager,
believed Trome should be sold by the same salesmen who sold all other papers, ranging
from El Comercio, with its higher-income target, to Men, intended for lower population
segments. Indeed, newspaper salesmen naturally segmented their offerings based on
location rather than demographics. Thus, salesmen servicing areas predominantly populated by top A and B socio-economic segments mostly carried high-end newspapers,
including some papers for low-income sectors, and vice versa. Cabrera argued that using
a new channel or some selected salesmen could cause rifts with the street salesmen
union. As a result, management decided to use the same channel that distributed El
Comercio.
Print media companies had an arrangement with the local Newspaper Salesmen
Federation for fee payments: 25 percent on Mondays through Saturdays, and 30 percent
8
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
on Sundays. However, a few years back, an agreement had been forged to have new newspapers pay 30 percent and 35 percent, respectively. Accordingly, the Federation expected
EEEC to pay a 30 percent and 35 percent fee for Trome distribution and demanded a
written agreement to that effect. In AprilMay, the company rejected both demands and
offered to pay the standard fee applied to El Comercio and Correo distributionthat is,
25 percent and 30 percent. It also refused to sign an agreement on the grounds that
Federation leaders used those agreements to obtain other benefits and as the basis for
future claims.
Antonio Cabrera, the forty-year-old Circulation Manager, who had vast experience
in consumer distribution but had been in the company for a short time, could not persuade either EEECs General Manager or its New Business Manager to agree to
Federation demands. The latter stated that the Board was already aware of this decision,
which made it unchangeable. Federation leaders were clearly unhappy with this turn of
events, and it became clear that retaliatory measures could hamper Tromes launch on
Tuesday, June 20, 2001. The newspapers Circulation Department formulated a contingency plan with free-lance salesmen hired to sell Trome.
On its launch date, only 50 percent of Tromes circulation was distributed among
regular and free-lance salesmen. As days went by, regular newspaper salesmen increasingly wanted to sell Trome because they were losing fees. They knew the new paper
featured a widespread advertising campaign and a silverware promotion that had awakened peoples interest. However, Impresora Peruana and EPENSA threatened to cancel
their 30 percent and 35 percent fee agreement for new newspapers if the Federation
gave in to EEEC, further strengthening the unions position. This latest development
held great significance for Tromes success, as its launch advertising campaign continued
and potential readers could not find the new newspaper at points of sale.
DECISION-MAKING TIME
At a meeting held at company headquarters, EEECs Board discussed several options to
salvage Trome. Sales were clearly showing that something was amiss: of the 60,000
papers printed every day, only 36,000 were sold.
Csar Pardo, analytic and cost conscious and a fan of chess and historic fiction, wondered out loud, Perhaps we made a mistake when we set our goals, and we need to
revise them. The question is, which ones?
For Bernardo Roca, a possible solution lay in reformulating the papers content style
based on readers preferences. He made his point, In my opinion, the paper we have
printed so far is too stuffy for this segment. It doesnt have nearly enough content on
entertainment and local news to appeal to these readers.
Ral Hernndez argued, If we look at our competition and what readers are actually reading, its quite clear that we need to focus more on sex and violence, as they do,
because that is what our readers want.
In turn, Pedro Jose de Zavala wondered if it was really possible to maintain the
papers originally intended positioning, or whether it was time to give up on this idea
and withdraw the paper from the market. But, if we pursue that approach, we are
going to lose our advertisers, because they will never advertise in a paper that is all about
sex and violence! It is true, though, that this idea doesnt exactly thrill El Comercios
advertisers. Perhaps we should look for a different type of advertisersmaller companies that relate more to this market. Yet, how do we sell that kind of advertisement?
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
See Exhibit 11 for the most salient findings of the Market Research Units quantitative
study and Exhibit 12 for the insights revealed by a qualitative study commissioned to
IMASEN.
Exhibit 1
General Manager
Csar Pardoo Figueroa Turner
Publishing Director
Bernardo Roca Rey Mir Quesada
New Businesses
Alberto Cendra Astiz
Marketing
Pedro Jose de Zavaia
El Comercio Director
Trome Director
Raul Hernndez
ElComercioPeru.com
N TV Channel
El Comercio Editor
Trome Editor
Distribution
Antonio Cabrera
Adm. & Finance
Operations
Systems
Human Resources
Source: Company documents
10
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 2
1. MAP OF PERU
General Information
Total area: 1,285,216 km2 (496,225 sq. miles)
Limas area: 35,892 km (13,858 sq. miles)i.e., 3 percent of Perus overall area.
