Services
&
Relationship Marketing
Assignment
Name: V Vidya
Roll no.: 18BBA052A
Class: II BBA
Services Industry
Service industry, an industry in that part of the economy that creates
services rather than tangible objects. Economists divide all economic
activity into two broad categories, goods and services. Goods-producing
industries are agriculture, mining, manufacturing, and construction; each
of them creates some kind of tangible object. Service industries include
everything else: banking, communications, wholesale and retail trade, all
professional services such as engineering, computer software
development, and medicine, non-profit economic activity, all consumer
services, and all government services, including defense and
administration of justice. A services-dominated economy is characteristic
of developed countries. The services sector is not only the dominant
sector in India’s GDP, but has also attracted significant foreign
investment flows, contributed significantly to exports as well as provided
large-scale employment. India’s services sector covers a wide variety of
activities such as trade, hotel and restaurants, transport, storage and
communication, financing, insurance, real estate, business services,
community, social and personal services, and services associated with
construction.
Entertainment Industry
The media and entertainment industry in India consists of many
different segments under its folds such as television, print, and films. It
also includes smaller segments like radio, music, OOH, animation,
gaming and visual effects (VFX) and Internet
advertising.[1] Entertainment industry in India has registered an explosive
growth in last two decades making it one of the fastest growing
industries in India. From a single state-owned channel, Doordarshan in
the 1990s there are more than 400 active channels in the country. In the
Indian television industry with the introduction of digital distribution
platforms like direct-to-home (DTH) and Mobile TV, Indian television
industry has undergone a revolutionary change.
Current scenario of the
Entertainment Industry in India
Introduction
The Indian Media and Entertainment (M&E) industry is a sunrise sector
for the economy and is making high growth strides. Proving its resilience
to the world, the Indian M&E industry is on the cusp of a strong phase of
growth, backed by rising consumer demand and improving advertising
revenues. The industry has been largely driven by increasing digitisation
and higher internet usage over the last decade. Internet has almost
become a mainstream media for entertainment for most of the people.
The Indian advertising industry is projected to be the second fastest
growing advertising market in Asia after China. At present, advertising
revenue accounts for around 0.38 per cent of India’s gross domestic
product.
Market Dynamics
Indian media and entertainment (M&E) industry grew at a CAGR of
10.90 per cent from FY17-18; and is expected to grow at a CAGR of
13.10 per cent to touch Rs 2,660.20 billion (US$ 39.68 billion) by FY23
from Rs 1,436.00 billion (US$ 22.28 billion) in FY18. India's media
consumption has grown at a CAGR of 9 per cent during 2012-18, almost
nine times that of US and two times that of China. The industry provides
employment to 3.5-4 million people, including both direct and indirect
employment in CY 2017.
Recent development/Investments
The Foreign Direct Investment (FDI) inflows in the Information and
Broadcasting (I&B) sector (including Print Media) in the period April 2000
– March 2019 stood at US$ 8.38 billion, as per data released by
Department for Promotion of Industry and Internal Trade (DPIIT).
The Indian digital advertising industry is expected to grow at a
Compound Annual Growth Rate (CAGR) of 32 per cent to reach
Rs 18,986 crore (US$ 2.93 billion) by 2020, backed by affordable
data and rising smartphone penetration.
India is one of the top five markets for the media, content and
technology agency Wavemaker where its services clients like Hero
MotoCorp, Paytm, IPL and Myntra among others.
Government Initiatives
The Telecom Regulatory Authority of India (TRAI) is set to approach the
Ministry of Information and Broadcasting, Government of India, with a
request to fastrack the recommendations on broadcasting, in an attempt
to boost reforms in the broadcasting sector.
The Government of India has supported Media and Entertainment
industry’s growth by taking various initiatives such as digitising the cable
distribution sector to attract greater institutional funding, increasing FDI
limit from 74 per cent to 100 per cent in cable and DTH satellite
platforms, and granting industry status to the film industry for easy
access to institutional finance.
