The launch of MSM’s Sony PAL marks yet another entrance of a new channel in the Hindi GEC segment. ZEEL has launched Zindagi recently. We find out what goes into the decision of launching a new channel.
Reasons for the launch of new channels
One of the key reasons for the launch of new channels, especially by Hindi GECs, is the limited inventory due to the 10+2 cap. Hiking up the rates to unreasonably high levels will deter advertisers from coming in.
According to Mayank Shah, Dy. Marketing Manager, Parle Products the best way to increase inventory is come up with new channels. "Now there are two different kinds of new channels which are coming out. One is where you do not have any programming costs. For example Zee Anmol, Rishtey or Star Utsav, are channels where you don't have any programming costs. You just have repeats (episodes) being played and they typically keep it a FTA (free to air) channel. So you have a separate segment of semi urban rural kind of setup where people would be not conducive to paying monthly rentals for top channels or first line GECs. Second model is you attempt to make more GECs like Life OK or Zindagi or PAL where you have original programming and in that way you try to increase the pie," explains Shah.
Speaking about the strategy of the launch of their new channel Sony PAL, NP Singh, CEO, MSM said, "We are following a market segmentation strategy. If we put the three together (Sony Entertainment Television, SAB TV, Sony PAL) we will appeal as a network therefore as a Hindi GEC network to the entire cross section of the Hindi GEC universe. Wherever they are, whichever geography they are in, whatever psychographics they have, our network will appeal to advertisers."
Another reason why channels are launched is the gap that networks see in attracting specific type of brands to the targeted audiences. Priyanka Dutta, Business Head, Zindagi said, "The channel has been successful in creating a category which is a premium mass category. One very clear thing that used to come out is the latent need that every client wanted for their premium brands was that they didn’t have any platform in the Hindi GEC space which would give them immediate reach to place their brands. So they had to look at English niche channels. This (channel) is somewhere falling in that category. It addresses progressive mindsets unlike the Hindi GECs which have a traditional mindset. It is a premium mass category, so you will have a lot of premium brands attracted here."
Raj Nayak, CEO, Colors said, "We haven't much looked at Rishtey as a second GEC as much as we launched the channel with the intent that people who haven't sampled out content launched six years ago get an opportunity to sample it. And also it gives as an opportunity to experiment a few things which we probably may not be able to do on Colors. You will see Rishtey evolving over a period of time, give it some time."
Are brands optimistic on new channels?
Giving a brand perspective, Shah says the introduction of new channels is good as well as bad for brands. "For brands it is not good is because of the fragmentation of viewership. Earlier GECs were limited and brands would probably take two of them to cover a sizable audience. Now with more GECs coming in it is to be assumed that they are taking something from the same pie. It is not like the pie is increasing. It is more fragmentation so brands will have to put more money. While there can be some competition internally and hence rates can cool down but that could also happen because of the decrease in viewership. But those brands which probably could not afford a Star Plus or Colors because of limited inventory and they hiking the rates, they now have an option and will look at it," he said.
Deepali Naair, CMO, Mahindra Holidays says, "If you are delivering fragmented audience to me I will look at contextual programming which is relevant to my category, second I will look at the mood's relevance to my category and third I will look at the numbers (ratings), and in no particular order."
Sanjay Chitkara, Sales & Marketing Head, LG Electronics, however says that such new channels will obviously help selective targeting by identifying the right target audience and selecting the right channel to carry the brand. He however felt that these channels are still in the initial stages and are yet to see how they do.
Providing their experience of how they received brand support from the start in the Hindi movie space Ruchir Tiwari, Deputy Business Head, Hindi Movie Channels (&pictures, Zee Cinema, Zee Classic) ZEEL said, "They (brands) take the opportunity of (advertising on) new channels. In fact &pictures had value partners before the launch of the channel and that was our unique selling proposition. Advertisers know the game and they are excited for something new. For &pictures we had good support."
Given the various reasons for the launches of new channels, the general sentiment seems to convey that the pros outweigh the cons on the terms of monetization for the network. The main focus lies on creating more inventory and this seems the best option for networks yet.