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A PROJECT REPORT ON A Study on Marketing Plan of TATA SKY for 2012-13 Submitted in partial fulfillment of the requirement for

the award of degree of Masters of Management Studies (MMS) under Mumbai University Submitted by AMOL P. KHADKE ROLL NO: 20 BATCH: 2010-2012 Under the guidance of PROF. Dr. D.Y. PATIL

Bharati Vidyapeeth Institute of Management Studies & Research Sector 8, CBD-Belapur, Navi Mumbai 400614

ACKNOWLEDGEMENT

I express my deepest and most sincere thanks to my project guide, Dr. D.Y. Patil for providing me with all the facilities that have made working on my projects much easier than what it would have been otherwise. I would also like to express sincere thanks to Dr. D.Y. Patil, Director, Bharati Vidyapeeths Institute of Management Studies & Research (BVIMSR) for extending his support throughout our project work. I am thankful to all the respondents who spend their valuable time, by providing us with the required information, and I appreciate the respondents for putting forth their suggestions which helped us to gain more insight for this project.

EXECUTIVE SUMMARY
This project i.e. Marketing Plan - TATA SKY (2012-13) is purely focused on all the marketing activities for the financial year. Nowadays, more and more companies are coming up with their new DTH services to entertain the people in their life so there is cut throat competition in this industry. The introduction of the DTH market includes some vital detail about the growth, trends and needs of DTH Service. Soon after the beginning of the DTH service, in the opening only DD direct plus and Dish TV was successively doing their business but at the moment TATA SKY is also second-hand as DTH services. The objective of the project report is to prepare marketing plan for a year forecasting future growth of the DTH industry and also finding marketing strategies to meet the financial objective. We studied DTH industry growth and marketing strategies used by DHT service providers in previous years. We have collected secondary data which have analysed; tabulated which is then utilized in making strategies. Analysis and findings includes tables and graphs which were followed by meaningful interpretation.

CERTIFICATE OF THE GUIDE

This is to certify that Mr. Amol Khadke of Bharati Vidyapeeths Institute of Management Studies & Research has successfully completed the project work titled Marketing Plan TATA SKY (2012-13) in partial fulfilment of the requirement for Master in Management Studies as prescribed by Mumbai University. This project report is the record of authentic work carried out by him under my guidance. Date: Signature Faculty Guide: Prof. Dr. D.Y. Patil

TABLE OF CONTENT
Ch. No. 1. SITUATIONAL ANALYSIS 1.1 MARKET SUMMARY 1.1.1 MARKET GROWTH 1.1.2 MARKET TRENDS 1.1.3 MARKET NEEDS 1.1.4 MARKET DEMOGRAPHICS 1.2 SWOT ANALYSIS 1.3 COMPETITION ANALYSIS 1.4 PRODUCT OFFERING 1.5 KEY TO SUCCESS MARKETING STRATEGY 2.1 MISSION 2.2 MARKETING OBJECTIVES 2.3 FINANCIAL OBJECTIVES 2.4 TARGET MARKET 2.5 POSITIONING 2.6 MARKETING STRETAGIES 2.7 MARKETING MIX 2.8 FINANCIALS 2.9 HR CONTROLS 3.1 IMPLEMENTATION 3.2 CONTINGENCY PLANNING BIBLIOGRAPHY Chapter Name Page Number 6

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CHAPTER - 1 SITUATIONAL ANALYSIS

1.1 MARKET SUMMARY 1.1.1 MARKET GROWTH

The direct-to-home (DTH) industry in India, which currently has about 30 million subscribers and six players, is poised to grow to 60 million subscribers by the end of 2013, despite the fact that the industry faces several issues such as low ARPU (average revenue per user), high cost of acquisition of content and subscribers, and various taxes such as entertainment tax and service tax. In India, approximately 12 million set-top boxes are sold annually. While the DTH industry is working on new ideas, one of its areas of concern has been the availability of sufficient bandwidth, which would allow a DTH operator to telecast more than 500 channels. Some companies are working with DTH operators to develop two-three satellites to increase their capacity. However, it takes two-to-three years to build and launch a satellite and the cost of production is very high, taking about US$250-350 million. Currently, the industry faces various taxes such as license fee, service tax, entertainment tax and the additional value-added tax levied by certain state governments such as Andhra Pradesh and Madhya Pradesh. The DTH industry has a total turnover of Rs 6,000 crore and about 35 per cent of it is paid as tax by the industry. It is about time that the government recognised DTH as a sector similar to any other sector and not as a niche category. While it is true that the DTH industry is slowly spreading its roots, there is still some time left before the industry turns into a profitable venture. Nevertheless, it seems that investors have recognised the potential of the category. Currently, the game is about subscriber acquisition. As soon as the operators move beyond the acquisition mode, it is expected that the industry will be about retaining the consumer base and the game will change from there. Despite the global sinking of economies, the Asia Pacific market is healthy and the decline in growth will not derail the industry. With 1.7 million digital cable subscriptions, the digital paytv market is finally taking off and this degree of penetration represents a tipping point for our industry in Asia. The Indian DTH growth scenario bodes well for the advertising industry as well with over Rs 30-40 crores being earmarked by these companies annually for advertising revenues. Key factors affecting DTH in India 1. Low ARPUs (Average revenue Per User)

Heavy taxation (>50%) has lead to lower ARPUs (as low as Rs. 140/month) in the industry. As competition increases, falling prices will put further pressure on ARPUs.

