ZEEL devises 5-year growth map with focus on digital, TV & movie production

In India, content consumption has been in a secular growth phase across platforms and the same is likely to continue, said ZEEL MD & CEO Punit Goenka during the Q3 FY21 earnings conference call

e4m by exchange4media Staff
Updated: Feb 12, 2021 9:08 AM

Media conglomerate ZEEL will increase its investments across digital, television, and movie production businesses as part of its five-year growth map that was finalised following internal deliberations. The company has also set targets for its key business units for the next five years.

"Over the past six months, we have been consistently working to devise a 5-year growth map for the company. After a rigorous exercise and internal deliberations, we have set internal targets, in terms of the time and entertainment share that we as a company must garner in the next 5 years. To achieve these targets, there would certainly be a substantial increase in our investments across digital, television, and movie production businesses," ZEEL MD & CEO Punit Goenka said during the Q3 FY21 earnings conference call.

Goenka noted that content consumption witnessed a sharp spike during the lockdown. This reinstated the fact that content is an indispensable part of an individual's daily life. "In India, content consumption has been in a secular growth phase across platforms and the same is likely to continue."

He also believes that the current digital consumption has only scratched the tip of the iceberg and there is an immense potential for the total addressable market to grow multi-fold. Television, he noted, continues to be the biggest entertainment medium. "The sheer fact that over 100 million households are yet to buy their first television sets speaks a lot about the potential and growth prospects of this industry."

ZEEL's ambition is to garner a dominant share by capitalising on this growth opportunity which is going to unfold over the next decade. "As you all might have noted, while articulating the ZEE 4.0 strategic approach, I had spoken about ‘growth’ being one of the key pillars of this new journey," he stated.

Goenka elaborated further on each of the three business verticals.

For ZEE5, the ambition is to build it into a leading OTT platform for India and South Asian diaspora across the globe. "Much like our broadcast business, we will be following a multi-lingual approach, ramping up the original content production across languages. As more and more viewers join us on the digital platforms, it would be imperative for us to raise our investments in order to cater to their unique tastes and preferences. The expansion in the content offering will be supported by parallel investments in marketing and technology, to improvise the overall consumer experience."

As far as the broadcast business is concerned, Goenka said that the aim is to consistently be India’s number 1 entertainment network. "As you all must have noted, we have already added six new channels to our network over the past 14 months. While the expansion for the linear business is almost complete, we might still see a few launches in the coming years. The viewership of our network has seen some decline over the last one year and to gain back the leadership, we plan to enhance our spends in the Hindi speaking markets as well as few regional language markets."

The company is also bullish on the movie business which has been an integral part of its growth story. "We re-entered the movie production business a few years ago, with an objective to develop a profitable and scalable model. Like any content business, even we had our share of success and failure; but that said, on an aggregate basis, the performance has been satisfactory. We now plan to increase our annual movie releases to 35-40 across six languages, from the current number of 8-12 releases a year. This would also have a flywheel effect for our digital, broadcast, and music businesses."

Goenka revealed that the company's investments in content would see a hike in FY22. He also said that the company's business plans for FY22 would be finalised during Q4. "This phase would be somewhat similar to what we experienced around a decade ago, wherein our investments in regional markets did temporarily impact our EBITDA margins, but at the same time, it also enabled us to grow ahead of the market for many years. The investment decision will have an impact on our margins, working capital, and cash generation. Our business plan for the coming year would be finalised during Q4 and we would provide granular guidance on these line items, during the fourth quarter investor dialogue."

Speaking about the Q3 results, Goenka said that the business returned to near normalcy in the third quarter led by a strong resurgence in consumer demand across categories. "Advertising witnessed a sharp rebound as the sale of products across all categories saw a strong recovery. With the lockdown easing across the country, people began to spend more time out of their homes leading to the normalization of TV viewership to pre-COVID levels. While the movie genre had gained massively during the first half, the category suffered some fatigue due to lack of new content and saw a drop in the viewership share which benefitted the GEC genre."

During the quarter, the company maintained an all-India viewership share of 18.2% and continued to be India’s #2 TV entertainment network. It also continued with its strategy of diversifying content offering for the consumers and going deeper into regional markets with the launch of two channels – Zee Zest and Zee Vajwa. While Zee Zest is a lifestyle channel, Zee Vajwa brings the best of Marathi music.

"With this, we have introduced six new channels in the market over the last 14 months, significantly bolstering our offering to the consumers. All of our new channels have started on a strong footing and will continue to strengthen our network share going forward. During the quarter Zee TV, Zee Bangla, and Zee Keralam improved their respective viewership shares and the Hindi movie cluster maintained its number one position. However, we lost leadership in Marathi, one of our traditionally strong markets. We are working towards fixing the gaps which we have identified in our content offering and we hope to see the results of the same in the next couple of quarters," he noted.

Commenting about ZEE5, he said that the platform’s global MAUs and DAUs for the month of December as per the company's internal data analytics were 65.9 million and 5.4 million respectively. The revenue and EBITDA loss of ZEE5 for the quarter was Rs. 1.2 billion and Rs. 1.8 billion respectively. "During the quarter, ZEE5 released 20 original shows and movies. With close to 200 original shows released since launch, ZEE5 now has the biggest library of Indian original content which will help in ramping up the paid subscriber base, as we go forward. ZEE5 also released 7 movies on our pay-per-view platform - ZeePlex, which enabled consumers to watch some of the new movies from the comfort of their homes."

Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)

For more updates, be socially connected with us on
WhatsApp, Instagram, LinkedIn, Twitter, Facebook & Youtube