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MKTG/225

ICMR Center for Management Research

Tata Skys Marketing Strategies


This case was written by Barnali Chakraborty, under the direction of Vivek Gupta, ICMR Center for Management Research
(ICMR). It was compiled from published sources, and is intended to be used as a basis for class discussion rather than to
illustrate either effective or ineffective handling of a management situation.

2009, ICMR. All rights reserved.

To order copies, call 0091-40-2343-0462/63 or write to ICMR, Plot # 49, Nagarjuna Hills, Hyderabad 500 082, India or email
info@icmrindia.org.

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MKTG/225

Tata Skys Marketing Strategies


Tata Sky is leaping ahead to garner eight million connections by 2012. We are the first DTH
company across the globe to achieve the significant milestone of crossing one million connections
in the first year of our operations and are confident of achieving the eight million mark as well.1
- Chakrapani Perangur, CIO, Tata Sky Limited, in January 2009.
Efficient customer service, superior technology and more interactive features are the keys.2
- Vikram Mehra, Chief Marketing Officer, Tata Sky Limited, commenting on the
companys success factors, in June 2009.

INTRODUCTION

In March 2009, Tata Sky Limited (Tata Sky), the India-based Direct to Home (DTH)3 service
provider, announced a special promotional offer for those booking the Tata Nano, the worlds
cheapest car manufactured by Tata Motors Limited. Under the offer, consumers who had already
booked a Tata Nano could get a 20 percent discount on a new Tata Sky connection. To avail of the
benefit, consumers had to submit proof of booking the car. The offer was valid between April 9
and May 14, 2009. Vikram Mehra (Mehra), Chief Marketing Officer, Tata Sky, said, The launch
of Nano is one of the biggest historic events in the auto industry. Now, the customers have a way
to enjoy the benefits of Nano and Tata Sky through a single offer. 4
Launched in August 2006, Tata Sky was one of the leading players in the Indian DTH industry.
Through its DTH service, the company offered more than 170 channels on entertainment, sports,
movies, music, news, etc. along with interactive services through its different channel packages. In
October 2008, Tata Sky launched Tata Sky +, a premium set-top box. Tata Sky+ made it possible
for consumers to record, pause, and also rewind live TV programs.
Tata Sky adopted an aggressive pricing strategy to attract consumers. By offering different channel
packages, it ensured that consumers could choose their favorite channels and pay only for those
they wanted to watch.
Tata Sky also launched several advertisement (ad) campaigns to support its product launch. Along
with television commercials (TVCs), it also laid emphasis on outdoor, radio, and Internet
advertising. The company roped in film personalities to communicate its message. Along with ad
campaigns, it also announced several promotional offers to attract consumers.
With aggressive marketing strategies, Tata Sky was able to cross a subscriber base of one million
within 11 months of its launch. It took another nine months to reach two million customers, and
another seven months to cross three million customers. In June 2009, Vikram Kaushik (Kaushik),
1
Tata Sky: Launching a Major Satellite TV Business with Unprecedented Speed, http://www.01-
ibm.com, January 05, 2009.
2
R. Ravikumar, Direct and Daring, http://www.thehindubusinessline.com, June 11, 2009.
3
Direct to Home (DTH) refers to satellite television broadcasts intended for home reception. Satellite
television is television broadcast delivered by the means of communications satellite and received by a
satellite dish and set-top box (Source: http//en.wikipedia.org).
4
Tata Sky Offers Discount to Nano Buyers, http://business.rediff.com, March 24, 2009.

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Tata Skys Marketing Strategies

Managing Director (MD) and Chief Executive Officer (CEO), Tata Sky, said, We hope to cross
the 4-million mark in the next two months.5

THE INDIAN DTH INDUSTRY

DTH services were introduced in India in the early 2000s. DD Direct Plus, launched in December
2004, was Indias first and only DTH service for which consumers did not have to pay any
subscription charges. DD Direct Plus offered all Doordarsahan (DD)6 channels and several private
FTA (Free-To-Air) channels. In 2005, the Dish TV DTH service offered by the Essel Group7 was
launched. This was followed by the Tata Sky DTH service in August 2006.
As of December 2007, the Indian DTH market had less than five million subscribers among 68
million television (TV) households who had access to cable and satellite television across India.8
In late 2007, the cable operators started demanding exclusive deals on DTH channels. While some
DTH players like Tata Sky were in favor of exclusivity of content, others like Dish TV opposed it.
According to Arun Kumar Kapoor (Kapoor), the then CEO of Dish TV, Exclusivity only helps
operators and they are the ones pushing for it. Exclusive contracts with broadcasters will create
unnecessary rivalry in the market. Operators with exclusive content will then start asking for
premium prices for their service, which will in turn hurt the consumers as they will have to bear
the cost. The differentiator should not be content but the quality of service and innovations.9
From December 01, 2007, the Telecom Regulatory Authority of India (TRAI) imposed a ceiling
on content costs charged by all cable TV services except those in areas which had been notified for
implementation of the Conditional Access System (CAS)10. Broadcasters were required to provide
all channels on an a la carte basis with la carte rates. They could also offer bouquets of channels,
but had to ensure that the sum of la carte rates should not exceed 1.5 times the bouquet rate and
the a la carte rate of each channel cannot be more than three times the average rate of the pay
channel in the bouquet. However, the DTH operators raised concerns over the regulation on
pricing of content. According to Rajesh Sawhney, President, Reliance Entertainment, Pricing of
TV channels and bouquets is a tricky issue and the regulator has to see there is no monopolistic or
restrictive behavior. Interests of the consumer needs to be balanced with the health of broadcasters
as well as platform owners.11

5
R. Ravikumar, Direct and Daring, http://www.thehindubusinessline.com, June 11, 2009.
6
Doordarsahan is the public television broadcaster of India and a division of Prasar Bharati, a public
service broadcaster nominated by the Government of India (Source: http://en.wikipedia.org).
7
Essel Group, founded in 1976, is an Indian business house with diverse business interests in media,
packaging, entertainment, technology-enabled services, infrastructure development, and education
(Source: http://www.esselgroup.com).
8
Ritesh Gupta, DTH Aims for Blue Sky in Booming India, http://www.onscreenasia.com, December 1,
2007.
9
Ritesh Gupta, DTH Aims for Blue Sky in Booming India, http://www.onscreenasia.com, December 1,
2007.
10
A Conditional Access System (CAS) is a system by which electronic transmission of digital media,
especially satellite television signals through cable, is limited to subscribers. (Source:
http://en.wikipedia.org)
11
Ritesh Gupta, DTH Aims for Blue Sky in Booming India, http://www.onscreenasia.com, December 1,
2007.
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Tata Skys Marketing Strategies