Sources of incremental revenue like movies on demand is minimal and hasnt picked up yet. Indians still prefer to watch a pirated movie on cable or wait for its premier on TV channels. 2. High cost of acquiring subscribers

While superior technology of DTH leads to a superior viewing experience, the high price is a prohibiting factor. Therefore, to get the consumer hooked, companies subsidize the cost of the set-top boxes (STBs) needed to access DTH telecasts, which according to industry estimates is approx Rs. 4000 (including expenses for the cable, STBs and others per connection) The industry is at an early stage of growth and the primary focus of DTH operators is acquiring customers. It is estimated that the major growth could be witnessed in semi-urban areas and smaller towns and villages where cable services is not as advanced as in the metros and large cities Due to huge infrastructural costs, DTH players are currently undergoing losses. According to industry estimates, only on achieving a subscriber base of 7-8 mn, will the private operators break-even. However, with the advent of new competition, current operators are reducing their prices to capture the market by offering huge discounts thus increasing the pressure on ARPUs.

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36.2

37.6

35
30.4

33.8

30
Subscribe rs (M illions ) 26.1

25
20.9

20 15 10 5 0
0.06 2003 0.18 2004 0.75 2005 4.8 1.925 9.8 15

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Y ear

The DTH category is expected to grow by 680% or so in the next 7 or 8 years!

1.1.2 Market Trends DTH homes are estimated to increase to 30 million by 2012, from 14 million in 2008 according to Price Waterhouse Cooper. Due to Indias varied geography and population distribution, C&S penetration in remote and hilly areas is a problem. This creates a need-gap which the DTH operators could easily tap. Media industry experts feel that DTH is yet to see its full potential in terms of growth and is poised to go the way of the mobile phone services and acquire scale. To begin, DTH operators have started cutting prices to become more affordable. Following the trend of mobiles which saw a boom when call rates dropped, incoming calls became free and handsets became available at all-time-low price points. The cost of acquiring a DTH connection has become half of what it used to be when the service first began in India. Dish TV is now offering a set-top box for Rs 2,190. Sun Directs set-top box costs Rs 2,000. In the South we have also priced our connection at Rs 2,000 to compete with Sun, says Big TVs Arun Kapoor Some factors that will fuel the growth of DTH are: Government has made CAS (Conditional Access System) mandatory in parts of four metros from Jan 2007. Digital technology used in DTH services makes viewing experience better to the customer compared to old analog technology. DTH provide many value added services like Movies On Demand, quizzes for kids, games, live telecast of rituals in famous temples etc. for the first time in India. This could be the secret of success of the DTH players, showing high growth rates. Predictions of a DTH boom are also based on the fact that more and more people are buying television sets. India sells 12 to 14 million colour TVs in a year. Of these, 4-5 million are in the 29 inch-plus category, which could be a clear target for DTH services. 1.1.3 Market Needs 1. Reach

2.

National coverage Subscriber Management - Payment, Renewals, Recoveries VAS Focus on Interactive Services PPV Alerts Red Button promos New Innovations

(Urban & Rural)

3.

Customer Service Outstanding Customer Service at all Touch Points 24/7 Call Center Language support Engineering support

4.

Value Value for money brand Quality content Relevant packaging Exclusive / Niche content

1.1.4 MARKET DEMOGRAPHICS Indian cable TV subscribers are currently spending about 1.5 - 2% (US$ 4 - 5) of their monthly income on cable services. Globally, consumers spend 3 - 4% of their monthly income on pay television services. While this indicates a sizeable growth opportunity, only a mass service can achieve the economies of scale to fully exploit the market potential. This clearly is expensive business (At least in the short-medium run)

70% of DTH connections in India are from rural and small towns (population under a million), as per a report by a marketing research firm (Francis Kanoi) Dish TV and DDs Direct Plus DTH service are the market leaders in Rural India, while Tata Sky, Dish TV and Sun Direct DTH services are the preferred brands in top metros.The report does questions hypothesis over DTH subscribers TG and premium channels who are charging higher spot-rates owing to the stated subscriber base. Of course, part of this lop-sidedness arises from the fact that penetration of cable is high in Urban India, and rural is still an unserved market

Out of 13.2 million DTH subscribers, over seven million DTH subscribers are from rural markets alone. Maharashtra, Goa, Punjab, Uttar Pradesh, and Rajasthan are the leaders in DTH subscription, contributing over 6.4 million DTH connections or 48 per cent to the overall DTH subscriber base

North India and Western India together contribute over 8.4 million DTH subscribers, while the southern market contributes 3.2 million 126 million cable homes in the country, of which 50 per cent are based in rural India.

1.2 SWOT ANALYSIS FOR TATA SKY STRENGTHS

1. Leveraging on brand TATA and High brand recall 2. Technological expertise with Newscorps DTH arm Sky 3. Superior Picture quality 4. Leads in introducing new packages & Services 5. Customer service 6. Rural penetration through ITC E-Choupal and Godrej Aadhar 7. Interactive channels and program guides

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8. Innovative Product offering Tata Sky Plus WEAKNESSES

1. Second Mover after Dish TV who captured Market Share 2. Cannot match free service like DD 3. Currently Does not offer free Set Top Box like Dish TV 4. Litigation due to issues related to sports channels which it lost 5. Dependency on broadcaster and had issues with Sun TV OPPORTUNITIES

1. Larger disposable incomes with India 2. Tapping niche markets with Better service and Product offering 3. Expansion of distribution network through exclusive stores 4. Interactive advertising Tie up of with Samsung 5. Increase in number of TVs sold 6. Increase in the geographical boundaries with Rural Market untapped 7. Growing demand for quality of service in the form of DTH over Cable 8. CAS being made Compulsory would encourage switch. 9. Value Added Services are gaining steam.