Total population: 26.1 million
Limas population: 7.2 million
Per-capita weighted average income: US$305.45
Urban population accounted for 72.3 percent, and rural
population accounted for 27.7 percent of the total national
population.
LIMA
TACNA
Source: www.peru.info.com
Description
Households
People
In 000s
In 000s
64.4
4.1
250.5
3.5
A1
High
15.7
1.0
68.0
0.9
A2
Middle-High
48.7
3.1
182.1
2.6
260.7
16.6
1,118.1
15.6
6.2
B
B1
Typical Middle
100.5
6.4
445.3
B2
Lower-Middle
160.2
10.2
674.5
9.4
502.6
32.0
2,312.1
32.3
207.3
13.2
914.3
12.8
C
C1
Rising Low
C2
Typical Low
295.3
18.8
1,399.7
19.5
Very low
551.3
35.1
2,596.7
36.3
Extreme Poverty
Total
191.6
12.2
879.6
12.3
1,570.7
100.0
7,162.3
100.0
11
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 2 (contd)
3. TRANSPORTATION MEANS IN EACH SES IN LIMA*
Responses
Total
2000 %
Total
2001 %
SES
A%
B%
C%
D%
E%
25
19
55
28
22
12
Car
13
16
96
47
11
Truck
29
Motorcycle
FOR WORK
Car
14
Tricycle
Bicycle
Light truck
Heavy truck
58
62
34
58
77
87
48
143
259
284
16.6%
32%
35.1%
NONE
Sample size
880
833
Weighted distribution
100%
100%
4.1%
99
12.2%
Total
2001 %
A%
B%
C%
D%
E%
Stove
99
99
100
99
99
99
97
Gas stove
77
77
71
90
92
67
47
Kerosene stove
41
41
10
34
58
64
Responses
Electric stove
Television
12
SES
56
17
96
95
100
100
98
94
83
55
59
100
94
73
40
18
48
43
21
27
31
56
67
24
21
25
31
25
17
Cable TV
23
23
96
59
22
Radio
90
89
98
92
92
85
81
43
63
53
77
60
52
51
27
31
98
71
31
15
26
27
51
36
22
22
32
24
19
52
25
24
13
Walkman
19
14
67
32
14
Electric iron
84
81
98
97
90
76
46
Blender
70
70
100
97
83
55
32
Refrigerator
60
61
10
95
82
40
46
44
98
85
50
24
Calculator
46
40
90
66
47
26
12
Camera
38
35
90
69
45
14
Fan
35
33
74
62
42
16
Sewing Machine
31
29
45
53
34
19
VHS recorder
28
28
91
64
31
10
Electric mixer
22
24
93
63
24
Typewriter
30
23
44
42
31
Mobile telephone
22
22
88
45
23
16
16
51
33
17
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 2 (contd)
4. APPLIANCE OWNERSHIP IN EACH SES IN LIMA* (CONTD)
Total
2001 %
A%
B%
C%
D%
60
16
Washing machine
20
20
98
64
15
20
19
92
61
13
20
18
84
47
17
15
17
100
51
13
14
15
87
47
11
Responses
Subscription-based mobile telephone
Total
2000 %
SES
E%
20
Vacuum cleaner
16
17
100
58
Musical instrument
17
15
50
34
13
Microwave oven
15
15
93
47
Computer (PC)
13
14
88
44
Toaster
12
12
81
39
Food processor
10
10
43
25
4
0
Electric shower
Video games/Nintendo/Play Station
Dryer
17
36
11
49
15
10
69
25
Heater
52
20
Electric heater
47
16
11
Internet connection
71
19
Video camera
46
Discman
32
10
Knitting machine
Sample size
880
833
48
143
259
284
99
Weighted distribution
100
100
4.1
16.6
32
35.1
12.2
13
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 3
1999
2000
2001
44%
28%
9%
7%
46%
28%
11%
7%
42%
25%
9%
8%
33%
19%
8%
6%
N/A
N/A
4%
4%
9%
9%
19%
16%
N/A
3%
17%
13%
N/A
4%
19%
14%
N/A
5%
22%
12%
5%
5%
15%
7%
4%
4%
15%
7%
4%
3%
1%
14%
6%
4%
3%
1%
11%
5%
4%
2%
2%
9%
5%
4%
10%
5%
5%
10%
5%
5%
10%
5%
5%
1,877.7
1,853.6
1,732.3
1,951.9
Prices
Mondays Sundays
Saturdays
2
3.5
1.5
2
1.5
2