December 2007 saw the launch of the SUN Direct DTH Service.12 This was followed by the
launch of the Reliance Big TV DTH Service13 in August 2008 and Airtel Digital TV14 in October
2008. Apart from different channels, the DTH service providers also offered interactive services
and value added services like pay per view movies. In early 2008, Dish TV, Tata Sky, Big TV,
Airtel Digital TV, and SUN Direct together formed the DTH Operators Association of India
(DOAI) (Refer to Table I for DTH Operators in India).
Analysts expected DTH penetration in India to accelerate, driven by the fierce competition
between the DTH players. According to TRAIs report, the subscriber base of the DTH market in
India was at 11.1 million at the end of 2008. According to Salil Kapoor, COO of Dish TV,
between July and September 2008, the industry added an average of 0.6 million subscribers every
month. According to the analysts, the subscriber base as of June 2009 was close to 13.5 million of
which Dish TV had five million subscribers, Tata Sky 3.7 million, and Sun Direct 3.1 million
subscribers.15 The growth in the Indian DTH industry could be credited to the entry of several
DTH operators who had helped create awareness about the DTH service among consumers. The
competition among the DTH players led to a decline in the prices of set top boxes as well as
subscription charges.
Table I
DTH Operators in India
Company Launch Year Subscribers* Channels Technology
Dish TV 2005 4.8 182 MPEG-2
Tata Sky 2006 3.2 160 MPEG-216
SUN Direct 2007 2.3 164 MPEG-417
Big TV 2008 1.5 153 MPEG-4
Airtel Digital TV 2008 0.5 138 MPEG-4
*In Million as on December 2008.
Source: Ajita Sashidhar, Great Expectations, http://www.business.outlookindia.com, March 07, 2009.
According to industry experts, the Indian DTH market had achieved a major percentage of its
growth from urban areas. However, realizing the huge potential of the rural market, the DTH
players later also started focusing on rural markets to increase their subscriber base. While Airtel
Digital TV was working on cost-effective subscription packages to attract consumers in rural
areas, some other DTH players were working on low-cost set-top boxes. According to Jawahar
Goyal, Managing Director, Dish TV, The next wave of growth for DTH companies will come

12
SUN Direct DTH Service is provided by the India-based media agency, SUN Network.
13
Reliance Big TV DTH service was launched by Reliance Communications Limited, a subsidiary of Anil
Dhirubhai Ambani Group.
14
Airtel DTH service was launched by Bharti Airtel.
15
R. Ravikumar, Direct and Daring, http://www.thehindubusinessline.com, June 11, 2009.
16
MPEG-2 is a standard developed by the Moving Pictures Expert Group (MPEG). It is widely used as the
format of digital television signals that are broadcasted by terrestrial (over-the-air), cable, and direct
broadcast satellite TV systems. It also specifies the format of movies and other programs that are
distributed on DVD and similar discs. (Source: http;//en.wikipedia.org).
17
MPEG-4 was introduced in late 1998. MPEG-4 had many of the features of MPEG-1 and MPEG-2 and
other related standards, adding new features such as (extended) VRML support for 3D rendering, object-
oriented composite files (including audio, video and VRML objects), support for externally-specified
Digital Rights Management and various types of interactivity (Source: http;//en.wikipedia.org).
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Tata Skys Marketing Strategies

from smaller cities as well as non C&S homes. We expect to consolidate our market share from the
bottom of pyramid by the 2012.18
With the competition hotting up, some industry experts opined that more than increasing the
subscriber base, the bigger challenge for DTH players was to retain those consumers. They were of
the opinion that with more competition, DTH players would try to attract and retain consumers
with value added services like pay-per-view and interactive services. Along with these, customer
service would also make a big difference among DTH players.
According to some analysts, by 2015, the Indian DTH industry would have a 40 percent share of
the Cable and Satellite (C&S) television market. However, they expressed concern about the return
on investment considering the DTH industry was investment sensitive. They pointed out that all
the DTH players as of mid-2009, continued to face losses, mainly because of the high subsidy
given on set top boxes as well as on subscription charges. According to industry sources, all DTH
players offered an average of 30 per cent subsidy on their set top boxes.
The DTH players also complained that the tax and service fee imposed by the government was
making things worse. They said that around 40 percent of their revenues were spent on paying
taxes and the license fee and another 12 percent went toward the service fee imposed by the
government. In addition, there were entertainment taxes that differed between states. According to
Kaushik, Its a big problem. Take a look at the dynamics of the business. Overall, what happens
is that the revenue model of all DTH players is fundamentally dependent on the subscription that
the consumer pays every month, which is average revenue per user (ARPU). If the ARPU is Rs 75
a month, it will take at least five years to recover the cost of a connection that too, provided the
consumer stays with you and continues to pay every month.19

ABOUT TATA SKY

The history of Tata Sky can be traced back to 2004, when it was incorporated as Space TV, a joint
venture between the Tata Group,20 which had an 80 percent stake, and the STAR network21, which
had a 20 percent stake in the company. Space TV was created to provide the DTH service to
Indian consumers.
On May 17, 2005, Space TV received clearance from the Information and Broadcasting Ministry
of India to launch its Ku band22 DTH service. On November 14, 2005, Space TV changed its name
to Tata Sky Limited (Tata Sky)23 (Refer to Exhibit I for the logo of Tata Sky). It was announced
that the company would market its DTH service under the brand name Tata Sky.