THREATS

1. IPTV provides superior technology if implemented 2. Cable Set top Boxes provide easy switching due to negligible switching costs 3. Increasing Competition internally 4. Dependency on CPE suppliers to some extent 5. High dependence for transponders on ISRO 6. Dependency on broadcasters for their channel content and thus increase in cost 7. Videocon may enter DTH by building its own set top boxes. 8. No Exclusivity in Content and Rule of Must Carry 9. Cap on Investment (20%) 10. Interoperability Regulations 11. Cap on foreign Investment (49%)

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1.3 COMPETITIVE ANALYSIS TATA SKY, DISH TV, AIRTEL DTH, RELIANCE BIG TV: PRODUCT COMPARISON: India is a relatively new market for Direct To Home (DTH)/Direct Satellite Broadcasting. Since the first broadcast by Doordarshan in 1959, television broadcast in India has gone a long way. The two major leaps this industry took was in 1991 when deregulation made it possible for foreign players to jump into the Indian market and once again in 2004 when the KU Band direct to home broadcasting was legalised. Between 2004 and 2011, 7 Direct Satellite Service Providers have launched their services in India catering to an estimated 25 million subscribers, making India the second largest market after USA. In this article we will try and see how the different provider stack up against each other in terms of service quality and initiative and selling point.
1 DD Direct +

Launched in December 2004, it is the only free Direct To Home service in India. Launch by the public television broadcaster of India, Doordarshan, it currently is capable of carrying 59 channels but only carries 58. Notable channels include: 9XM, B4U Music and Russia Today. The service also carries 21 radio channels. Pros:

Its free. You dont pay a dime for this service. They are in the process of increasing the number of channels to about 100

Cons: Very very few channels. Many free to air channels are missing as well.

Tata Sky

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A joint venture between TATA and British Sky Broadcasting from UK, this service was launched in 2006. In terms of subscribers, it is the second biggest provider in India after Dish TV. It currently carries 185 channels. This includes 7 True HD channels. It launched its HD service on June 14, 2010 and HD DVR service branded Tatasky + HD in early 2011.

Pros:

Carries all the major channels available in India and some like Turner Classic Movies which is not available on any other DTH platform. Carries the Asli HD channels which include Star Movies HD, Star Plus HD, Star World HD and Star Gold HD It also allows a very diverse customization of the packages unlike other operators. The Set Top Boxes are from well known manufacturers and of good quality.

Cons:

Movies Now HD, ESPN HD, Nat Geo Adventure HD, Nat Geo Wild HD and Travel XP HD is not available on TataSky. Lack of Transponder space.

Tata Sky Features:


Joint venture with International DTH Brand-Sky, famous for its exquisite technology Uniform volume level across all channels Stable set-top-box with less bugs or issues Provides good Customer service and after-sales support Exclusive access to some authentic international channels like BBC entertainment,

Ceebebies Tata Sky Product Review: Tata Sky has made constant innovation and technology enhancements which are the main reasons that the company could provide a very stable set top box.

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As a result its customers have to worry less about the maintenance issues regarding the Set-Top Box. Another important feature which can be of great value to the customer is - the uniform volume level across all channels. This feature ensures that the customers dont have to waste time on adjusting the volume levels as they surf the channels. Tata Sky has customized its packages which enable the customer to choose and pay for only those channels which they require. Tata Sky provides excellent picture/audio quality. Tata Sky also provides installation services within 24 hours of the purchase of the product.

Dish TV

It is Indias oldest DTH operator and with over 10 million subscribers, also the largest in terms of subscriber base. They currently provide 247 channels including 3 True HD channels and 27 up-scaled channels. Since its satellite is positioned very near to that of DD Direct +, those channels are available on Dish TV as well. Dish TV also hired some transponders on AsiaSat 5, making it possible for them to add more channels in the future.

Pros:

Huge channel offering and one of the most experienced provider in the market. Carries many regional channels which other providers do not.

Cons:

The Set Top Boxes are mostly sourced from chinese companies. Carries 7 HD channels which does not include the Asli HD channels and the ESPNStar HD channels.

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Reliance Digital TV

This is the 5th DTH service launched in India. Reliance entered the market on 19th August, 2010. This service has seen two brand name change since inception. It was started as Reliance Blue Magic, later it came to be known as Big TV and now it has rebranded to Reliance Digital TV. Reliance launched its service in MPEG 4 in India. This allowed them to use their transponders more efficiently and provide more channels. It currently offers 247 channels.

Pros:

Has the highest number of Pay Per View channels. Provides STBs from well-known manufacturers.

Cons: HD Service has got only 6 channels. A big opaque logo appears on every channel.

Reliance BIG TV Features: Reliance Big TV uses MPEG-4 technology which can carry more number of channels Good picture and audio quality The Company makes its packages cost effective by providing lots of channels in base pack itself. It also provides a feature of viewing 12 channels at a time on single screen Good performance even during the monsoon season

Reliance Big TV Product Review: Reliance BIG TV is a cost-effective service whose base package comes with large number of channels.

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The customers get to select regional package based on their language/regional/cultural preferences. This entitles the customer to get an option to make a package having base package and any one of the regional languages like kannada, malayalam, telugu, hindi/Punjabi or oriya/Bengali packages. The set-top box of Big TV is little unstable. This acts as a disadvantage for the customers For the installation of the set-top box the customer has to wait for 3-4 days from the time of purchase

5.

Sun Direct

Launched in 2004, Sun Direct initially was only available in South India. Later on they ventured into the rest of India. Sun Direct carries the highest number of South Indian channels and mostly concentrate on the South Indian market. It is the first DTH provider in India to launch HD services. Its also the first to use MPEG 4 to carry its channels. It currently carries 199 channels including 3 True HD channels.

Pros:

High number of South Indian channels and so the DTH provider of choice if you are looking for regional content from South India. Initial cost is low.

Cons:

Has fewer numbers of channels compared to Dish TV and TataSky. Other providers give better value for money if you are not from South India

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6.

