Prathyusha Agarwal decodes ZEE’s new tariff packs, highlights behavioural change

With the new tariff/ pricing regime set to come into effect from December 29, 2018, as per the TRAI mandate, Zee Entertainment Enterprises Ltd (ZEEL) has unveiled its Family Packs offer. 

Championing the ‘Freedom of Choice’, ZEE is promoting ‘Channels Ka Chunaav 2019’ – a multimedia multi-stakeholder communication initiative, urging viewers to fulfil demands of all family members through ‘Family Ki Suno, Zee Ko Chuno!’ 

While addressing the media Prathyusha Agarwal, CMO, ZEEL, called the new tariff regime a transformational structural change. She remarked that for the longest time this sector had been a low involvement category for consumers. “Now, because of the way TRAI has opened up the tariffs and put the power of choice in the consumers’ hands, over a period of time the consumer will start evaluating what they are paying for as pricing dictates the way we behave,” she added. 

Agarwal further said that the new tariff regime would lead to uniform pricing and offer a level playing field. 

Laying down the ground realities of television viewing in India, she noted, “There are 550 channels which are BARC rated. When you look at the reach of those channels for one quarter, you will find that a household consumes only 294 channels at a quarterly level. When you get it down to 80 per cent consumption, which forms the bulk of their consumption, then there are only 130 channels. This is at an all-India level. Looking at this, one realises that consumers are getting their needs from a basket of channels. While there 550 channels available, only 65 channels are consumed in a regional market, if you taken in the figures for Hindi Speaking Markets, the number goes up to 90-100 channels. This forms the bulk of the consumption and those channels are critical for the consumer. Therefore, if a household has 30-odd channels, 80 per cent of their consumption needs are satisfied. It is the 20 per cent variety that keeps fluctuating.” 

With this, all FTA channels will move to pay mode to ensure the comprehensiveness of the pack and the reach. “If you just leave it in the FTA 100, you won’t know whether they will have the reach or not because they are very attractively priced,” Agarwal said. 

The Behavioural Change Program 

Agarwal informed, “We have conducted price modeling and consumer research, including path to purchase. A big concern for consumers is whether they will end up dropping a channel from the pack that someone in the family might be watching because of their limited budget.” 

She stressed that this fear was unsubstantiated as consumers would realise that they could reallocate their money to the channels that they wanted. “That’s the insight we want to bring forward. Another thing we have learned by conducting this exercise is that television is seen as a family asset and so when consumers are in the process of making a decision the optimisation happens with the thought – Am I fulfilling the needs of the family? Hence, the bouquet that gets chosen is one that is optimised for everyday entertainment needs. That’s our approach for the behavioural campaign as well.” 

Agarwal further explained that the whole idea behind ‘Channel Ka Chunav’ was to change the mindset that the channel prices were increasing and instead bring in the mindset that choice was increasing. “When we communicated this to the distribution teams, they understood what it was fundamentally about. At a subconscious level we felt this was the right analogy to peg it on and that’s why ‘Channel Ka Chunav’ became the slogan for our behavioural initiative.” 

Customisation Options 

The new tariff regime doesn’t allow one to change the broadcaster bouquet, but consumers can choose an a-la-carte channel. “That’s the mandate which we couldn’t change. This is why we have created multiple packs such as Regional Pack, English Pack, which come from the principle that you do not want to force a choice. Additionally, these packs have been designed looking at what is the maximum consumption basket for a majority of the audiences versus where we could have done only three packs. Instead, we have looked at the consumption of every region and created fairly granular bouquets,” Agarwal maintained. 

Driving Awareness 

The ZEEL CMO felt that mass communication wouldn’t be adequate to give out all the details. She informed, “Even when we were conducting our research, we found that the first port to call for customers will be their cable operator. Hence, it is critical for any level of the distribution value chain to help the consumer understand what is happening. We have a WhatsApp outreach that is happening with operators across the country so that people on the last mile know what this is about.” 

Over the next six months, ZEE plans to drive an overall awareness of the choices that consumers will need to make. “We are equipping the trade or last mile distribution chain with the knowledge to supply the consumer. The last aspect that will be communicated is the path to purchase. Till now the biggest change in the broadcast industry was DDT, now it will be DDT + buy. Moving in this three-pronged way, where the final communication is ‘how to do’ rather than ‘what to do’, revealing the new open market pricing then we hope everyone will understand that they have to make a choice. How they make that choice can be facilitated by the final operator or they can look at the sites and figure it out. The actual behavioural shift is going to happen in the next six months,” she affirmed. 

Equipping the DPOs 

Agarwal was confident that the DTH players were equipped to handle the new tariff regime and the changes that would follow. She added, “They have the systems in place and the DTH consumers have also been equipped. Not every distribution platform or LCO is doing the final billing. In Delhi, I met an LCO who had his own app through which he was collecting his payments. People who are in tune with their consumers’ demands will be the first movers and gainers. The rest of the mass majority will follow them, because they don’t have the technological support systems.” 

The New Pricing Model 

Agarwal here pointed out that the earlier tariff regime was basically opaque. Currently, the new pricing model is put forth by ZEEL, which the group believes is based on the right demand-led pricing. “This is a channel which has a certain pull and love from its viewers, and therefore, a certain pricing has been fixed for it. Earlier, everything was a fixed bundle, but now we are making it more customer friendly. The narrative is about reallocation and not increase. When people are selecting, they get to choose whatever channel they want and the pricing could sometimes be more or less. There may or may not be marginal increase. We need to think dynamically. It’s not about them passing the ruling, but we also need to think, because it’s about dynamic pricing,” she maintained. 

How Ad Revenues will be Impacted 

Agarwal pointed out here that advertising revenue is a virtuous cycle. She added, “Brands that have the strength, pull and reach will keep going up. Since the consumer is making his/ her own choice, the reach will be more and in turn, the ad revenues will also go up. However, if the product is not good, you will obviously not get the revenues because there is no reach. Since it is an open market, it depends on what you are offering and how good your offering is that will differentiate you from the others.” 

Impact on Broadcasters’ Content Strategy 

“We at ZEE have never had random content,” maintained Agrawal, adding, “When they don’t work, we shut down those channels. Any good broadcaster who is committed to putting together good content has to evaluate whether their content is working or not. The advantage now is that there will be feedback on what kind of content is gaining traction and is being consumer more, which will help broadcasters refine their content strategy and give a better understanding of their consumers.” 

Demand for a 2-month Ratings Blackout 

While talking about broadcasters asking BARC not to conduct TV ratings for two months and whether BARC had agreed to this demand, Agarwal pointed out that ratings blackout had happened earlier as well when the digitisation process was underway in the country, hence this is not the first time. “Whenever there is a structural change or reform happening, it takes a while for stabilising the ground. Ratings are a sampling mechanism. When you have tectonic shift, then the sampling mechanism has to pause for the shift to settle down and re-calibrate their mechanism. We are going to see this happen now,” Agarwal concluded.


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