Road Ahead
The Indian Media and Entertainment industry is on an impressive growth
path. The industry is expected to grow at a much faster rate than the
global average rate.
Growth is expected in retail advertisement, on the back of factors such
as several players entering the food and beverages segment, e-
commerce gaining more popularity in the country, and domestic
companies testing out the waters. The rural region is also a potentially
profitable target.
The Indian media industry has tremendous scope for growth in all the
segments due to rising incomes and evolving lifestyles. Media is
consumed by audience across demographics and various avenues such
as television, films, out of home (OOH), radio, animation and visual
effect (VFX), music, gaming, digital advertising, and print.
Direct-to-home television in India
Direct-to-Home (DTH) television is a method of receiving satellite
television by means of signals transmitted from direct-broadcast
satellites.[1] The Government of India permitted the reception and
distribution of satellite television signals in November 2000. The first
DTH service in the country was launched by Dish TV on 2 October
2003. DD Free Dish, the first free DTH service in India, was launched by
public broadcaster Prasar Bharati in December 2004.
India is the largest DTH market in the world by number of subscribers.
As on 31 December 2017, there were 67.56 million active pay DTH
subscribers in the country.[2] These figures do not include subscribers of
free DTH services.
The Indian market is serviced by 5 paid DTH providers and one free
DTH provider:
Airtel Digital Tv
DD Free Dish
Tata Sky
Sun Direct
Tata Sky Limited, is a joint venture between Tata Sons and TFCF Corporation
(formerly known as Twenty-First Century Fox, Inc.). Incorporated in 2001 and
launched services in 2006, Tata Sky is India's leading content distribution
platform providing Pay TV and OTT services. With the objective of connecting
to the best content in the world on any budget, any screen, anytime and anywhere.
Tata Sky was the first to launch multiple products and services that redefined the
subscribers viewing experience in the country.
It was the first to bring customized package and ala-carte channels options and
Interactive services on the platform, Hindi programming guide, DIY video library
and many more. Tata Sky brought about a complete paradigm shift in the market
with the launch of Tata Sky+, offering the breakthrough 'Personal Video
Recorder' (PVR) technology for the first time in the Indian subcontinent, with
unique features such as Pause, Record & Rewind Live TV. It is the only Pay TV
player in the world, to have a successful business model on its offering of
pioneering interactive services today.
Tata Sky provides the most comprehensive channels and platform services line-
up ranging from movies, news, entertainment and sports channels. The Tata Sky
Mobile App enables subscribers to experience Live TV as they would have
watched it on their TV sets, along with services such as On-Demand with over
3000 titles.
The company has invested in state-of-the-art digital infrastructure, partnered with
global leaders to provide superior technology and set-up high-end 24x7 call
centres in 13 languages across the country manned by multi-lingual customer
service associates to offer professional and efficient customer service. Tata Sky
currently has over 600 channels and services.
Tata Sky has been a pioneer in the HD Set top box segment having significant
market share in the category. It has been continuously adding new channels and
platform services across various genres and languages to beef up its content
offering to cater to all segments of the audience. Tata Sky currently has its
footprints spread across 2 lakh towns with over 18 million connections in India.
Tata Sky has a lot of competitors namely Dish TV, Videocon d2h, and Hathway.
The space has become very competitive because there are so many DTH players
in India, which is the only country where you have five of them. In all other parts
of the world, there are only two players,” observed Anil Khera, CEO, Bharat
Business Channel, Videocon’s media arm.
A decade after launching its services on the platform of providing DVD quality
picture and CD quality sound, Tata Sky was keen to celebrate this land mark
and had the Big B channelling his inner child (complete with a party) hat at a
noisy birthday party. With over 12 million subscribers and a rapid evolution
beyond its core DTH business (recording, video on demand, a host of value-
added services and rapidly growing users for its mobile app), the company had
reason enough to celebrate. However, as it cheered this milestone, company
officials have also wrestled to keep Brand Tata Sky fresh in a market that has
rapidly commoditised.
