Soon after the institution of a new ad sales structure, Zee Telefilms has announced the decision to instate a new rate card beginning April 3, 2006, which will see a rate hike across channels. Given NDTV’s decision to also embark on a similar route for the new fiscal, channel selling and buying is finding more than their usual share of news space.
Joy Chakraborthy, EVP, Head, Network Sales, informed that the rates across the channels in the Network would be increased in the margin of 20-40 per cent, where the likes of Zee TV and Zee Cinema will see a 30 per cent increase. Speaking on the reasons behind the decision, Chakraborthy said, “Many. On the overall media scene, everything about the media environment is changing. There is 10 per cent growth in GDP, inflation in media, sales are increasing and the entire ad pie has increased.”
Enumerating more reasons, he said, “The NRS has reported a phenomenal increase in the C&S households to 61 million and, in my view, if the statistic of 10 million TV sets being sold every year is anything to go by, then there is further increase in that. Also, we mustn’t forget that the DTH homes aren’t even factored in the reported numbers – really there are too many reasons why it was important to re-look our ad rates.”
Chakraborthy also drew attention to the fact that Zee Telefilms performance in the recent past has allowed the decision of rate increase. He said, “All our channels are doing well. Zee TV has become the clear No. 2 player, Zee Cinema and Zee Marathi are reigning in their respective leadership position and Zee Bangla is being revamped with coming West Bengal elections.”
“While Zee Trendz and Zee Smile have been unique initiatives in their space, Zee Café is looking good with the new programming initiatives we have taken of introducing original Indian English content on the channel. Zee Studio has also got some good and unique titles in the year. In all, the Network has gone through a transition phase and the timing of rate hike couldn’t have been better,” he said.
It may be noted that in the last fiscal, Zee had increased its rates marginally, in all but four occasions. “Yes that is true,” said Chakraborthy, adding, “But we still feel we are under-priced and with this increase, we are making a statement.”
According to Chakraborthy, Zee is in the process of rationalising its airtime inventory with increase in content and is also rationalising rates of the channel, which, according to him, had so far been ‘understated’. “The Zee network brings many strengths to the table, and one of the first on that is the all India presence that the channel has. There is no market where you wouldn’t get the Zee channels,” he maintained.
He also pointed to the fact that the purchase power of people had increased and at the end of the day that had increased the opportunities for various advertisers, who were keen to look at various mediums to reach the people. “The demand for the channel has increased and when we try and balance the demand-supply function now, we realised the innate need to increase the ad rates,” said Chakraborthy.
Regarding the expected market reaction, he said, “Many advertisers, whom we have spoken to of the intention to increase rates, have already acknowledged the improvement in our performance and have been positive about the decision.”