Airtel Digital TV

Launched by the Bharti Group, their mail selling point initially was the use of the most advanced technology for transmission, MPEG 4 DVB-S2, and a superior quality set top box. The lack of availability of KU band transponder has somewhat impeded their plans. The service currently carries 196 channels which includes 1 HD channel.

Pros:

Uses MPEG-4 DVB S2 for compression which provides better quality. Carries 7 HD channels.

Cons:

Lack of transponder space. Does not carry ESPN, Star HD channels.

Airtel Digital TV Features:

Airtel digital tv has good DVD Quality picture and CD quality It provides a universal remote which works both with TV and Set top box One of the major features of Airtel digital is that it exclusively offers World-space satellite radio channels. The set-top box provided by Airtel Digital is Sleek and stylish It provides better connectivity as provides a larger dish antenna Airtel Product Review: completely flawless DVD quality picture and sound. At the time when the other players were providing different remotes for set top box and television , Digital Tv has completely undone that issue by coming up with universal remote. Digital TV

It provides a sleek and stylish looking set top box. It also provides exclusive access to World-space channels

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While Airtel Digital tried to differentiate its product from the rest the high cost associated with it acted as a big negative aspect for the company The are many other players in the market providing lots of channels at a lower price, Digital TV by Airtel stands out as a lot costlier.

7.

Videocon d2h

Like Airtel Digital TV, Videocon D2H also uses MPEG-4 DVB S2 for transmission. This is the latest addition to the Indian market. It currently carries 267 channel which includes 4 Regular HD channels and 2 PPV HD channels. One of the major innovation they have done for the Indian market is to launch Satellite TVs which do not require set top boxes.

Pros:

Lots of channels, with competitive pricing. Has got 12 True HD regular channels, including Travel XP HD, Star Cricket HD and ESPN HD, which is not available on any other platform as of now. Has launched some Satellite TVs which do not require the set top boxes.

Cons:

A-la-carte channels prices are relatively higher.

Few Inferences from the above comparison: Tata Sky is the only DTH which provides uniform volume level across channels. Tata Sky and Big TV are better choice for rainy areas because of bigger antenna size. In case the customer is very selective about channels, Tata Sky is the best fit as it has lots of small packages and add-on packages so that the customers can customize the package as per their needs.

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To start enjoying DTH experience from today, go for Tata Sky because thats the only DTH which will be delivered and installed the same day after you place the order.

A recent survey done using the Television Audience Measurement (TAM) puts DD-Direct+ with 4.5 million homes at top with Dish TV having 2.1 million homes and Tata Sky capturing 1 million home. The following diagram shows the major players in the DTH industry and their market share.

1.4 PRODUCT OFFERINGS TATA SKY & TATA SKY PLUS Tata Sky satellite television service was launched on 8th August, 2006. Unlike analogue cable, customers able to watch all TV channels on Tata Sky+ in DVD quality picture and CD quality sound. In addition, you can record live TV, play back a recorded programme and pause & rewind live TV.

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Tata Sky+ has MPEG4 technology, and an in-built personal video recorder that enables you to record live TV, play back a recorded programme and pause & rewind live TV. These features are not available on Tata Sky service. PRODUCT DIFFERENTIATION: Tata Sky launches itself as a DTH services requiring a Dish, A set top box and network access card per television. Tata Sky as a product provides to its customers a large bouquet of channels at different pricing packages. These packages are formed according to ensure user convenience. Customers can select any of the various attractive package of channels available. Also the system provides the user with efficient navigation system as shown in the figure below:

It provides a large number of services to its customers. Various services provided by TATA Sky include: Active Services Active Cooking Active Stories Active Newsroom Active Darshan Active WizKids Active Sports Active learning Active Games Active Astrology Parental Control Search and Scan Banner Guide (including Hindi Display) Customer Service- 24 x 7 help Support in 11 languages

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Thus Tata Sky has all features to compete well with the existing players in the market. However Tata sky recently launched a new variant called Tata Sky +. This product contained some additional features over the original Tata Sky. Tata Sky+ is a premium set-top box with a personal video recorder that allows you to record up to 45 hours of live TV. Tata Sky+ gives you the power to record one program while watching another, pause a live telecast and even rewind a TV program that you are watching. Thus Tata sky gained an edge over its customers by adapting Product Differentiation. To protect its existing customer base using Tata Sky, it also introduced a special offer of up gradation to the premium product at reasonable cost. PRICE Price: Tata Sky has offered competitive pricing but has been on the higher end and its due to promotional campaigns it has added in incentives leading to increase in customer base. In search of newer audiences in smaller towns, DTH operator Tata Sky is introducing a new Rs 99 package Super Hit Pack Prices for TATA SKY are: Rs. 1,950 (inclusive of all taxes) Rs. 150 per month (Inclusive of all taxes) PLACE Place State Maharashtra Gujrat Karnataka Uttar Pradesh Tamil Nadu Punjab Orissa West Bengal Kerala Andhra Pradesh Rajasthan Assam Madhya Pradesh Others Total Share (%) 12.1 10.5 7.2 6.9 6.6 6.4 5.3 4.7 4.6 4.6 4.5 4.0 3.8 18.8 100 Clearly, there is a lot of scope of increase in the number of customers across all the states. Looking at the current distribution system that Tata Sky has adopted Including the local cable operators as distributors would be an extremely useful way of reaching out to the target market. Prices for TATA SKY PLUS are: Rs. 4,550 (Inclusive of all taxes) Rs. 225 per month (Inclusive of all taxes)

Packages starting from Packages starting from

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Place

State Share (%)

Maharashtra Gujrat Karnataka Uttar Pradesh Tamil Nadu Punjab Orissa West Bengal Kerala Andhra Pradesh Rajasthan Assam Madhya Pradesh Others Total

12.1 10.5 7.2 6.2 6.6 6.4 5.3 4.7 4.6 4.6 4.5 4.0 3.8 18.8 100

PROMOTION: In order to stay ahead of its competitors, Tata Sky has always followed an aggressive promotion strategy. When Tata Sky was about to be launched, it earmarked approximately Rs 1.5 billion for marketing the DTH service across all platforms, traditional and non-traditional. They invested not only in the pilot MDU (multi-dwelling unit) projects in some cities of India but also planned to educate an average Indian about the advantages of a DTH service supported by the Tatas and Star. A major part of the Rs 1.5 billion marketing budget was planned to be spent during the festival season in India, starting late September and lasting till Christmas-New Year, when consumers have a tendency to splurge on goodies.