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
Popular Newspapers
ENTERTAINMENT
AJA
Trome
El Popular
TABLOIDS
El Chino
El Tio
Extra
El Men
Sports Newspapers
El Bocon
Libero
Averaged Annual Readership
(in millions of people)
2000
2001
13.31%
8.87%
3.89%
12.96%
8.38%
4.66%
11.30%
5.90%
3.40%
N/A
N/A
14.40%
14.60%
N/A
6.08%
12.63%
N/A
8.80%
14.10%
5.80%
5.70%
El Chino
El Tio
Extra
El Men
9.35%
4.80%
4.91%
N/A
7.31%
7.43%
4.70%
3.06%
4.70%
Sports Newspapers
El Bocon
Libero
5.84%
7.20%
5.49%
5.45%
5.20%
5.70%
Popular Newspapers
ENTERTAINMENT
AJA
Trome
El Popular
TABLOIDS
2.00%
4.20%
Source: CCR, Auditing Study of Newspaper Sales at Points of Sale, Lima 19992000
Apoyo, Opinion & Mercado, Estudio de Auditoria de Venta de Diarios en Puntos de Venta, Lima 2001.
Note: In 2001, an average of 4,590,432 copies were sold every week.
14
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 3 (contd)
3. BRAND SHARE OF ADVERTISING INVESTMENT IN NEWSPAPERS
1999
70.6%
59.2%
4.8%
6.6%
2000
71.1%
58.9%
5.2%
7.1%
0%
N/A
0%
N/A
1.0%
1.0%
4.6%
3.3%
N/A
1.3%
4.7%
3.6%
N/A
1.1%
3.4%
2.6%
1.7%
0.8%
El Chino
El Tio
Extra
El Men
1.8%
0.6%
0.0%
1.2%
N/A
2.5%
0.7%
0.2%
1.6%
0.0%
1.9%
0.5%
0.1%
1.3%
0.0%
Sports Newspapers
El Bocon
Libero
3.1%
2.7%
0.4%
4.2%
3.5%
0.7%
3.4%
1.9%
1.5%
2001
73.7%
61.7%
4.5%
7.5%
Popular Newspapers
ENTERTAINMENT
AJA
Trome
El Popular
TABLOIDS
15
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Aspirational Utilitarian
Sample: Men and women, aged 18 or more, in socio-economic strata A, B and C, who read a newspaper at least once a week.
NEWSPAPER
PREFERENCES
NEWSPAPER
READING
HABITS
Traditional, Accountable
Nearly half belong to the B SES (47%)
while 42% belong to the C SES;
57% are women; 68% have a
higher education degree; 60% do not
workthey are housewives or
students; 33% are middle
management employees
Informed Cosmopolitan
SOCIAL AND
DEMOGRAPHIC
FEATURES
Exhibit 4
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Indifferent
Entertained
Exhibit 5
Macro-Economic Indicators
17
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 5 (contd)
4. HOUSEHOLD MONTHLY EXPENSES*
Responses
Food
Education
Socio-Economic Segment
B
C
D
US$
US$
US$
Total
2000
US$
Total
2001
US$
167
155
603
223
138
108
68
43
73
522
193
67
23
14
A
US$
E
US$
Transportation
40
46
172
75
41
28
23
Telephone
19
38
120
43
25
21
15
Electricity
18
20
83
32
19
11
10
44
16
880
833
48
143
259
284
99
100%
100%
4.1%
15.5%
32%
35%
12.3%
Water
Sample Size
Weighted distribution
Source: Apoyo, Opinin & Mercado, Socio-Economic Segmentation Study, July 2001.
18
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 6
Number of pages
24 pages accepted.
For some, additional pages should be separated from the newspapers
main body and should feature useful home or education information.
Front page
Pictures of girls
Sports information
Police news
information
Useful services
Food prices;
Utility service interruption announcements;
Courses at universities or institutes;
Missing persons.
Amenities
Highly appreciated.
Crossword puzzle.
Other games.
