‘Both ad, subs rev of Viacom18’s regional cluster has grown at 30%’
For media conglomerate Viacom18, the regional cluster is a key part of its portfolio. The regional cluster’s importance can be gauged from the fact that it contributes 22% to the company’s revenues. The company’s aim is to increase the regional cluster’s contribution to 50%.
The plan to reach that involves growing further in existing markets and also looking at whitespaces. Gujarat is a market where the company sees a lot of whitespace for growing the consumption of local content. It has launched its second channel in the market with Colors Gujarati Cinema.
TelevisionPost.com’s Ashwin Pinto caught up with Viacom18 head regional TV network Ravish Kumar to discuss the company’s regional TV business. During the interview, Kumar spoke about growing regional’s revenue contribution to the network, the impact of NTO, the ad scene and the opportunities in the space.
Right now 22% of Viacom18’s revenue comes from regional. Your aim is to grow the contribution to 50%. What is the game plan to reach there?
The game plan is two-fold. One is to do much better in the markets that we are already in and grow our share. The other is to enter whitespace markets where we are not present in. It will be an equal mix of both. Our focus continues to be on the six markets that we are present in – Kannada, Tamil, Bangla, Marathi, Gujarati, and Oriya. The whitespace markets we constantly continue to look at and evaluate.
How is the regional portfolio faring post the new tariff order (NTO)?
It has been fairly stable. We have seen distribution fluxes and swings in some markets. A lot of this depends on the backend and the situation is not unique to us. Across the board in a few markets, we have seen the reach fall. Everyone has experienced the same thing. A lot of it does not come down to how strong or weak a channel is. It is about the backend and how ready it was to actually implement the NTO. As systems fall in line the disruptions start to go away.
By when do you see things stabilising?
It depends from operator to operator. We have already seen a lot happen over the past four months. I see the dust settling in another three to four months. A new reality will emerge.
To what extent did the regional TV ad pie get affected by the NTO?
It is hard to answer that. This has been an industry-wide issue. There was a freeze period by BARC as well. This affected all genres equally not just regional. Normally the yearend is when advertisers tend to consolidate their spends for the year.
Viacom18’s regional portfolio you said has seen a 30% annual revenue growth. Is this being ad or subscription driven?
Both these streams have grown at roughly the same rate. They have contributed equally. You drive ad revenues up by growing viewership through strong content. This attracts advertisers and brands that are continuing to make in-roads in regional markets.
Ad rates for regional are much less than a Hindi. How do you plan to bridge the gap?
There is no need to bridge any gap. Your cost of production is also much lower. You are not trying to equalise your rates with Hindi. Relative to the viewership share your rates are where they need to be. But yes there is a finite gap on the amount that you can charge. We are very cognisant of that and we tend to do our shows very cost-effectively.
Companies like Amagi offer targeted ad solutions. How important is it?
We already have Amagi and offer it in a few markets like Marathi and Kannada. It allows for less wastage and allows you to push different products or campaigns across different geographies. While you may think of India as one market within that there are differences. Different pack sizes can sell. Different products can sell. A lot of brands are created specifically for geography like Santoor Soap which is locally driven or regionally strong.
Are you looking at more channel launches this year?
We will look at them. But the growth strategy will be a mix of expanding in the markets that we are already present in and entering new markets that we are not present in.
Besides entertainment and movies do you see the potential for other genres in regional?
These two genres are our favourites. We will continue to focus on them. Sport comes sporadically and then goes. But I foresee entertainment and movies continuing to have the lion’s share of viewership in any market.
Are you relooking at certain markets?
No! We continue to be committed to the markets in which we are in. Our thinking is long term. We don’t do short term knee jerk reactions. Right now there is only a partial picture. While we have seen some drop in reach this has not been unique to our network. Every network is facing the same issues.
Since you now have to directly reach consumers has it required a change in Viacom18’s mindset?
We were anyway investing a lot in marketing directly to the viewer. We have always believed in putting outstanding content out there. They create channel demand. There is no need for a mindset change. We will continue to drive content. We will continue to market content very innovatively. The only added piece is that the role of the multi system operator (MSO) and local cable operator (LCO) has become more important with the NTO. A lot of focus will happen on that end rather than taking it for granted. We will devote more time and attention to them.
What is the sort of initiatives being done with distribution partners to ensure that your channels are preferred by consumers?
Every broadcaster is doing a lot on the ground. Efforts include MSO/LCO meets, dialing up their involvement in events that we do on a local level. It has been a combination of ground-level activation and events and reaching out directly to the MSOs, staff, and viewers in a particular locality. Promotions have become a lot more localised. Then on a regional or on a state level, we do a lot more distribution meets than earlier.
Kannada and Marathi are your two biggest markets. How are you building on your position here?