Tata Sky has stood out from the crowd for its simpler channel navigation, value
added services and newer breakthroughs such as a one-hour delayed telecast for
select channels. The brand has simple focus — how to entertain my audience —
and we’re building campaigns around not just the channels, but a host of add on
offerings from devotional services to English classes to steer ahead of the
competition, rather than push Tata Sky as a mere provider of TV channels for
consumers to browse. The evolution of the DTH industry, however, offers some
tough lessons for Tata Sky. With little room to manoeuvre on prices and
channel offerings, the company has had to look beyond in what is a boiling
down to a four-cornered fight for India’s DTH TV viewers.
Initially, Tata Sky launched its services focused on high quality and then moved
to the widest choice of channels, Tata Sky, today, is not just a DTH service
provider, but a one-stop provider of content. Along the way, it has steered the
evolution of a platform which boasts of over 600 channels on its DTH platform
and a tenfold growth in its on demand unit from over 300 titles to over 3500.
Lowering prices has helped bring in more subscribers nearly halved from, with
Tata Sky morphing from a predominantly urban brand to today having some 70
per cent of its users in the hinterland. The company has looked further afield to
prop up the brand. Tata Sky claims it has the best service network and a failure
rate of 0.2 per cent for its products. “The only differentiator which is sustainable
is quality of service”, said the Nagpal, the CEO of Tata Sky.
On 1st June,2019 Direct-to-home operator Tata Sky Tuesday said it has
partnered Amazon to offer access to various video streaming apps via a single-
monthly-subscription fee of Rs 249 through its platform Tata Sky Binge.
It would operate through Amazon Fire TV Stick – Tata Sky Edition, through
which Tata Sky users can view contents from apps like Hotstar, Sun NXT, Eros
NOW, and Hungama Play, the company said in a statement.
Tata Sky, a joint venture between Tata Sons and 21st Century Fox, is initially
providing Tata Sky Binge services in top 66 cities and would later expand it to
other cities.
Overview
Subscribers: Over 12 million a decade after it began operations.
Services: Direct-to-home cable TV; recording; video on demand; a mobile app
which allows anywhere access.
Challenge: A market with many rivals and little leeway to increase prices,
channels or leverage unique technology.
Competition: Not just legacy TV services providers (cable and DTH), but
newer OTT players including global biggie Netflix.
The Future: To keep pace, Tata Sky is tweaking the brand to focus on fuzzier
areas like customer service and quality, even as it evolves into a broader digital
content provider.
Tata Sky marketing mix(4Ps)
strategy
Marketing Mix of Tata Sky analyses the brand/company which covers 4Ps
(Product, Price, Place, Promotion) and explains the Tata Sky marketing
strategy. The article elaborates the pricing, advertising & distribution strategies
used by the company.
Let us start the Tata Sky Marketing Mix:
Product:
The product strategy and mix in Tata Sky marketing strategy can be explained
as follows:
Tata Sky is one of the well renowned DTH operators in India. Tata Sky
provides direct to home platform for content ranging from movies, news, sports
and entertainment. It provides product under following categories as part of its
product offering in its marketing mix:
• Pay TV and OTT services
- Tata Sky SD: Offers DVD quality picture and CD quality sound
- Tata Sky HD: Offers high definition viewing with surround sound and 1080i
resolution at 16:9 aspect ratio
- Tata Sky + HD: Provides 1080i resolution with Dolby Digital surround sound
and allows simultaneous recording up to three shows or programmes
- Tata Sky 4K: Provides ultra-high definition viewing (4 times the resolution of
full HD)
• Tata Sky Mobile App
Pay TV and OTT (over the top services) are provided through set top boxes, the
company was pioneer in HD set top box segment and Personal Video Recording
(PVR) service offering in India. Tata Sky mobile app offers Live TV services
alongside more than 3000 titles on demand.