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Meanwhile, apart from Zee Turner family of channels, most other major TV channels found a place on the Tata Sky platform INTERACTIVE ADVERTISING is a new stream of revenue that DTH operators are now eyeing. DTH operator Tata Sky has made the first move in this direction by tying up with consumer electronics major, Samsung. The company is also had talks with several mutual funds and financial services firms to advertise through its interactive services. The DTH operator believes that 68% of its consumer base belongs to the SEC A category and, therefore, represents consumers with high disposable income. A DTH user can access advertising content by clicking on an active button and can then access the information brochure on TV. If she/he needs more information, the consumers can then text to customer care. Industry players believe that DTH interactive advertising may work out to be the cheapest way to reach out to a targeted set of consumers and is likely to generate more interest in the future. One of its major competitors, Dish TV is also exploring its options. Tata Sky has also launched an interactive game quiz featured around Mahendra Singh Dhoni to coincide with the Twenty20 World Cup. In the past, the DTH operator has been test-piloting feature by running several contests around programmes and the interactive features were made available to its customers. For instance when the movie Dhoom was offered on its pay-per-view service, consumers were offered free goodies by participating in a contest. Recently Tata Sky signed Aamir Khan, one of Indias highly acclaimed actors, as a brand ambassador. The company believes that the actor makes a perfect fit with the Tata Sky brand values of trust, high-quality entertainment and innovation. As the brand ambassador, the actor will be instrumental in communicating the benefits of Tata Sky to consumers across the country. Aamir Khan will feature across all Tata Sky brand and product communication including advertisements on TV, Print, Outdoor, Radio and other mediums. Earlier also the company used various Bollywood celebrities for different campaigns like Hritik Roshan, Kiron Kher, Boman Irani and Paresh Rawal. Thus the company has followed an intensive promotion and advertising strategy. Its tag line Isko laga dala, toh life jingalala has become quite popular.

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1.5 KEY SUCCESS FACTORS Tata Sky hopes to have about eight million connections by 2012. How should Tata Sky increase its customer base faster given that DTH is a virtually homogenous product with very little content differentiation possible. The only differentiation is the picture quality. Tata Sky is similar to cable however they charge a premium because of taxes and also because the cable operators under declare subscribers. (Over coming barriers for growth and becoming a leader) The 3 anchors for growth that can be explored are a. Superior Picture quality Unlike analog cable, Tata Sky subscribers can view TV through superior digital DVD quality picture and CD quality sound b. Wide array of interactive applications In order to empower the Indian viewer with choice, control and convenience Tata Sky has a wide array of programming choices and interactive services like Actve Cooking, Actve Wizkids, Actve LearningActve StoriesActve GamesActve NewsroomActve STAR NewsActve AstrologyActve Darshan , , Actve Sports, , , , , and Actve Doordarshan that can be ordered with any of the basic packages. The customer is not going to stay forever with the package he subscribed to initially, he should be encouraged to subscribe to other packages and value added services quickly to increase revenues. These applications are expected to do well given that in India TV viewing in India is done as a family. c. Unparalleled customer service Tata Sky has established an extensive customer service network across the country. It has engaged a field force of approximately 3000 service engineers who are complemented by highend 24x7 call centres, manned by multi-lingual customer service associates, trained to solve all customer problems. Tata Sky takes direct responsibility for installing and servicing the hardware for periodic problems that exist at every subscriber's home, thereby ensuring the highest levels of customer service. Tata Sky retails its hardware and prepaid recharge vouchers through popular consumer electronic stores to enhance customer convenience. Indias first and only DTH service to have made a joint venture with a reputed international DTH brand, sky, which is famous for its exquisite technology. Introduction of new and unique features

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Introduction of schemes Improvement in picture and sound quality Better customer care service than before Appointed Amir Khan in his advertisement Easy availability or Good distribution network. Easy availability of recharge voucher. Good relation with distributor and retailer. Innovative advertising Only Tata Sky gives its users an exclusive access to some authentic

international channels which includes BBC Entertainment and Celebes

CHAPTER - 2 MARKETING STRATEGY


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2.1 Mission Tata Sky is set to revolutionise television viewing in India through its superior digital quality sound and picture. The service aims to empower the Indian viewer with choice convenient and control through its wide array of programming choices and interactive feature. Tata Sky endeavours to offer Indian viewers a world-class television viewing experience through its satellite television service. Tata Sky hopes to have about 12 million connections by 2012.

2.2 Marketing Objective


1. After investing around Rs 3,000 crore since its inception in August 2006 and clocking a

20 per cent market share in the DTH space.


2. Tata Sky Ltd plans to pump in more funds and launch new programmes to expand its

reach across India, where the DTH customer base is projected to double to four crore by 2012. 3. Currently, we have 5.5 million subscribers and we are aiming to achieve total subscriber base of 9.5 million by 2012. 4. That means Tata Sky to add 4 mn more subscribers by 2012 so that it can cover 25% of total DTH market in India. 5. Company will also give more focus to those state where its presence is not good like Rajasthan and Uttar Pradesh which have strong customer base.