Sunday attractions
Employment classified ads, cooking recipes, school news, traditional medicine articles.
Promotions
Method: Qualitative.
Technique: Focus Groups.
Sample: Men and women, aged 25 through 55 years, in socio-economic segments C and D, who
read and buy Aj, El Popular, El Chino, and El To.
Focus Group Dates: Second and third week in November, 2000
Source: Apoyo, Opinin y Mercado, Lima, November 2000.
19
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 7
20
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 7 (contd)
Slums and squattersPerus extreme poverty
reflects on its capital city, where a large share
of the population lives in alarmingly precarious
conditions. Their lives are plagued by poverty,
no utilities, no sanitation. The color contrast
between houses in these slums and the signs
shown in the pictures above is very eloquent.
CanillaNewspaper street salesmen work nonstop from five in the morning through six in the
afternoon, when they have completed their
collections. In this case, El Correo holds a preeminent position in this canillas display.
21
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 8
1. FRONT- PAGE
2. SHOW BUSINESS
3. CURRENT EVENTS
4. PROMOTION
22
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 9
1. FRONT PAGE
2. SHOW BUSINESS
Today, A Free Spoon!! Ciggie burns matress, and smoke cools chink
3. CURRENT EVENTS
4. MALCRIADA
23
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 10
Trome Evolution
2. PROMOTION RESULTS
Silverware
Purchased
Traded in
Spoon
274,286
271,246
3,040
Butter knife
274,286
200,742
73,544
Knife
274,286
201,246
73,040
Fork
274,286
104,262
170,024
Tea spoon
274,286
104,061
170,225
Dessert fork
Total
Balance
274,286
104,365
169,921
1,920,002
1,260,208
659,792
24
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 11
33%
Gender
SES
Age
Male
Female
D/E
1525
2637
3850
51+
52%
48%
45%
55%
30%
26%
27%
17%
Frequency
Once
10.00
26 times
40.40
SES
Age
Male
%
Female
%
C
%
D/E
%
1525
%
2637
%
3850
%
51+
%
57
43
43
57
28
29
27
16
50
50
47
53
36
25
23
16
720 times
27.00
2030 times
9.10
more than
31 times
13.50
44
56
45
55
21
20
32
27
100.00
52
48
45
55
30
26
27
17
Total
Cutlery/Coupons Curiosity/Novelty/
New Paper
Information
Quality
Low Price
Low
34%
22%
31%
11%
9%
Moderate
34%
32%
13%
20%
12%
High
17%
62%
6%
21%
7%
Total
32%
30%
21%
16%
10%
49%
El Chino
Ojo
Correo
El Popular
29%
15%
15%
11%
7%
El To El Comercio
7%
6%
25
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 11 (contd)
5. REASONS TO BUY TROME FOR EACH SEGMENT*
TOTAL
Gender
SES
Age
Male
Female
D/E
1525
2637
3850
51+
30%
23%
38%
27%
33%
30%
32%
28%
31%
Curiosity/novelty/new paper
21%
25%
16%
28%
15%
21%
21%
23%
18%
Low price
10%
8%
12%
10%
10%
11%
9%
12%
8%
10%
12%
8%
8%
11%
7%
14%
8%
11%
News
9%
8%
10%
7%
11%
7%
7%
9%
14%
Front-page headline
5%
7%
3%
5%
5%
2%
2%
8%
10%
5%
5%
5%
4%
6%
6%
3%
5%
6%
Advertising
4%
6%
3%
5%
4%
5%
6%
5%
2%
Variety
4%
4%
4%
6%
2%
4%
4%
5%
4%
For information
4%
2%
6%
3%
5%
5%
5%
3%
3%
3%
6%
1%
3%
3%
6%
5%
1%
1%
For a relative
3%
3%
4%
3%
4%
5%
5%
2%
2%
3%
2%
3%
3%
2%
2%
1%
5%
3%
2%
3%
2%
3%
2%
2%
1%
5%
2%
News on politics
2%
4%
0%
3%
1%
2%
2%
1%
4%
Short articles
2%
3%
0%
3%
1%
1%
2%
2%
4%
Tips
1%
1%
1%
2%
1%
2%
1%
1%
2%
Cutlery/coupons
1%
0%
3%
1%
1%
2%
1%
1%
0%
Entertainment
1%
1%
1%
1%
1%
2%
1%
1%
0%
Total
Yes
SES
C
D/E
85%
83%
87%
No
8%
11%
6%
Unknown
7%
6%
7%
Total
Yes
SES
C
D/E
50%
46%
54%
No
38%
42%
35%
Unknown
12%
13%
11%
26
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
Exhibit 12
Trome was viewed as a newspaper in an intermediate category between formal, traditional newspapers and entertainment, or sensationalistic tabloids. This intermediate positioning resulted from
its objective news reporting, avoiding slang in headlines and gory pictures, and less police-related
information, coupled with an accessible price.