Price:
The pricing strategy in Tata Sky marketing strategy:
Tata Sky begun its services by targeting Tier 1 cities initially, thus charging
premium price for quality services. However, there was a paradigm shift in its
pricing strategy from 2008 when it adopted competitive pricing to penetrate
market. Tata Sky follows a product line pricing in its marketing mix where it
prices its different offerings like SD, HD and HD+ subscription at different
price level, Tata Sky provide special discounted packages like Platinum to
incentivise longer term packages. The company has segmented price levels for
Kids, Sports, Music, and other packages. Tata Sky also adopts Optional-Feature
pricing wherein it provides base packages at competitive prices but charges
premium for add on services. General format of pricing offered to customer is a
base package plus add-on packs, Tata Sky service packs and Special Packs.
Customer are also offered regional language packages at competitive prices. To
promote its newer product offerings, Tata Sky prices its services at discount,
bundled with new product, like with the purchase of new set top box for multi
TV subscription the channels are provided at fraction of normal prices.
Place:
Following is the distribution strategy of Tata Sky:
Tata Sky’s current footprint in India is spread across 2 lakh towns and 17
million connections. Tata Sky has adopted service as its key differentiator with
no differentiation possible with content and pricing in competitive market. Sales
representative and trained service personnel are deployed at every point of sales.
The company has set up 24x7 call centres in 14 languages across country with
trained multi-lingual professionals. There are more than 600 channels available
for Tata Sky subscription. Online account management facility is available to
facilitate customers to modify their subscription and pay bills online.
Content related services also available through mobile app platform.
Promotion:
The promotional and advertising strategy in the Tata Sky marketing strategy is
as follows:
Tata Sky vouch for creating emotional connect through TV commercials and
contracting popular celebrities for endorsing the brand. Paid media both online
and offline such as TV, newspaper, magazine, and sponsorships are utilized to
communicate brand offering. Tata Sky has sponsored popular events like IPL to
show its ads and brand. The distribution channel also helps in displaying ads.
Owned media such as Tata Sky’s webpage, brand brochure, blog is used as a
part of campaign. The company has used digital and social media to improve
engagement with the customers. To create bond between characters and
consumers customized Facebook and Twitter pages have been created.
YouTube videos and competition have created buzz and increased involvement
of consumers in campaign and thus extended the recall.
Since this is a service marketing brand, here are the other three Ps to make it the
7Ps marketing mix of Tata Sky.
People:
Tata Sky has over 16000 employees, focussed on provide exceptional service to
customers. The company values services as its differentiation proposition and
hence invest a lot on training work force. It emphasizes on providing an
environment to develop, discover and demonstrate talent. Tata Sky offers 24x7
multilingual support services which requires extensive training focussed on
consumers and interpersonal communication. Training sessions are aimed
towards developing cross-functional knowledge to its employees. Tata Sky
maintains flat organisation and transparency to focus on innovation. The
organisation values Leadership, enthusiasm, innovation, agility, teamwork,
decisiveness, and integrity in its employees.
Physical Evidence:
Tata Sky is first Indian DTH provider to get ISO 27001:2005 accreditation a
benchmark for information security. Tata Sky has won numerous awards over
the years like Best DTH brand of the year and Product of the Year – Tata Sky +
HD from ET brand equity which provides evidence of company’s commitment
towards providing best in class service to its customers and bringing innovation
into the Indian DTH market place. Tata Sky is present in over 2 lakh towns and
it serves as platform to provide content in 14 different languages. The company
is focussing on improving online experience of its customer through online
account management services and mobile application.
Process:
Tata Sky must come up with frequent innovations due to competitive and
dynamic environment of the industry in which it operates. Tata Sky has
invented significantly to upgrade its technology and come up with new line of
services. To provide superior technology and support service the company has
collaborated with global leaders and has made significant investment in digital
infrastructure. Tata Sky has pioneered to bring many new features like Video on
Demand, DIY video library to provide better consumer experience. The
company strives to provide customized offerings like Actve Vedic Maths, Actve
Javed Akhtar to the Indian market. This completes the Tata Sky marketing mix.