2.3 Financial Objectives

1. Increase Revenue growth by growing number of customer base

2. Our projected revenue for FY 2012 is 5745 cr. 3. Projected sales growth by almost 50%.

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4. Increase EBDIT margin by 35% 5. Increase profit to 1235 cr. 6. Debt equity ratio 1:2

2.4 Target Market For the next year companys new target market will be rural areas.and untapped city & State and increase the presence in current market. A snapshot of the rural market: a. 199 million total household in India b. 119 million (60% of total house holds) TV households c. 50 million are having Cable d. 55 million TV sets in rural area e. Rural TV households growing by 3-4 million each year. f. Only 2-3 % of rural household have access to Cable g. Growing focus towards more satellite channels Strategies for the rural sector can be: a. Customizing offering b. Combination of various national channels with regional channels c. Educational Package d. Appointing the village head as Distributor and the promoter as the villagers tend to listen to village head e. This can be supplemented by giving the connection to village head free for initial period.tie ups with ITC E-Choupal and Godrej Aadhar give it wider rural reach. Also for its adopted a 360 degree marketing campaign approach that encapsulates television, print, outdoor and radio along with on-ground activities and marketing on the digital platform.

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2.5 MARKET SEGMENTATION

Geographic segmentation In terms of geographical location, North India and Western India together contribute over 8 million DTH subscribers, while the southern market contributes 3 million. The states of Maharashtra, Goa, Punjab, Uttar Pradesh, and Rajasthan are the leaders in DTH subscription, contributing over 6.5 million DTH connections to the overall base. Urban and Rural: In order to cater to the diverse taste and needs of both urban and rural people operators provide entirely different range of services and offerings. In rural areas, fleet of vans for demos, installation as well as selling hardware and pre-paid vouchers are being used. Most players are building up their subscriber base by targeting viewers outside the big cities, which suggests that about 60 per cent of DTH subscribers reside in rural areas and towns with a population under a million. Region and States: DTH service providers give special offers where regional and sports channels are viewed the most. Silver subscription available in Tamil Nadu, Kerala Karnataka & Pondicherry only, ultimate sports bonanza offer - Rs 2490 with 12 Months of Silver subscription available in Andhra Pradesh only. Demographic segmentation AGE and GENDER: Most of the players in DTH offer niche channels to create a unique and exciting offering for its viewers of every age and gender segment. DTH industry mainly concentrates on women who dont like missing their daily soap and news more ever women are able to learn English speaking which is a very special feature of DTH. DTH also concentrates on children also by providing them games, dictionary, some discovery videos specially inbuilt, maths, and science and social knowledge. It also focuses on old people as it has updated videos of various holy and religious places. Example- Dish TV recently launched Children Films Festival with a bouquet of over 25 super-hit films across various categories priced at Rs. 25/- per movie. thus targeting

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the children segment. Besides this value added services like Games Active, Bhakti active services etc carters to needs of customers from various age groups and gender. INCOME: DTH service provider gives various recharge options to consumer according to the income like silver pack, golden pack, diamond pack etc. Behavioural Segmentation OCCASIONS: DTH operators come out with new offers of channels or new buyer schemes at relatively cheaper rates on occasions of festivals or major sports events. For example it offers benefits to customers like: In a cricket match choosing the language of the commentary, camera angles, know player statistics and watch match highlights at our will 2.6 Positioning: A premium brand and the low-entry price is an attempt to cater to the bottom-of-the-pyramid subscribers. Being premium is not synonymous with being expensive Tata Sky has always taken the position that it is not interested in shoring up subscriber numbers at the cost of profitability. Company executives have also never missed the opportunity of claiming that it has the highest average revenue per user (ARPU) in the industry where Dish TV is the clear market leader in terms of subscriber numbers. Tata Sky is, however, convinced it has taken the right path and its pricing strategy isnt something that it has adopted for the first time. We were the first to break the Rs 100 price barrier in packaging; first to introduce HD service at an unimaginable price point and now, the first to provide a world-class quality DTH service at an affordable price point. Our service will now be affordable for consumers across all strata of the society. The company claims a subscriber base of 5.5 million, making it the third largest DTH player after Dish and Sun. Reducing the price of hardware does not mean the company, a joint venture between Tata Sons and News Corporation, will reduce the price of channel packs as well. The company has left the minimum subscription charges unchanged at Rs 160 per month. A huge increase in subscription to the DTH providers value-added services. Unlike other DTH operators who offer interactive services free, Tata Sky charges a fee. There is no reason to assume, new subscribers (after the reduction in set-top box prices) will not pay for interactive services. Interactive services like ACTIVE English and ACTIVE Cooking, for which the operator charges Rs 30 per application, have more subscribers in Tier II and Tier III cities than in urban areas. With our differentiated content, we will continue to earn sizeable revenue than competition,

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2.7 MARKETING STRATEGIES To Make Most of This Opportunity, we need to


1. Play the volume game

Address the mass market with a volume-led strategy Value based pricing will be the key to success
2. Innovate to differentiate

Adoption of global successRed button applications Payment modes Interactive programming New VAS & Products
3. Execute Effectively

Address market complexity Rapid scale up


4. Engage and advise the government / Regulator

Develop a pragmatic regulatory framework Correct current policy anomalies 5. Market Penetration Tata Sky can penetrate the market by: 1. Proving Competitively Priced Services 2. Innovative and Superior Technology 3. Interactive Services 4. Customer Support 6. Market Development Tata Sky can enter new markets by entering: 1. Rural Markets 2. Entering Neighbouring Countries (provided license available) a. Enter Commercial Space Offices , Coffee Shops, etc. 3. Enter Travel Area a. Long Distance Buses e.g. Tie up with Raj Travels