18
Vipin Bajaj, DTH Companies Shift to Rural India for Subscribers, http://www.televisionpoint.com, June
3, 2009.
19
R. Ravikumar, Direct and Daring, http://www.thehindubusinessline.com, June 11, 2009.
20
The Tata Group, a multinational conglomerate based in Mumbai, India, was founded in 1868. It has
interests in steel, automobiles, information technology, communication, power, tea, and hotels.
21
STAR, a wholly-own subsidiary of News Corporation, was founded in 1991. It pioneered satellite
television in Asia. As of 2009, STAR broadcasts over 60 services in 13 languages and offers a
comprehensive choice of entertainment, sports, movies, music, news, and documentaries (Source:
http://www.startv.com).
22
The Ku band is a portion of the electromagnetic spectrum in the microwave range of frequencies. Ku band
is primarily used for satellite communications. It is also used for satellite communications from remote
locations back to a television network studio for editing and broadcasting (Source:
http://en.wikipedia.org).
23
STARs parent company, News Corporation, owned more than one-third of the equity stake in the UK-
based British Sky Broadcasting (BSkyB). BskyB, founded in 1990, operates Sky Digital, a subscription
television service in the UK and Ireland. BSkyB produces TV content and owns several TV channels. As
of June 2009, BSkyB was the UKs largest pay TV provider (Source: http://en.wikipedia.org).
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Tata Skys Marketing Strategies

Tata Sky also signed an agreement with the Indian Space Research Organization (ISRO)24
whereby ISRO would lease all 12 Ku-band transponders25 on the INSAT 4A satellite26. Tata Sky
was to use these transponders to provide its DTH services across India. On January 30, 2006, Tata
Sky announced that it had entered into a partnership with the NDS Group Limited27, the leading
provider of open end-to-end technology solutions for digital pay TV. In February 2006, the
company selected Thomson28 to manufacture set top boxes for it and to provide after sales service
and support network to its consumers. In March 2006, it selected Maxus India, Indias leading
media agency, as its media buying partner. Sun Microsystems, Inc.29 was selected as the provider
of IT Infrastructure solutions and support for the launch of Tata Sky DTH service.
In June 2006, Tata Sky started testing its DTH service in the homes of over 1,000 of its employees
in eight cities. Along with the technology, systems, and installation process, customer service was
also tested for the Interactive Voice Response (IVR) System30. During the testing process, the
company came up against some technology, process, and service related problems. After
successfully addressing those problems, Tata Sky was all set to launch the DTH service in India.
On August 08, 2006, the Tata Sky DTH service was launched across 300 cities in the country.
Along with several channels, Tata Sky DTH service offered four interactive services, including
Active Sports, Active STAR News, Active Newsroom, and Active Khabar. To avail of the
DTH service of Tata Sky, consumers had to install a small 65-cm mini-dish to receive satellite
signals, buy a digicomp, and get prepaid recharge vouchers. At the beginning, the company started
offering its DTH service at an introductory subscription fee of Rs 200/- per month for 50 channels.
Tata Sky also launched a website where all information regarding its products and services, prices
of different products, offers and promotions, and ways to recharge was available (Refer to Exhibit
II for the home page of Tata Skys website).

24
ISRO (Indian Space Research Organization) was launched in 1969 and it has set up established space
systems like the INSAT for telecommunication, television broadcasting, and meteorological services, and
the Indian Remote Sensing Satellites (IRS) for resources monitoring and management (Source:
http://www.tatasky.com).
25
A communications satellites channels are called transponders.
26
The Indian National Satellite (INSAT) system is a joint venture of the Department of Space (DOS),
Department of Telecommunications (DOT), India Meteorological Department (IMD), All India Radio
(AIR) and Doordarshan. It was established in 1983. INSAT-4A, launched in 2005, was the first in the
INSAT-4 series. It carries 12 Ku-band and 12 C-band transponders. The Ku-band transponders primarily
meet the growing demand of DTH.
27
NDS Group Limited, headquartered in Staines, UK, was founded in 1989. It is a private company owned
by the Permira Funds and News Corporation. It creates proven technologies that allow pay-TV operators
to generate revenues by securely delivering digital content to TVs, set-top boxes (STBs), digital video
recorders (DVRs), PCs, portable media players (PMPs), removable media, and other mobile devices
(Source: http://www.nds.com).
28
Thomson, the worlds leading provider of solutions for the creation, management, delivery and access of
content for the Communication, Media & Entertainment industries, was founded in 1893. Through its
Thomson Connect activities, the company supplies satellite, cable, and telecom operators with access and
home networking devices and software platforms (http://www.thomson.net).
29
Sun Microsystems, Inc., headquartered in Santa Clara, California, was founded in 1982. It is a
multinational vendor of computers, computer components, computer software, and information
technology services. On April 20, 2009, Sun and Oracle Corporation announced that they had entered into
a definitive agreement under which Oracle would acquire Sun for US$ 7.4 billion (Source:
http://en.wikipedia.org).
30
Interactive Voice Response (IVR) is an interactive technology that allows a computer to detect voice and
keypad inputs. IVR technology is used extensively in telecommunications, but is also being introduced
into automobile systems for hands-free operation (Source: http://en.wikipedia.org).
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Tata Skys Marketing Strategies

In September 2006, the company launched Showcase, a pay per view (PPV) model, where
viewers could view a movie of their choice by paying an additional Rs 75 per movie, apart from
the subscription fee.
The Tata Sky DTH service was well received by consumers across India. By October 2006, the
company was offering its service through more than 17,000 outlets in 3,700 towns across India.
Commenting on the positive consumer response, Kaushik said, The market has responded
positively to our service and our aim is to have one million subscribers by the end of a year. We
are well on our way to achieving that target.31 On August 08, 2007, Tata Skys subscriber base
reached one million. As of March 19, 2009, Tata Sky had 3.5 million consumers as against the
total 13 million DTH consumers in India.