When asked to indicate Tromes differentiating factor, study participants mentioned its variety,
referring to the diversity of topics covered. Information diversity, however, did not drive participants to view it as a family newspaper, as it was perceived as a newspaper for adults.
Participants did not spontaneously characterize Trome as a useful newspaper, which denoted that
either this characteristic was not viewed as especially valuable or it was not clearly associated
with it.
To analyze Tromes offering, study participants were asked to imagine it as a person. In general,
Trome was described as a person who wanted to talk about everything, rather formal and grave,
but friendly. In some cases, it was viewed as a male, while other participants associated it with a
womanspecifically, a homemaker. This association was reinforced by the newspapers initial
promotion.
Tromes language choice was viewed as an attempt to stress its popular nature, but this was not
a trait closely associated with other newspaper characteristics.
According to participants, newspaper sections seemed to lack zest, an additional flavor offered
by other newspapers.
One of the most criticized features was Tromes front page. It was viewed as not attractive
enough to drive impulsive purchases. Participants indicated that it provided too much information
on topics, and, therefore, did not trigger readers curiosity. In addition, its graphic features were
considered unappealing. A newspaper could catch peoples attention through pictures or headlines, and, in most cases, Trome was failing to do so on either front.
In spite of a policy to respect sections, study participants felt that each Tromes section order was
not adequate.
Methodology: Focus Groups.
Sample: Men and women, aged 25 or more, from low-income sectors.
Dates: July 31 through August 13, 2001.
Source: IMASEN SA.
27
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.
NOTES
1. Socio-Economic Strata (SES) were used as a key variable for information screening.
SES referred to a significant number of people sharing economic and social traits
that distinguished them from other groups. A specific SES was assigned to each
household by adding the scores from five measurements that proved to provide reliable and valid information to characterize household socio-economic features. These
variables included household head education, household head occupation, washing
machine ownership, cleaning help, house faade, and number of bathrooms. Results
classified local populations into five segmentsA, B, C, D, and E.
2. Street newspaper salesmen. The first time a street newspaper salesman in Peru was
heard shouting the name of the paper he was selling was in 1867. This sale method
was so successful that it was quickly adopted by other newspapers, leading to a new
source of employment.
3. S/ stands for soles, Perus currency. In 2001, the exchange rate was US$1 = S/3.50.
4. Typically, tabloids were printed on 380mm x 300mm (15" x 12") sheets. This newspaper format was widely used because it facilitated reading, as compared to broadsheet formats (600mm by 380mm or 23.2" x 15"), preferred by more serious newspapers, like Great Britains Times, or the Berliner format (470mm x 315mm or 18.5"
x 12.4") used by Frances Le Monde. The term tabloid commonly referred to newspapers concentrating on sensational or lurid news, as the first newspapers of this
kind were printed on this smaller format.
5. Perus economic downturn since 1997, characterized by a public deficit nearing 2.5
percent of its GDP, was compounded by a political crisis that followed President
Alberto Fujimoris resignation after his controversial second election. A video footage
was broadcasted showing the administrations Intelligence Service (SIN) head,
Vladimiro Montesinos, bribing several country officials and businessmen to support
the government that was already vested with extraordinary powers.
6. Chicha newspapers were known for their vulgar, lurid sensationalism. Starting in
Lima, this type of press expanded to other provinces in tabloid format. It featured
colloquial language, colorful front pages with large headlines and huge pictures of
barely-clad women.
7. Perus largest and most renowned market research and polling agency, which also
operated in Bolivia and Ecuador. Its areas of expertise included marketing, advertising, customer loyalty, media and public opinion studies. In turn, its marketing area
focused on consumer and buyer research.
28
This document is authorized for use only in Marketing Estrat?gico DMGC10 by Pedro Jos? De Zavala, Universidad del Pacifico from November 2015 to April 2016.