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b. Niche Car Segment 7. Product Development The product can be further developed with evolving time: 1. Combined with TV 2. Combined Dish for multiple Television (Society or Each Flat) 3. Tata Sky Plus is already a step in that direction 4. Target at educational needs in Rural areas where it could be used. 5. Stock Market Ticker and analysis can be included in Active

2.8 Marketing Mix 1. Product Tata Sky launches itself as a DTH services requiring a Dish, A set top box and network access card per television. Later variant like Community dish for entire building were launched. Latest the Tata Sky Plus with Personal Video Recording technology has been launched. We will be providing TATA Sky active services specific to different region. various services provided by TATA Sky include: 1. Active Services 2. Active Cooking 3. Active Stories 4. Active Newsroom 5. Active Darshan 6. Active WizKids 7. Active Sports 8. Active Learning 9. Active Games 10. Active Astrology
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11. Parental Control 12. Search and Scan Banner 13. Guide (including Hindi Display) 14. Customer Service- 24 x 7 help. Support in 11 languages

We will be launching new active services for educational guidelines Active Shiksha. And Active Agri which will be available in regional language

Price Competition has increased may fold with completion providing freebies and slashing prices. The following price related strategies could be adopted, which may lead to a short term loss but a medium term break even and profit: 1. Free Set Top: Following the line of Dish TV, Set top Boxes can be given free while ensuring lock in by providing base pack free for limited time duration, thus inducing update to next level. 2. Lock in of 1 year: Ensure long term lock ins by providing incentives for pre payment of long term charges. Continue with current strategy of providing 2 months free on payment of 10 months services. 3. Multiple Connections: Provide discounts for consumers buying second Tata Sky Connection (up to 50% off) 4. Encourage References: Provide discounts on Monthly charges if reference from existing consumer becomes a new customer. 5. Regional Disparity: Provide free regional packs in local areas to ensure switch from Cable TV to DTH service, i.e. provide free south Jumbo pack for customers in all Southern States. 6. Community Dish: Provide Incentives in the form of Free Months charges for first 3-6 months and reduce the Installation charges per flat. 7. Payment Options: Allow multiple points of payment, ensuring timely payment and convenience to the customer Credit Card through Website (implemented), Pre Paid cards from Retail shops to be activated using Telephone (Implemeneted) and Drop Boxes at Societies. 8. Postpaid: Some clients depending upon few background check criteria can be given Billing service i.e. Payment at end of Month

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Place Clearly, there is a lot of scope of increase in the number of customers across all the states. Looking at the current distribution system that Tata Sky has adopted: Including the local cable operators as distributors would be an extremely useful way of reaching out to the target market: a. Staff of cable operators be made the distributors for Tata Sky (familiarity with people) b. All distributors be given a status of Tata Sky employees c. Attractive options be given to them to become distributors Another focus could be the rural market. A snapshot of the rural market: a. 199 million total household in India b. 119 million (60% of total house holds) TV households c. 50 million are having Cable d. 55 million TV sets in rural area e. Rural TV households growing by 3-4 million each year. f. Only 2-3 % of rural household have access to Cable g. Growing focus towards more satellite channels Strategies for the rural sector can be: a. Customizing offering b. Combination of various national channels with regional channels c. Educational Package d. Appointing the village head as Distributor and the promoter as the villagers tend to listen to village head e. This can be supplemented by giving the connection to village head free for initial period Another avenue that can be explored is Mini Theatres (Class B towns) a. Setting up Mini Theatres in rural sector to promote the Product b. Events like Cricket matches, movies etc. c. These Mini Theatres can be the Point of Sales for Tata Sky

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Promotion The promotional strategies suggested are: 1. Packages for Special Events like the cricket World Cup 2. Targeting Tata employees could be a useful way pr promoting the product 3. Give the option of instalments and other promotional schemes to the new users 4. Tie up with real estate developers to target the new constructions a. The number of old buildings being demolished and being reconstructed are also on the rise. This could be a major target for promotions 5. Door to door marketing should be used to heighten the awareness levels as well 6. Local Games Sponsorships can also be used to increase the awareness levels 7. Another way could be using the prominent part of the Building for placing Hoardings of Tata Sky Ads a. Finding the strategic building in the locality b. Consideration can be in form of cash payment to the Housing society c. Providing free connections to Households in these buildings 8. Another new avenue that can be explored is the railway stations: a. Posters on railway station roofs b. Tickers at Major suburban Railway stations 9. Use of Internet- Applications which involve sharing of videos on how one consumes TV, benefits of DTH over cable TV, etc. across social networking sites like Orkut, ibibo, etc. 10. 'Ek-pe-Teen and Do-pe-Paanch' the offer entails three months of free subscription on the purchase of one connection, and five months of free subscription on purchase of two or more connections. 11. Tata Sky launched an interactive game quiz featured around MS Dhoni to coincide with the Twenty20 World Cup. In the past, the DTH operator has been test-piloting feature by running several contests around programmes and the interactive features were made available to its customers. Distribution

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The company has also built a wide distribution network to reach every household in India. It also entered into agreements with ITC's e-Choupal, Godrej's Aadhar and Indian Oil Corporation to extend its reach to the rural consumers. Tata Sky has also set up sales and service dealers (SSDs) across semi-urban and rural markets of India. The company adopted aggressive promotional strategies including television commercials (TVCs), outdoor, radio and Internet advertising.