THE MARKETING MIX

Tata Sky emphasized all the four Ps of marketing i.e. product, price, place, and promotion. The
company made efforts to offer a better product and services at an affordable price. In an effort to
establish its presence across India, the company developed a vast distribution network. It also
adopted a promotional strategy in order to communicate the value proposition of its product and
service offerings to the consumers. The promotional strategy not only included advertising through
television, radio, magazines, newspapers, the Internet, and billboards, but also sales promotion.
PRODUCT AND SERVICES
Tata Sky offered the DTH service based on three Cs i.e. Choice, Control, and Convenience. It
offered consumers a choice of more than 170 channels with DVD picture quality and CD sound
quality. In Tata Skys DTH service, viewers had better control over what they could watch. They
were able to watch different channels simultaneously. Tata Sky also offered convenience to its
consumers by giving a program schedules for all channels, and reminders for favorite programs.
Tata Sky offered interactive services including Active Mall, Active Learning, Active
Cooking, Showcase etc (Refer to Exhibit III for Tata Skys Interactive Services).
Commenting on the interactive services offered by Tata Sky, Mehra said, We have proved that
the television is no longer an idiot box but a wholesome family entertainer with interactive
services for everyone. We have made TV an active medium rather than a passive one.32
The company also offered some other features as part of its DTH service. For example, consumers
could know their subscriber ID, account status, due date for recharge, and the latest
offer/promotion on Tata Sky, by pressing the home button on Tata Sky remotes. Consumers also
had a guide option, with which they could check the list of all television programs for the next
four days, get a summary of all the programs, and set reminders for up to 50 programs they wanted
to watch. The guide option was available both in English and Hindi. Apart from these features,
with Parental Control, consumers could lock movies on the basis of the ratings of movies
provided by the channel.
Consumers could also set up to 20 channels in the order of their preference as a part of their
favorites list. They could press the fav button on Tata Sky remotes to go directly to their favorite
channel. With the help of the Search & Scan Banner, they could find out whats playing on
another channel without changing the channel they were watching. The banner, which appeared at
the base of the TV screen, showed the schedule of all programs.

31
All the Entertainment You Need, http://www.tata.in, January 2007.
32
L.N.Revathy, Tata Sky Bets Big on Interactive Services, http://www.blonnet.com, January 22, 2008.
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Tata Skys Marketing Strategies

Tata Sky offered its consumers a variety of channel packages. Consumer could subscribe to the
Annual Mega Pack which included all the channels and services on Tata Sky (except the Topper
channel33) and 12 Showcase movies. Consumers could also opt for any of the Base Packages such
as the Super Value Pack, Super Jumbo Pack, Super Saver pack, and so on. After subscribing to any
Base Package, consumers could select any or all of the Add On Packages that included the Fun
Learning Pack, the Sports Gold Pack, and the Lifestyle Gold Pack. All the Base packages included
some interactive services (Refer to Exhibit IV to know more about Channel Packages).
On October 14, 2008, Tata Sky launched a new product, Tata Sky+, a premium set top box with a
personal video recorder (PVR). Consumers could record programs, pause a live telecast, and also
rewind TV programs. Tata Sky+ had MPEG 4 technology as compared to the MPEG2 technology
of Tata Sky. During the launch of Tata Sky+, Kaushik said, TATA Sky had revolutionized the
TV viewing experience in India by spearheading the introduction of innovative interactive services
covering cooking, matrimonial classifieds, learning games, and the introduction of its unique bi-
lingual programming guide. This time we chose to capitalize on our partnership with Sky, the
global leader in the DTH technology to bring another first to India, PVR. This technology will not
only help your subscribers to time-shift their TV-viewing with the Record and Playback features,
but also give them the convenience to enjoy uninterrupted TV with the Pause and Rewind live TV
features.34 The company also had a dedicated website for Tata Sky+ (Refer to Exhibit V to
know more about the features of Tata Sky+ and to Exhibit VI for the home page of Tata
Sky+ website).The products and services offered by Tata Sky were supported by dedicated
customer care.
PRICE
In order to avail of the Tata Sky DTH service, consumers had to buy the Tata Sky digicomp. The
DTH service could be activated only after the installation of a dish. To use the Tata Sky DTH
service, consumers had to pay a subscription fee.
As part of its pricing strategy, Tata Sky reduced the price of its digicomp as well as the
subscription fee. Tata Skys digicomp was initially priced at Rs 2,999. In February 2008, Tata Sky
reduced the digicomps price by 50 percent, to Rs 1499. In June 2008, the company also reduced
the subscription fee of different channel packages. For example, the Family Pack was available at
Rs 200 per month instead of the earlier Rs 250. The Super Saver Pack was available at Rs 260 per
month as against the earlier Rs 300.
Tata Sky said it had reduced the price of the digicomp and the subscription fee so as to make its
service more affordable to its consumers. However, Tata Skys claim to have reduced subscription
fees attracted criticism from consumers as well as industry experts. Some analysts termed Tata
Skys price reduction as an aggressive marketing strategy to increase its market share while some
others including its main rival Dish TV termed it as a marketing gimmick to attract consumers.
Analysts pointed out that although Tata Sky claimed that it had reduced the subscription fee, the
subscription fee had actually increased for consumers. They argued that Tata Sky had removed
some important channels from the base packages and put those as separate packages. Therefore, if
consumers wanted to watch the same set of channels they had been watching, they would have to
pay more. For example, they said, even though the company claimed that it had reduced the price
of the Family pack and the Super Saver pack, actually consumers had to pay an additional fee to
watch ESPN, Star Sports, Star Cricket, Ten Sports, and BBC, which were earlier a part of the base
packages. Commenting on the criticism, Mehra said, The whole philosophy is that people who do
not want to pay for a niche channel should not be paying for something they do not want to
watch.35

33
GreyCells18 Media Pvt. Ltd., provider of interactive learning services, launched Topper Channel in
February 2008. Topper Channel is a curriculum based education TV channel. It is a part of Topper
Integrated Learning System, an interactive and integrated educational service.
34
Tata Sky Introduces New High-Tech DTH Service, http://www.domain-b.com, October 14, 2008.
35 Dish-Tata Sky War of Words over New Pricing, http://www.business-standard.com, June 03, 2008.
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Tata Skys Marketing Strategies

