DTH to splurge Rs 6 bn on ads in FY'11

MUMBAI/ BANGALORE: The plot hasn‘t changed much for the direct-to-home (DTH) operators in 2010. A gang of six private players are fighting over subscriber growth and attempting to expand the digital universe in a country where the television landscape is mostly analogue cable.

The warfare is spreading over to the advertising world as each DTH player wants to play the volume game amid low ARPUs (average revenue per user). The usage of celebrities, whether it is Shah Rukh Khan or Aamir Khan or Hrithik Roshan or the Kareena Kapoor-Saif Ali Khan duo, in television commercials is to entice subscribers to take the DTH route. 
The DTH operators are going to splurge Rs 6 billion towards marketing across TV, print and other mediums this fiscal as they aim to add 11 million subscribers due to a spate of sporting events. In terms of ad spend, Tata Sky would be leading the pack with Airtel Digital TV and Dish TV in near-distance company.

"Tata Sky‘s ad spend will be around Rs 1.2 billion, followed by Airtel Digital TV. Dish TV will have a marketing expense of Rs 1 billion while Reliance Big TV will spend over Rs 800 million," says an industry-tracker.

Videocon is preparing for a bigger ad exposure for its d2h brand in the second half of the year. "We were present in the IPL and are lining up a bigger ad splash in the coming months. Our ad spend for promoting our DTH service will be Rs 800 million this fiscal," says Videocon Group director Saurabh Dhoot.

DTH operators were equally aggressive in the previous fiscal as they had to intensely compete among themselves and cable TV networks to acquire customers. "There would be a marginal 5 per cent increase in ad spend this fiscal. This is because there was high ad spending in the last fiscal," says a senior official of a leading DTH company.

DTH companies are the top ad spenders on television in the ‘services category‘ with a combined 32 per cent share, according to Tam AdEx data for the first half of the calendar year based on volumes.

The ad volume spend by the DTH sector in the first half of 2010 is up 10 per cent over the year-ago period. In the six-month period to June-end 2009, the DTH segment had a 29 per cent share in the overall ‘services‘ category.

Tam AdEx data shows that ‘properties/real estates‘ had a 15 per cent share in the ‘services‘ category, while ‘Internet service-general‘ follows at third place with an 11 per cent share.

Sun Direct has edged out Tata Sky to become the leading advertiser among the DTH brands with an eight per cent share in ad volumes, according to Tam AdEx data for the first half of 2010. While Tata Sky stands second in the list with a six per cent share (same as previous year), Dish TV, Airtel Digital TV and Reliance Big TV follow with shares of five, four and three per cent of the overall service sector ad volumes on TV.

"The ad volume growth on TV will not reflect Sun Direct‘s position as the lead ad spender. Sun uses its own channels and a sizeable part of its advertising is in the south. Tata Sky will continue to lead in ad spends," says a media analyst.

The rise in ad volumes is driven by three factors - entry of a sixth player (Videocon d2h), increase in the number of new product launches, and a busy sporting events year.
Says Bharti Airtel CMO - DTH Sugato Banerji, "With the IPL and the Fifa World Cup standing back-to-back, the sector eagerly spent on TV for advertising their brands. Now with the festive season and the Commonwealth games coming up, buying commercials on TV from this category is only going to increase."

Dish TV will be increasing its ad spend in the southern states as it hopes to improve its subscriber base in the region. Says Dish TV chief operating officer Salil Kapoor, "We plan to reallocate funds towards south with a larger share of media spends to attract more subscribers from this region."

Bharti Airtel, also looking at attracting more subscribers from the region, has just launched a south-specific "lifetime free language pack" campaign across the Tamil, Telugu and Malayalam channels.

"In the Southern market, language polarity is very high and since we have a weaker marker share in this region, we aim to expand our brand awareness through this campaign," says Banerji.

Big TV will concentrate on BTL and town-wise promotions while continuing to heavily use TV and print. Says Big TV CEO Sanjay Behl, "DTH is still an underdeveloped and low penetration category. We need to raise our ad voice."

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