tata sky launched in india

When Tata Sky launched in the first week of August last year, DTH services had already been in India for a little over two years, yet, less than 35% of the targeted audience even knew what DTH was. Consequently, some of the most challenging tasks that lay ahead of Tata Sky were to create consumer awareness about the brand and educate the target audience use and benefits of the service. The company launched its 360 advertising campaign. Its first teaser TV commercial featured a janitor sweeping away objects like cds, mp3 players, DVD players, etc. which people were throwing out of the window. This was to communicate the message of Tata Sky being a one-stop shop for complete home entertainment making other mediums redundant. The television campaign was supplemented by aggressive outdoor, radio and internet advertising. Within the first week of launch itself, the Tata Sky website recorded a total of 17.5 million hits. Still, as DTH is still a relatively new category and most people were hesitant to experiment with it. While Indian consumers were not completely satisfied with their cable services, they did not feel the need to switch over to any other means of entertainment. It was therefore imperative for Tata Sky to educate the consumers about the advantages of the service and in turn create an urge to invest in it. To counter this, Tata Sky arranged to demonstrate its service in high traffic areas like airports, shopping malls etc. pan India. This provided consumers with the opportunity to experience the service first hand.

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Now, that the consumers were aware and interested in the service, optimal distribution was the key to success. Within the first two months of launch, Tata Sky was being retailed from over 3600 towns with a network of 20,000 dealers. To strengthen its distribution efforts, Tata Sky partnered with the ITC International Business Division and Indian Oil Corporation outlets across the country, to retail its hardware. In addition, Tata Skys hardware was also made available at leading consumer electronic stores in all cities. To enhance consumer convenience, Tata Sky introduced free home delivery of its service, this was the first-of-its-kind initiative taken by any company within this category. Up to this point, Tata Sky concentrated most of its efforts on communicating the basic plus points of its service. It was now time for the company to launch featurefocused advertising. First in line was the Active Sports campaign which highlighted how consumers could enjoy the experience of watching a match in a stadium, from the comfort of their homes. The ads tempted consumers to purchase Tata Sky so that they could watch a match through multiple camera angles, choose the language of commentary and call for player statistics on-demand. The present ads focus on educational yet entertaining television-based service for children. Apart from advertising, Tata Sky also launched a school contact programme. Through this initiative, the company personally went to pre-schools in several cities, to communicate to parents and teachers alike how an educational service like Actve Wizkids would continue a childs learning process at home.Tata Sky also launched customer service measures through engineers providing demo in consumer homes and call centre associates answering customer queries. As a result of above marketing and promotional efforts the company already has a subscriber base of over 3,00,000 subscribers. Company officials say that the company is well on its way to achieving the one million mark by the end of its first year of operation. Today, the companys strong brand pull and positive word -ofmouth from customers is creating entry barriers for potential players in the market. Especially in CAS markets, Tata Sky has been met with an overwhelming response. Call centres have logged in over 25000 calls each day and the company today dominates a 35-40% share in the CAS markets. As DTH is still to prove its superiority over CAS, Tata Sky will need to step its customer education efforts for the same. With other companies like Reliance and Sun TV among others looking at entering the DTH category, the competition will heat up further. The main challenges for the company remain reinforcing greater customer care initiatives and retaining market lead. Eventually, the company will 18

need to upgrade customer service portfolio and introduce innovative products to provide customers more value for money. Television garners the biggest pie in the Entertainment & Media area in India at present and is likely to remain so in the foreseeable future. However, what is changing is the revenue model, which is likely to be more subscription led rather than advertisement led in the future. That is one of the reasons DTH, as a distribution mode is considered as important in India. While in many countries DTH is considered as a niche-television service with exclusive content, in India it is seeming to take on a look of a general platform specially with mandatory sharing content regulations. DTH along with CAS therefore is being looked at as a model which would shape the future revenue model to the subscription centric one from the advertisement led one today. Star TV, though one of the earliest to think about DTH, was not the first to launch its service in India due to regulatory and other hold-ups. It finally launched the Tata sky service late last year in collaboration with the TATA Group. By the time they launched, their competitor Zee was already there with DISH TV (having almost half a million subscribers), CAS was on the anvil and rules required mandatory sharing of content clearly, which was not a very conducive environment for a new launch. Tata Sky has done a commendable job therefore, with its advertising strategy to not only overcome some of the obstacles it faced but also to put DTH as a very viable alternative to CAS as a superior, technology driven distribution platform at nearly the same cost. The results in the short run have been spectacular with Tata Sky looking to clock one million subscribers barely in the first year itself. Having said that, Tata Sky is likely to face a number of challenges going forward. These could be in terms of greater competition from cable operators and MSO who have their feet on the ground for their service offerings. Further, their quality is likely to be as good and with more channel choices and On Demand options available. DTH operators are still not offering the on demand option due to technology constraints. Further, within DTH itself the competition is likely to grow with some large players like Reliance & Sun waiting to join the fray. DTH to succeed in general will have to develop exclusive content which has been its chief differentiator in other countries. Entry into any market is very easy. But to sustain, what one needs to know is the strategy and capabilities to come out of the Chakravyuha. Marketplace is littered 19

with the examples of Abhimanyus who entered the market and fought for some time, but did not know how to survive and get out of the competitive Chakravyuha. You do not learn this when you are facing the competition, you have to be born with this skill. A company, thus, has to build this strategy of survival and growth in its launch plan. Survival with profit or sustainability is the key. The study of TATA Sky so far is the story of a gallant Abhmanyu. It has entered the market by taking on its competitors with aggressive penetration strategy. The foundations of such a strategy include (a) an aware and ready market, (b) proven or desired value proposition, (c) distinctive positioning, (d) strong competitors and (e) a business model that is scale dependent, so that quick scaling gives profitability much higher than smaller players. TATA Sky model has each one of them, except a distinctive positioning. How does a customer assess the difference between the suppliers? And when the difference is marginal, an aggressive penetration strategy gives success that is short-lived. In the current system, due to the initial investment involved the customer gets locked-in. It would mean that very quickly a large locked customer base has been created. The pressure of growth generally takes the attention away from customer satisfaction. Everyone would be concerned about acquiring customers instead of retaining them. The most important and perhaps the only item that gets reported in the MIS or asked by the top management in such a situation is the number of customers enrolled and the cities and areas covered. The performance is measured in terms market share and everyone is happy noting the high share earned. Tata Sky would have to focus on consolidating the customer base. Retention , especially in the case of locked-in customers is based on the consistent delivery of experience customer. In the absence of a good retention strategy, the company would be laden with trapped customers who would not only be looking for other options, but also bad mouth the company. This would prove suicidal when future competitors inevitably play the price game.

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