For the installation of the dish to receive satellite signals, consumers had to call the Tata Sky
helpline. For standard installation36 of the dish by trained Tata Sky engineers and installation
warranty and activation of the digicomp, consumers had pay Rs 1,000. A 50 percent discount on
the installation charges for the second, third, and fourth digicomp was offered by the company.
For Tata Sky+ digicomp, consumers had to pay Rs. 8,999. Installation charges and monthly
subscription charges were the same as in the case of Tata Sky digicomp. For Tata Sky+ usage fee,
consumer had to pay Rs 50 per month. However, customers who already had the Tata Sky
digicomp and wanted the Tata Sky+ digicomp, could exchange their Tata Sky digicomp for a Tata
Sky+ digicomp in the Grand Tata Sky Exchange Offer.
As per this offer, consumers who had already opted for the Annual Base Pack had to pay Rs. 5,999
for the Tata Sky+ digicomp and standard installation. Consumers who had already opted for the
Annual Mega Pack had to pay Rs 4,999. This offer was for those consumers who had purchased
and activated Tata Sky on or before August 31, 2008.
Consumers had to pay a monthly subscription fee depending on the channel packages they chose.
If consumers chose the Annual Mega Pack, then they had to pay an annual subscription fee of Rs.
5,000. The advantages of choosing the Annual Mega Pack were that even if Tata Sky increased the
rates of any channel package, consumers who had opted for the Annual Mega Pack would get the
channels at the predetermined subscription rate, and if the company introduced any new channel,
that would be automatically included in the package.
Consumers opting for any Base Packages had to pay subscription prices on a monthly, semi-
annual, or annual basis. As of June 2009, the monthly subscription prices ranged between Rs. 125
and Rs. 310. For all add-on packages except a la carte channels, consumers had to pay
subscription prices that started from Rs 15 per month. In the case of a la carte channels,
consumers could choose any one of the available channels to add to their base packages. The
monthly subscription prices for the channels offered in this pack started from Rs 10 (Refer to
Table II for the Subscription Fee for Channel Packages).
Table II
Tata Sky Subscription Fee for Different Channel Packages
Channel Packages Subscription Fee
Base Packages
Super Hit Pack (60 Channels) Annually-Rs. 1,250, Semi Annually-Rs. 625, Monthly-Rs.
125
South Starter Pack (76 Channels) Annually-Rs 1,250, Semi Annually-Rs. 625, Monthly-125
Super Value Pack (99 Channels) Annually-Rs 2,000, Semi Annually-Rs. 1, 000, Monthly-
Rs. 200
Super Saver Pack (124 Channels) Annually-Rs 3, 025, Semi Annually-Rs. 1,550, Monthly-
Rs. 275
South Saver Pack (110 Channels) Annually-Rs 2,600, Semi Annually-Rs 1,300, Monthly-Rs.
260
South Value Pack (96 Channels) Annually-Rs 2,000, Semi Annually- Rs. 1, 000, Monthly-
Rs. 200
South Jumbo Pack (139 Annually-Rs 3,410, Semi Annually-Rs 1,760, Monthly- Rs.
Channels) 310

36
*Standard installation with 15 meter cable length.
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Tata Skys Marketing Strategies

Add On Packages
Fun Learning Pack (5 Channels) Annually-Rs 300, Monthly-Rs 30
Lifestyle Gold Pack (16 Annually-Rs 450, Monthly- Rs. 45
Channels)
Lifestyle Bronza Pack (4 Annually-Rs 150, Monthly- Rs. 15
Channels)
Sports Gold Pack (2 Channels) Monthly- Rs. 40
Sports Platinum Pack (3 Monthly- Rs. 65
Channels)
ESPN & Star Sports Pack (2 Monthly- Rs. 40
Channels)
Sports Bonanza Pack (6 Annually-Rs 1, 350
Channels)
A La Carte Channels Ten Sports-Rs 20/month, STAR cricket-Rs 25/month,
Topper-Rs1,010/annum, Zee Telegu-Rs. 10/month, and Zee
Kannda-Rs. 10/month
Source: http://www.tatasky.com.
To avail of the same base package as opted for the first digicomp, on the second, third, and fourth
digicomp, consumers had to pay only Rs as 125 monthly subscription charges per additional
digicomp. Tata Sky offered four different options for paying the subscription charges payment
via credit card, auto debit, payment via recharge voucher, and Cheque payment. Registered users
of the Tata Sky website could also pay their subscription fees through the companys website.
DISTRIBUTION
Tata Sky had a wide distribution network across the country to sell its digicomps and prepaid
recharge vouchers. Consumers could buy digicomp and prepaid recharge vouchers from the
nearest Tata Sky authorized dealer; they could buy it online, or call the Tata Sky helpline for free
home delivery. The company also ensured that the digicomps and prepaid recharge vouchers were
available at popular consumer electronic stores and mobile phone outlets.
In order to reach the rural consumers, Tata Sky entered into agreements with ITCs e-Choupal,
ITCs International Business Division Godrej Aadhar, and the Indian Oil Corporation. In order to
cater to urban consumers, it had tie-ups with Infiniti Retails Croma, Tata Indicom, and Pantaloon
Retail in big cities in India.
As a result of its efforts in strengthening its distribution network, Tata Sky had 35,000 outlets in
5,000 towns across India as of October 2008. By late 2008, the company started setting up sales
and service dealers (SSDs) across semi-urban and rural markets of India. The SSDs helped the
company to increase its presence in semi-urban and rural markets.
PROMOTION
Tata Sky focused on advertising its DTH services, as the companys own research about the Indian
DTH market indicated that there was a lack of awareness about the service among consumers. To
educate consumers about the DTH service, the company launched a 360 advertising campaign. In
the advertising campaign, the company stressed the benefits of the service, rather than describing
the complex technical specifications of DTH.