2.9 Financials

TATA SKY FINANCIAL IMPACT Particulars Revenues Expenditure Operating income EBDIT Margin Depreciation Financial expenses(12%) PBT Less: tax Profit after tax FY 2008 310 355 -45 -14.50% 100 80 -225 0 -225 FY 2009 854 660 190 -22.20% 133 106 -49 0 -49 FY 2010 1523 1151 372 24.40% 177 85 110 37.12 72.88 FY 2011 2634 2073 561 21.20% 235 94 232 78.3 153.7 FY2012 3838 2878 959 25% 300 120 539 182 358 FY2013 5745 3935 1758 34.56% 370 135 1253 375.9 877.1

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Total assets Debt Equity

1000 667 333

1330 887 443

1769 708 1061

2353 784 1568

3000 1000 2000

3900 1200 2700

2.10 Human Resource VALUES AND ASPIRATIONS Ensure success through high performance by people. Regular visits by HR team are being made to all plants to meet the employees and also interaction meetings are conducted to get their feedback, based on which HR policies are improved continuously TRAINING AND DEVELOPMENT IN TATA SKY: Training in TATA SKY is aimed at the systematic development of knowledge, skills, attitude and teamwork. Training & development of personal skills is considered a high priority area for the TATA SKY The organization philosophy revolves around the development of people in this own jobs in such a manner so as to prepare them to face any difficulties. Enhancement of skills Suitable training is imparted to enhance the multiple skills of the executives and to enrich their multi-functional tasks. Programs are undertakes keeping in view the dynamic changes in the environment which are contributed by rapid technological obsolescence. Severe competition with emerging globalization of markets, increasing consumerism, new concepts of accountability and social responsibility among others. Attitudinal change in the employees mindset

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This dramatically evolving environment for employees requires a paradigm shift in modernizing the mind set and in preparing them to confront issues, manage them carefully and achieve competitive dominance.

PERFORMANCE APPRAISAL People come first in the new business paradigm. The success of an organization essentially depends upon the effective harnessing and utilization of this resource. It is imperative for an organization to constantly nurture people and have their capabilities for optimal performance. Performance evaluation aligns the organizational objectives with the individuals performance and bridges the gap between the two through consistent performance, planning, review and development Procedure for recruitment: To fill up the vacancies as approved by the management, two sources will be identified such as: Internal source External source

Preference will be given for internal source by tapping the potentials of the employees possessing multiple skills who can be redeployed In case on non redeployment of the existing employees, external source will be adopted either by approaching, data bank, employment offices, and advertisements. Source where ever it maybe mainly follows government rules and regulations before appointing new candidates. On receipts of applications through external sources, through screening will be done at the department tend. The short listed candidates will be called & interviewed by a committee consisting of respective HOD/section heads & one representative from HR department. The selection will be made based on the overall performance of the candidate and who has pee the companys requirement. The recommended candidates for selection by the committee will be put through final interview with JMD & CEO or the selection papers will be put up to JMD & CEO for JMD & CEO offer letters will be issued subject to their medical fitness duly certified by our medical superintendent

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On joining, the candidate will be required to fill up the joining report which includes nominations under provident fund, gratuity, group personal accident (GPA).The newly joined employees will be issued with a joining circular welcoming them for the company along with an advice to attend half day safety training programmed. Presently two types of registers are maintained. S t y l e i s o n e o f t h e s e v e n l e v e r s w h i c h t o p m a n a g e r s c a n u s e t o bring about organizational change. The style of organization according to the McKinseys framework becomes evident through the patterns of actions taken by members of the top management team over period of time. Human Resource Department: Working environment. Discipline. Health & safety. Work culture: Effective communication Working rules and regulations Attendance Paid holidays Leave Probation Deputation. TATA SKY has various departments under its wing. At any point of time, concerned departments may request the services of any employee of another department for a particular assignment. In such a case, the required employee may be put on deputation for that specific job.

STRUCTURE The design of the organizational structure is a critical task of the t o p management of the organization. It is the skeleton of the whole organization edifice. It prescribes the formal relationships among various positions and activities. Organizational structures are there along with the departmental data.

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ENHANCEMENT OF SKILLS Suitable training is imparted to enhance the multiple skills of the executives and to enrich their multifunctional tasks. Programs are undertaken keeping in view the dynamic changes in the environment, which are contributed by rapid technological obsolescence. Sever competition with emerging globalization markets, increasing consumerism, new concepts of accountability and social responsibility among others.

STAFF: In TATA SKY has a well established system of recruiting graduates from well-known institutions and providing them with on the j o b t r a i n i n g i n a n o . o f f u n c t i o n a l a r e a s b e f o r e d e c i d i n g o n t h e f i n a l placement in consultation with the person concerned

CHAPTER 3 CONTROL

TATA SKY will control sales via:


Geographic Market Organization. Increase in the no. of distributor inpan India They are investing 4% of profit in R&D facility to maintain Product competitive. Primary concern right now is penetrating into the Indian market via strong attacking techniques whereby maintaining defense strategy against other dth player

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3.1 Implementation: Value Positioning Value Pricing Promotional Pricing Differentiation o Image o Product o Channel Personnel Market Strategy

3.2 Contingency Planning Incase if any of our strategy does not work then we will take immediate corrective action and implement only those one which would be accepted by the market. Or we will give more focus on our current market so that we will have strong grip on current market. A company should be ready to tackle the threats like competitors adopting new technologies such as providing internet facility through present set top boxes.

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References
Bibliography http://en.wikipedia.org/wiki/Television_in_India www.sundirect.in/mediaDetails.php?mediaId=1 http://realinfo.info/index.php?topic=810.0;topicseen htttp://www.mumbaispace.com/dth/airtel-dth.htm

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http://www.tatasky.com/why-tata-sky.html http://en.wikipedia.org/wiki/Tata_Sky http://teck.in/dth-direct-to-home-tv-in-india-features-and-price-comparison.html http://www.tatasky.com/why-tata-sky.html http://en.wikipedia.org/wiki/Tata_Sky Marketing Management of Philips Kotler

6. Appendix Advertising budget in different media vehicle

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