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The Hindi general entertainment space isn't a homogenous world at all. The classification is stereotyped, not according to the sub-genre of their content but according to the gross rating points (GRPs) garnered each week.
The first category belongs to the elitists - Star Plus, Sony, Zee and Colors - which garner more than 200 GRPs every week. In the second category, there are channels such as SAB TV, Life OK, Imagine, Real and 9X, which average around 100 GRPs every week, while the third group, which houses channels such as Sahara One and STAR Utsav, average at less than 40 points, respectively.
While the third group is completely out of the race and there is little excitement in the market around their products, the 100-GRP category - also called the second rung GECs - have still kept the fire burning. They try to retain the buzz with either interesting programmes or with the big names that head the given channels.
Interestingly, the prognosis of this category has been quite mixed. On the one hand, we have channels backed by big names with heavy investments on programming, which could have made it to the big league but finally failed. 9X, Real and Imagine are interesting examples. On the flip side, there are channels which got a fresh breath of life after several attempts of revamping and repositioning. Take for instance, channels such as SAB and Life OK (earlier STAR One) which have their own set of loyal viewers and have been fairly successful.
So what makes or breaks a channel in this sub-category of second rung GECs? afaqs! explores...
In the media planner circuit, it is said that if a GEC crosses the 200-GRP mark, it's surely done well for itself; and therefore, advertisers are ready to pay a premium. Meanwhile, to even be in the consideration set of the advertisers, a GEC has to stick around the 100-GRP mark. For a channel like Imagine, it could reach the 100-GRP mark only for a few weeks, riding on the high decibel show Rakhi Ka Swayamvar. However, it couldn't sustain the viewership or even build on the buzz once the non-fiction property went off air - and so it slipped.
Apart from the perception, the 100-GRP mark is also important for economic viability.
The cost of production is same for all channels, depending on the quality of programming. However, there is a huge gap in the ad rates commanded by the respective channels. For instance, the top rung GECs claim a rate of Rs 80,000-1,20,000 (per 10 seconds) during prime time, depending on the popularity of the show. But, for a second rung GEC, even the best scoring show will not fetch more than Rs 75,000-80,000 for a 10-second spot.
For channels which score below100 points, the asking rate will be half or even less than what the second rung GECs could ask for.
Now, the crucial deciding factor is the non-prime time rates. Consider this: For, say, Star Plus, Zee TV, Colors and Sony, the non-primetime rates range between Rs 18,000 and10,000, while for channels such as SAB TV and Life Ok, it is anywhere in the range of Rs 13,000-8,000.
Since the deals are mostly signed on the basis of reach versus CPRP ratio, higher the reach, higher is the CPRP. Result? A top Hindi GEC stands tall to demand a high CPRP.
Meanwhile, despite the fact that a second GEC aids marketers to reach out to the critical mass and thus build frequency, its CPRP is almost 30 per cent less than what a top line Hindi GEC commands.
"Now, when it comes to the second line Hindi GECs, Hindi movie channels stand as fierce competitors to this gang. And since it's all a GRP game, the channels have to reach a threshold that is in the range of 100-150 GRPs (the range that a top Hindi movie channel captures) if they are to command a good CPRP that will help sustain their revenue model," says Navin Khemka, managing partner at ZenithOptimedia.
Experts note that channels that are able to sustain themselves in the range of 70-120 GRPs command a CPRP of Rs 10,000 (average estimate) for a 10-second slot.
The two successful second rung GECs, SAB TV and Life Ok, are part of the two large broadcasting networks which have top rung GECs in their respective bouquets. SAB belongs to MSM (Multi Screen Media) and Life Ok is STAR India's second GEC.
Irrespective of their ranks or the slots they fall into, the cost of programming and distribution remains the same. Here, being part of a larger network helps.
Normally, a channel has to spend about Rs 8-12 lakh for 30 minutes of fiction programming. This implies that the channel has to spend Rs 2.4-3.6 crore a week just to complete its prime time programming of four hours. In addition, there are other time slots such as afternoon and weekend.
Here, being part of the network is an advantage because one can bank on the programming library of the network, which would include movies as well as fiction and non-fiction shows. Besides, the parent channels or the networks also share the heavy burden of marketing and distribution costs, which at times are at par or even more than the programming costs.
This is where channels such as SAB or Life OK had an advantage over other contenders such as Real and Imagine. When a channel is independent, to complete 24 hours of programming is a struggle and a failed attempt makes a huge dent to the economy of the channel.
Avinash Pillai, national buying director, Mediacom, says, "For instance, if the network is to acquire a high profile movie at a very high cost, then the offering can be telecast across all its channels including the flagship as well as the second GEC (Star Plus, STAR Gold, Movies OK and Life OK). As a result, monetisation becomes easier."
Besides the content, being part of the network also helps in luring the advertisers.
"Advertisers see more value in group deals as against a standalone owing to higher reach and frequency efficiencies," notes Pawan Jailkhani, chief revenue officer, 9X Media.
Independent channels are unable to package their offerings (with other channels) and therefore have to compromise on rates and deliver disproportionately higher value to advertisers.
Often, being part of the larger network stands for the group's overall ambition rather than individual gains. As Sundeep Nagpal, director, Stratagem Media, says, "The decision by a large broadcaster to launch a second channel has more to do with a network strategy and less to do with its own costs and profitability (which would be a given in any case)."
For instance, when a large network plans to launch a second Hindi GEC, the thought behind it is based on three major objectives:
a) To capture as much viewership share for the network as possible and thereby prevent another competitive network a large chunk of that share.
b) To block bandwidth on the television set as well as strengthen the network's position for negotiation with the MSOs and cable operators
c) To attract smaller advertisers onto a national platform and corner some more share of a brand's ad spends or just offer the smaller channel as a value addition to mega brands.
"Now, the same idea becomes a very costly proposition for a standalone channel and can get chewed till the curtains are down on it," says Sejal Shah, national buying head, Starcom.
Not to forget, the biggest challenge for a standalone channel is also to decide when to turn truly pay (mostly they are registered as pay channels, yet choose not to mandate collections, in order to broad base their reach).
Finding their own niche
SAB TV and now, Life OK have not just survived but also succeeded in their own respective worlds. Both channels have found their niche.
If SAB TV has strongly lived up to its positioning of being a family comedy channel, Life OK is working strongly to establish its core thought - life is not that bad. Experts also agree that both the channels run on much lower production costs when compared to the larger players - and hence no large reality shows or star casts.
The Sahara - Utsav formula
According to industry experts, quite like Zee, Sahara One carries a legacy of its own. Sahara One was launched as Sahara TV in 2000, at a time when only the top gang existed. Now, despite the small numbers, Sahara One still exhibits a strong pull in the deeper pockets of MP and UP.
"Also, Sahara is a cash rich group and the channel is here for the long haul. As for STAR Utsav, it is the only free-to-air channel from the STAR bouquet and reaches out to the rural market like DD. So, many times, it becomes part of a media plan's overall genre combination. Moreover, it runs repeats of Star Plus' old shows; so there is no additional programming cost," says a top media planner on conditions of anonymity.
New channels are always seen as an opportunity by planners and advertisers alike. It is always interesting to see who the challenger would take the viewership share from as it does open up options from a channel choice for a planner. The challenger would either end up expanding the overall viewership base or fragment the viewership further.Major stories over the last 30 days