9
Tata Skys Marketing Strategies

The first TVC aired by Tata Sky in mid-2006, featured a doorkeeper sweeping away CDs, MP3
players, DVD players, etc. which people had thrown out of their houses. The message in the ad
was that with Tata Sky, consumers would not require any other medium for home entertainment.
The TVC was supported by outdoor, radio, and Internet advertising. Within the first week of the
launch of the Tata Sky DTH service, the companys website recorded about 17.5 million hits.
In an effort to educate consumers about the comparative benefits of the DTH service over digital
cable, Tata Sky displayed its service at airports, railway stations, shopping malls, etc. across India.
This demonstrating strategy not only helped consumers to experience the service before buying it
but also helped the company to promote its service.
To communicate the services offered by Tata Sky, the company started airing TVCs specific to the
services. One such TVC showed how consumers could experience watching a match in a stadium
with Tata Sky DTH service. Another TVC showed how Tata Sky offered educational programs for
children. To communicate the educational programs offered by it, Tata Sky launched a school
contact program. In this program, representatives from the company went to pre-schools in several
cities to communicate how Tata Skys Active Wiz helped children to continue their learning at
home.
In March 2007, Tata Sky announced a promotional offer in which consumers who bought Tata Sky
before April 15, 2007, would get three months of free subscription of the channel packages that
they chose on up to four digicomps. Apart from that, 50 subscribers along with their families
would get to watch the final match of the ICC World Cup 2007 with the leading Hindi film actor
Hrithik Roshan.
In September 2007, during the ICC World Twenty 2037, Tata Sky launched an interactive game
quiz in which Mahendra Singh Dhoni, Captain of Indias Cricket Team, was involved. The
company also launched an interactive cooking program.
In July 2008, Tata Sky signed on another popular Hindi film actor, Amir Khan (Khan), as its brand
ambassador. Tata Sky launched three different ad campaigns with Khan. In the first TVC, Khan
played the dual role of a husband and a wife. The ad showed a Punjabi husband and wife arguing
about their favorite DTH operator. Later, they realized that both of them were talking about the
same operator. The message of the TVC was that by subscribing to Tata Skys DTH service,
consumers would get the brand name of the TATA Group, one of the most trusted corporate
houses in India, and global DTH technology from BSkyB.
The second TVC featuring Khan was created for the promotion of Tata Sky+. In the ad, he played
a role of a husband who tried to please his wife so that she would give him the remote control of
the television to watch the cricket match. Through this TVC, the company wanted to convey the
message that with its new product Tata Sky+, there was no need to sacrifice one TV program for
another, because viewers could record, pause, and rewind TV programs.
The third TVC focused on the superior picture quality that viewers could experience by installing
Tata Sky. The ad showed an elderly man driving his car and expressing disgust that cricket had
become an obsession in India, and that with Tata Skys superior picture quality his son has become
addicted to it. He was angry that while he had to stand in a queue in the scorching heat to pay the
electricity bill, his son was enjoying cricket on Tata Sky. To teach his son a lesson he handed over
his Tata Sky set top box to a stranger. When he gets home, his son tells him that their Tata Sky set
top box had been stolen. The ad ended with the elderly mans reply that with a product like Tata
Sky, it was inevitable. However, this TVC attracted some criticism, as Tata Sky emphasized
superior picture quality, an obvious advantage of a DTH service. According to Sujay Nanavati,

37
The ICC World Twenty20 is the international championship of Twenty20 cricket. The game involves two
teams, each having to play a single innings, batting for a maximum of 20 overs. The first ICC World
Twenty20 was held in South Africa in 2007. (Source: http;//en.wikipedia.org).
10
Tata Skys Marketing Strategies

Head of Strategy planning, Percept/H38, The older value-add strategy of Tata Sky was a better
one. From a strategic point of view, this campaign seems to take a step backwards, giving the
brand a more generic messaging.39
While the first TVC was created by Rediffusion Y&R40, the second and third TVCs were created
by Ogilvy and Mather India (O&M India).41 The TVCs were supported with outdoor, radio and
Internet advertising.
Apart from the advertising campaigns, Tata Sky also announced some promotional offers
including a 50 percent discount on installation, which meant the installation charge was Rs 500
instead of Rs. 1,000. Other offers were Recharge and Win where consumers could win a DVD
player or LCD TV, Fun Learning Pack Promotion, where winner could meet the WWE champion
Kane42 along with an accompanying person.etc.
On April 01, 2009, Tata Sky launched the Friends and Family Program which was a reward
based referral program. In this program, till July 31, 2009, each time a Tata Sky subscriber referred
a new customer he/she would be rewarded by the company, depending on the number of new
customers referred. The reward could be a free credit in his/her Tata Sky account ranging between
Rs. 300 and Rs 375, or DVD-Pack of Khans hit movies and a special message from him/her, or a
set of two coffee/cocoa mugs autographed by Khan accompanied by coasters which would have
his movie trivia, or a relaxation Beanbag autographed by Khan. The new subscriber would get two
months free subscription to either the South Jumbo or the Super Saver pack. (Refer to Exhibit
VII for Tata Skys Offers and Promotions).

THE ROAD AHEAD

In March 2009, Tata Sky received the ISO 27001:200543 accreditation, an internationally accepted
standard for Information Security. It was the first Indian DTH service provider to receive the
accreditation.
According to the projections made by the Media Partners Asia (MPA), a media research agency
based in Hong Kong, Indian DTH service providers together would incur operating losses of more
than US$ 450 million in the financial year 2008-09. According to Vivek Couto, Executive
Director, MPA, We estimate that of the $450 million in operating losses, Tata Sky, Dish TV, and
Sun Direct will lose to the tune of $350 million while the rest will be shared between Reliances

38
Percept/H, the flagship advertising agency of Percept Limited, that services Indian and multinational
brands in India, is a 50:50 joint venture of Percept Limited, Indias largest integrated marketing
communications group and Hakuhodo Inc, Japans second largest advertising agency. Its clients include
Hero Honda, Sharp TVs, DLF, Canon, Electrolux, Future Group, Pantaloons, Ola Jewelry etc. (Source:
http://www.perceptindia.in).
39
Neha Kalra, Its Sodhiji This Time, for Tata Sky, http://www.afaqs.com, April 27, 2009.
40
Rediffusion Y&R, an India based advertising agency, was founded in 1973. Its clients include Bank of
India, Airtel, Indian Oil, Heinz, Tata Motors, Reliance General insurance etc.
41
Ogilvy and Mather India (O&M India), founded in 1928, was the first advertising agency in India. It is a
subsidiary of OgilvyOne Worldwide, which in turn is the subsidiary of Ogilvy & Mather Worldwide, an
international advertising, marketing, and public relations agency based in New York, the US.
42
The World Wrestling Entertainment (WWE) Championship is a professional wrestling world heavyweight
championship in World Wrestling Entertainment (WWE). Kane is the ring name of Glenn Thomas
Jacobs, an American professional wrestler and former WWE champion.
43
The ISO 27001:2005 is an international standard that provides specifications and guidance for the
establishment and proper maintenance of an Information Security Management System (ISMS). The
assessment for the certification was conducted by Intertek Systems Certification, the management systems
registration business unit of Intertek Group. (Source: http://www.tatasky.com).
11
Tata Skys Marketing Strategies