If you look at the kind of programming that we are doing we just launched ‘Bigg Boss’ on Colors Marathi on Sunday. We just launched ‘Laxmi Narayan’ on Monday which is a new show. We do movie premieres and we also do events. In short, our content continues to reinvent itself. We are very aggressive in terms of new launches in both these markets. We do everything we can to get the viewer.
In Kannada, we have three platforms. So between Colors Kannada, Colors Super and Colors Kannada Cinema, we do movie premieres. We are about to launch Kaun Banega Crorepati (KBC) in Karnataka. We will launch a comedy show on the weekends. A whole lot is going on.
Last year, Colors Super underwent a rebranding exercise. How has the response been?
We had launched it relatively recently. We continue to grow that business. I think that it has grown tremendously. It is now the number five GEC in the market and is very close to Star Suvarna. We are giving them a run for their money. So rather than just being an offshoot of a large parent channel, it has become a mainstream GEC.
What progress has Colors Tamil made since launching last year in a very competitive market?
Colors Tamil has seen probably the fastest and highest growth that any new entrant has seen in that market in the last 10 years or so. We were off to a great start and now with our new slate of shows and the expansion of programming hours we hope to take it up even further.
Could you talk about the content expansion strategy in the regional space?
This varies from market to market. In a few markets, we are adding the number of hours of programming. In other markets, we make the weekends stronger and add religious slots in the morning. New market expansion is an on-going process.
Colors Tamil has expanded from 2.5 hours to three hours a day to four hours now which is almost at par with what anyone else is doing. Over the weekend, we continue to invest heavily in non-fiction through our reality shows.
What is the upside that you see from Gujarat?
The upside from Gujarat is actually the viewership growth that will come from people watching the movie channel. It is a first of its kind and it has not been done in that market.
How big a challenge is it to wean them away from their tradition of watching Hindi language channels?
It is a significant challenge. Other markets have taken years to do it. In Bangla and Marathi, it took like a good four to five years. You need a concerted push to up the level of regional content before viewer switching happens. It happens gradually over time and Gujarat is no exception.
How much research did you put in for the movie channel?
A movie channel in Gujarat was a logical fallout given the viewership numbers. We have been doing research to find out who a Gujarati consumer is. They take a lot of pride in who they are and in their cultural identity. The regional print is strong in that market. Our channel Colors Gujarati is doing so well. This gave us an appetite for launching a movie channel.
Do dubbed movies work in regional markets?
It depends. South Indian dubs work very well in Hindi. We are experimenting with Hollywood dubbed movies in Tamil and Bangla. The early indications are that they are working well but again the data points are very limited. My philosophy is that if it is outstanding content with great production values then there is no reason why it will not work.
What marketing initiatives are being done to push the new movie channel?
The marketing campaign is massive. We are spending more than Rs. 2.5 crores and we will run ads on our own platform and other channels. It will also be supplemented by print and we will have full page jackets on the day of launch on 1st June across the two leading newspapers in Gujarat. We will follow it up a week later with more ads as a reminder for consumers. In addition, we have a lot of spots on the radio. We have a massive OOH campaign. We are doing digital as well. The plan is to hit the consumers every which way.
Are movie acquisition prices a challenge across the regional space?
It is always a challenge especially with OTT coming in. Digital platforms drive demand. The market is very robust and the movie pricing reflects that. Knowing what the right price is to pay is a million dollar question. That last price paid for a similar movie becomes the benchmark for a subsequent acquisition.
The value is only as much as what someone else is willing to pay for it. It is not an exact science. In certain markets, prices have gone up but in other markets, it has come down. It is a balanced picture across the board. Pricing is a function of the number of players out there and how well the film has fared at the box office. If a commercial film with big stars does not rate anymore then obviously the demand for it starts to shrink.
When you look at content consumption patterns across regional markets what are the similarities and are there major differences?
Good content works similarly across markets. The same show can be remade with very little modifications. It can work as brilliantly in one market as others. The differences include content relatability. It is not just about the same show working. It has to be cast in an environment that is familiar to viewers. Obviously, the holy grail continues to be taking a show beyond regional markets. That is what we are working towards.
If a Turkish drama or a South Korean soap can work brilliantly in India why shouldn’t regional content go beyond the boundaries of India? For this, we need to continue dialing up content in a way that the stories are universal. Right now, we have been making stories that are very regional rooted. So the relatability outside certain geographies is low. How do you work on emotions that are universal? While the setting can be contextual it has to be contemporary and appeal across the board.
Are tentpole properties growing in importance for the regional cluster?
We have always done tentpoles and so I would not say that they are growing in importance. We always have them as a cornerstone of our weekend programming strategy. We will continue to do that.
Is BARC satisfactory?
Yes! We are happy with it. We don’t see BARC measurement being contrary to our expectations or being contrary to the kind of content that we are putting out there or being contrary to the trends being seen on digital as well on our own platform Voot. They all work in sync.