Big TV and Bharti Airtels DTH arm.44 According to newspaper reports, in the financial year
2007-08, Tata Sky had incurred a loss of over Rs. 8.3 billion because of the heavy subsidy given
on the digicomp by the company.
Tata Sky focused on increasing its subscriber base to make a profit. The company announced its
goal of increasing its consumer base by 1-2 million each year. In an effort to achieve this target, it
planned to introduce more value added services and also to focus on the PPV model. According to
Kaushik, Our clear focus is on bringing content and value-added services apart from bringing in
new movies for our pay-per view model... We want to add 1-2 million customers each year.45
To enhance its value added services, in April 2009, Tata Sky partnered with famous chef Sanjeev
Kapoor whose recipes were to be a part of Tata Skys Active Cooking service. It also entered into
an agreement with Ferns N Petals for a flower delivery service across the country.
Tata Sky was criticized for its higher installation cost compared with other DTH service providers
in India. However, the company countered the criticism by pointing out that in spite of high
installation cost, as of mid-2009, the company enjoyed higher ARPU (Average Revenue per User)
compared to other players in the Indian DTH market. The company attributed the high ARPU to
its customer service, technology, and value added services. According to Kaushik, [Because of]
our customer service and quality value-added services, we hold over 45 per cent of the DTH
market in terms of value. Our ARPU too, is at least 30 to 40 per cent more than most other players
in the industry.46

44
DTH Firm Losses May Cross Rs 2,000 Cr in 2008-09, http://www.business-standard.com, December
30, 2008.
45
Tata Sky to Add 1-2 Mn Subscribers Every Year, http://www.thehindubusinessline.com, March 19,
2009.
46
Tata Sky Bets on Value-Added Services to Gain Share, http://www.blonnet.com, June 10, 2009.
12
Tata Skys Marketing Strategies

Exhibit I
Logo of Tata Sky

Source: http;//www.tatasky.com.

Exhibit II
Home Page of Tata Skys Website

Source: http://www.tatasky.com.

13
Tata Skys Marketing Strategies

Exhibit III
Tata Skys Interactive Services
Interactive Description
Services
Active Mall The consumer can buy electronic appliances, household goods, and
download mobile ringtones and wallpapers from the Active Mall Mobile
Downloads page.
Active Wizkids This is designed for preschoolers. With Active Wizkids, a childs learning
process could continue at home through fun learning games, rhymes, and
art and craft activities.
Active Stories This is a television-based storybook that children can read and listen to at
their own pace. The service features new stories in six languages
English, Hindi, Tamil, Telugu, Bengali, and Marathi every day from the
Panchatantra, Jataka Tales and the Hitopadesh.
Active Learning It is a quiz-based educational interactive learning service covering
Mathematics, General Knowledge, and Science for children in the age
group of 7-11 years.
Active Topper An interactive service, this provides revision tests and key learning for
chapters taught in Maths and Science in classes 9 to 12. The revision
topics are based on topics taught for the day on Topper channel.
Active Games Viewers can choose from six games on their TV that can be played with
the Tata Sky remote. These games on TV are refreshed periodically.
Active Darshan Viewers can get a view of the ISKCON temple, Juhu and the Shirdi Sai
Baba temple on their television, throughout the day. Tata Sky introduced
this new service in partnership with STAR News.
Active Sports In this interactive service, viewers can choose their commentary language,
watch highlights on demand, and know players statistics. As of June
2009, the service was available on select events.
Active Viewers can get free access to 1000 new profiles every week. The profiles
Matrimony are sourced on an opt-in basis from premium members of
BharatMatrimony.com.
Active Cooking Viewers can get their favorite recipe. The service features four new and
easy-to-cook recipes daily from master chefs across the country along with
handy kitchen tips.
Active Astrology Viewers can get daily predictions from Bejan Daruwallas Ganesha
Speaks.
Active Star News Viewers can control how and when they want to watch the news. They can
opt for headlines, top stories and features.
Showcase Viewers can watch the newly released films in original prints, with a
single ad-break. Showcase events can be ordered once and enjoyed
multiple times throughout the day.
Source: http://www.tatasky.com.

14
Tata Skys Marketing Strategies

Exhibit IV
Tata Skys Channel Packages
Channel Packages Prominent Channels
Base Packages
Super Hit Pack (60 Channels) Aakaash Bangla, Disney Channel, Set Max, Sony
Entertainment TV, Star Plus, SAB, Active Games etc.
South Starter Pack (76 Channels) DD Bharti, ETV Marathi, TV9, SUN TV, STAR Jalsa,
Active Mall etc.
Super Value Pack (99 Channels) STAR Plus, Zee Bangla, Discovery Channel, National
Geographic, ETV Telugu, Active STAR news etc.
Super Saver Pack (124 Channels) Channels and Interactive Services in Super Value Pack +
AXN, HBO, Pogo, Zee Business, etc.
South Saver Pack (110 Channels) Channels and Interactive Services in South Starter Pack +
STAR World, Headlines Today, Times Now, Zee Caf,
Cartoon Network etc.
South Value Pack (96 Channels) All Channels and Interactive Services in Super Hit Pack
and South Starter pack
South Jumbo Pack (139 Channels and Interactive Services in South Saver pack +
Channels) STAR Gold, ZEE Cinema, Set Max, NDTV India etc.
Add On Packages
Fun Learning Pack (5 Channels) Cbeebies, Active Wizkids, Active Learning, Active Stories
and Active Topper
Lifestyle Gold Pack (16 NDTV Good Times, BBC Entertainment, Active Cooking,
Channels) Active Darshan etc.
Lifestyle Bronza Pack (4 NDTV Good Times, Sri Venkateswara Bhakti Channel,
Channels) Active Cooking, and Active Darshan
Sports Gold Pack (2 Channels) Neo Cricket, Neo Sports
Sports Platinum Pack (3 ESPN, STAR Cricket, and STAR Sports
Channels)
ESPN & Star Sports Pack (2 ESPN, STAR Sports
Channels)
Sports Bonanza Pack (6 ESPN, STAR Cricket, NEO Sports etc
Channels)
A La Carte Channels Consumer could choose to add among any of the channels
including Ten Sports, STAR Cricket, Topper, Zee Telugu,
and Zee Kannada
Source: http://www.tatasky.com.

15
Tata Skys Marketing Strategies

Exhibit V
Features of Tata Sky+
With Tata Sky+, consumers could record their favorite program or movie. They could record up
to 45 hours of live TV with Tata Sky+. They could,
record one channel while watching another;
record two channels simultaneously while watching one of the channels being recorded;
record two channels simultaneously while watching a previously recorded program; and
record a TV series automatically. Consumers could also set their favorite daily program for
recording only once and it would get recorded automatically everyday.
If they wanted to record all the episodes of a program back-to-back, they had to set a series
link for the program after they set the program for recording. This ensured that all episodes of
the program were automatically recorded.
Tata Sky+ allowed consumers to manage recordings in three modes Automatic, Warning, and
Manual. In the Automatic mode, which was the default setting, recorded programs were deleted
automatically when there was insufficient disk space to record new programs. Recorded
programs that had been previously watched were deleted first, followed by recorded programs
that had not been watched. In the Warning mode, consumers were shown a warning screen when
the disk was full. Consumer could then choose to delete recordings to free up disk space. If they
did not delete old recordings, Tata Sky+ automatically deleted the recordings as in the
Automatic Mode. In the Manual mode, the recording stopped when the disk space ran low; no
warning was displayed. Consumers had to ensure that unwanted recordings were regularly
deleted to make space available for new recordings.
Consumers could also ensure that specific programs were not deleted when Tata Sky+
automatically deleted content from the hard disk, by saving a program using the PIN protect
feature. Tata Sky+ did not automatically delete any program that had been PIN protected. To
lock and delete such programs, the consumer would require entering a PIN.
In addition to pausing live telecasts and rewinding TV programs; consumer could set a program
for recording from the Search & Scan banner.
Source: http://www.tataskyplus.com.

16
Tata Skys Marketing Strategies

Exhibit VI
Home Page of Tata Sky+ Website

Source: http://www.tataskyplus.com.
Exhibit VII
Tata Skys Offers and Promotion

Source: http://www.tatasky.com.

17
Tata Skys Marketing Strategies

References and Suggested Readings:

1. R. Ravikumar, Direct and Daring, http://www.thehindubusinessline.com, June 11, 2009.


2. Tata Sky Bets on Value-Added Services to Gain Share, http://www.blonnet.com, June
10, 2009.
3. Vipin Bajaj, DTH Companies Shift to Rural India for Subscribers,
http://www.televisionpoint.com, June 03, 2009.
4. The Direct-To-Home TV Sector Will Prosper despite the Worsening Economic
Outlook, http://viewswire.eiu.com, April 27, 2009.
5. Neha Kalra, Its Sodhiji This Time, for Tata Sky, http://www.afaqs.com, April 27, 2009.
6. Tata Sky Enhances Value Added Services, Offers Flower Delivery,
http://www.sify.com, April 24, 2009.
7. Tata Sky Offers Discount to Nano Buyers, http://business.rediff.com, March 24, 2009.
8. DTH Grows Immensely in India, http://cellbhart.com, March 20, 2009.
9. Tata Sky to Add 1-2 Mn Subscribers Every Year, http://www.blonnet.com, March 19,
2009.
10. Ajita Sashidhar, Great Expectations, http://www.business.outlookindia.com, March 07,
2009.
11. Priyanka Bhardwaj, DTH Industry in India, http://www.merinews.com, January 12,
2009.
12. Tata Sky: Launching a Major Satellite TV Business with Unprecedented Speed,
http://www.01-ibm.com, January 05, 2009.
13. DTH Firm Losses May Cross Rs 2, 000 Cr in 2008-09, http://www.business-
standard.com, December 30, 2008.
14. Tata Sky Demands 5 Yr Tax Holiday for DTH Industry, http://www.blonnet.com,
November 04, 2008.
15. Tata Sky Introduces New High-Tech DTH Service, http://www.domain-b.com, October
14, 2008.
16. Tata Sky Restores ESPNs Channels to Basic Package, http://www.blonnet.com, June
07, 2008.
17. Dish-Tata Sky War of Words over New Pricing, http://www.business-standard.com,
June 03, 2008.
18. Tata Sky Reduces Monthly Subscription Rates, http://www.blonnet.com, June 02,
2008.
19. Tanvi Shukla, Tata Sky's Pricing Strategy is Pretty Attractive, http://www.sify.com,
February 06, 2008.
20. L.N.Revathy, Tata Sky Bets Big on Interactive Services, http://www.blonnet.com,
January 22, 2008.
21. Ritesh Gupta, DTH Aims for Blue Sky in Booming India, http://www.onscreenasia.com,
December 01, 2007.
22. Cynthia Rodrigues, Spanning the Indian Sky, http://www.tata.in, October 2007.
23. Meenakshi Verma, Tata Sky Bets on Interactive Advertising,
http://www.economictimes.indiatimes.com, September 13, 2007.

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Tata Skys Marketing Strategies

24. Ashish Sinha, No Retreat Likely on DTH Regulations, http://www.business-


standard.com, September 12, 2007.
25. TRAI Frames Regulations to protect DTH Subscribers,
http://www.financialexpress.com, September 01, 2007.
26. Tata Sky Investing Rs 2,000 Cr More, http://www.blonnet.com, August 09, 2007.
27. Sivasundaram Umapathy, Industry Analysis: DTH Industry in India,
http://sivasundaram.com, August 2007.
28. Cracking the Indian DTH Market, http://www.financialexpress.com, February 03,
2007.
29. Paromita Pain, Consumer Education Key to Tata Sky Brand Building,
http://www.blonnet.com, January 25, 2007.
30. All the Entertainment You Need, http://www.tata.in, January 2007.
31. Purvita Chatterjee, DTH Is Here, http://www.blonnet.com, October 12, 2006.
32. TRAI Issues Paper on Amending DTH Licence Norms, http://www.blonnet.com, June
09, 2006.
33. Thomas Abraham, Tata Sky Target 1 July for DTH Launch,
http://www.indiantelevision.com, April 20, 2006.
34. Anjan Mitra, DTH Players Target 33% of Cable TV Market in 2 Years,
http://www.indiantelevision.com, March 10, 2004.
35. http://www.tatasky.com.

19