Synopsis of the

Tata Sky Case

for Comstrat 2008

Team eXcentric_XIMR

Heemanish Midde | Jeetendra Haryani | Tristan Braganza

24th October 2008

Xavier Institute of Management & Research, Mumbai

1

Table of Contents

1 Overview

1.1 Introduction 2

2 Market Research

2.1 Purpose and Scope 3

2.2 Research Objectives 3

2.3 Research Methodology 3

2.3.1 Research Design

2.3.2 Data Collection

2.4 Analysis and Findings 4

2.4.1 Primary Reason for Choosing DTH 4

2.4.2 Opportunity Analysis 5

2.4.3 Perceptual Mapping 6

2.4.4 JN Kapferer’s Brand Identity Prism 8

3 The Road Ahead

3.1 Communication Strategy 9

3.1.1 Media Strategy 9

3.1.2 Creative Strategy 10

4 Control & Testing effectiveness 11

Appendices

Appendix I: Questionnaire 12

Appendix II: Break-up of the Sample 14

Appendix III: SPSS Output 15

Bibliography 16

2

1

Overview

1.1 Introduction

India has about 133 million TV homes of which, Cable & Satellite (C&S) services are present in 76 million (57%)

of the homes.

The main DTH players are DD Direct, Dish TV, Tata Sky, Sun Direct, Big TV and Airtel.

One of the issues faced by DTH players is the low average revenue per user. Also, companies sell their STBs

at a loss and recoup the same over a period of time from usage charges (as of now, through captive pricing).

As a result of this, most DTH companies are expected to break even only after 5-6 years1. As a result, customer

alchemy (converting less profitable customers to more and more profitable services) is a very important

consideration. Since the cost of customer acquisition is very high, it is important to retain customers.

For now, the high switching costs involved in changing DTH providers (current-day Set-top Boxes or STBs are

not compatible across providers) keep consumers from switching providers. However, TRAI is trying to push

through norms to standardise STBs and allow for switching providers without having to change STBs.

With sales of 29” and bigger colour TVs at 4-5 Million a year, the DTH market is poised for a period of growth,

especially in semi-urban areas as well as smaller towns and cities.

There are other factors also fuelling the growth in the DTH industry. With increasing competition it is important

for companies to differentiate themselves.

Differentiating is a challenge going ahead....

1

“Dish TV, TataSky may post Rs 1,400-cr loss”, Business Standard, 09 Apr 2008

3

2

Market Research

2.1 Purpose and Scope

The main purpose of this research was to find opportunities for Tata Sky, given consumer satisfaction with

existing products on fixed parameters for evaluation and importance of each parameter (to consumers) for

evaluation of those products.

2.2 Research Objectives The objectives of this study are:

� To find out the primary reason for which DTH was bought

� To study the consumer preferences for DTH

� To study consumer perception of Tata Sky, with respect to JN Kapferer’s Brand Identity Prism

� To find out satisfaction levels of consumers with respect to previously identified important attributes

considered by consumers while evaluating DTH services

2.3 Research Methodology

2.3.1 Research Design

To accomplish the objectives, a study was conducted using secondary and primary data. The approach was

descriptive and responses were evaluated according to set criteria.

2.3.2 Data Collection

Secondary Data: Secondary data was collected from the internet and online forums for DTH users to identify

the main parameters that customers consider when deciding to go in for DTH services.

Primary Data: Primary data was collected through the use of structured questionnaires and an online survey. A

focus group was also conducted to determine consumer perceptions of Tata Sky, within the framework of the

Think-Feel-Do Model and JN Kapferer’s Brand Identity Prism.

Questionnaire Design: To keep things simple and reduce the time take to fill the questionnaire, most

questions were closed ended. Rating scales (10-point scales) were used for questions related to preferences

and satisfaction.

Sampling: The sampling technique was non-probabilistic - convenience sampling and snowball sampling.

Snowball sampling was used since a large sample across India was required in a relatively short period of time.

The questionnaire was put up online and the link to it was circulated to respondents via email, along with a

request to pass along the link. A free survey hosting service was used to host the survey at (link has been

closed since data collection was finished) The sample size was 152 individuals. [Refer to Appendix II for a

break-up of the sample]

http://www.surveymonkey.com/s.aspx?sm=wvxDKPuTtrb_2fDQ02KGQQ6A_3d_3d

http://www.surveymonkey.com/s.aspx?sm=vKuMBvTVLS7lBt6CWXZuqg_3d_3d

4

2.4 Analysis and Findings

2.4.1 Primary Reason for choosing DTH

As shown in Table 1 and Chart 1, the largest number of respondents went in or would go in for DTH because of

‘Bad service from cable operators’ (41%). The direct implication was that consumes were looking for better

service from DTH operators.

Table 2.1

Primary Reason for choosing DTH

Superior Video Quality 26.32% 40

More Channels 17.11% 26

Interactive Services 3.29% 5

Living in a CAS notified area (forced to for access to TV channels) 7.24% 11

More transparent payments 5.92% 9

Due to bad service from cable operators 40.13% 61

Total 100% 152

Also, ‘Transparency of payments’ was the primary reason for choosing DTH among 6% of respondents. Both of

these are customer service aspects.

Chart 2.1

Interactive

Services

3%

Superior Video

Quality

26%

More transparent

payments

6%

Living in a CAS

notified area

7%

Due to bad

service from

cable operators

41%

More Channels

17%

Superior Video Quality

More Channels

Interactive Services

Living in a CAS notified area (forced to for access to TV channels)

More transparent payments

Due to bad service from cable operators

5

2.4.2 Opportunity Analysis

Average importance of each parameter (from Q7 of the Questionnaire) was compared to average consumer

satisfaction levels (from Q9 of the Questionnaire) in the same parameter, and an Opportunity Score was found,

using the formula:

Opportunity Score = I*(I-S),

where I = Avg. Importance of parameter to Consumer,

S = Avg. Consumer Satisfaction level with that

Parameter

and (I-S) >= 0*

* - when (I-S) is less than 0, Opportunity Score is 0.

Calculated Opportunity Scores are tabulated in Table 2 given below.

Table 2.2 – Opportunity Score

Parameter Avg. Importance

to Consumer

Avg. Consumer

Satisfaction Level

Opportunity

Score Factor

Special channels for elderly people 0.08 -0.07 0.01

1

Educational interactive channels 0.03 0.09 0.00

Special channels for children 0.19 0.12 0.01

Ability to record programs 0.32 -0.07 0.12

Matrimonial services -0.76 -0.16 0.00

Helpline 1.47 0.33 1.68

2 DVD-quality video 1.59 0.83 1.19

Quick response to complaints 1.75 0.20 2.71

Quality of service 1.80 0.74 1.89

Ease of payment 1.31 0.96 0.45 3

Ease of purchase 1.08 0.82 0.29

Continued service even in heavy rains 1.40 0.10 1.83

4 MPEG 4 format video quality 0.82 0.27 0.45

Sound Quality 1.51 0.72 1.19

Price 1.37 -0.06 1.97 5

Number of channels 1.60 -0.20 2.87 6

Table 2.3

Factor Average Factor-specific

Opportunity Score

1. Value added services and interactive Services 0.03

2. Customer Service and basic quality 1.87

3. "Purchasibility" 0.37

4. Product Quality beyond basic quality 1.16

5. Price 1.97

6. Number of Channels 2.87

Tables 2 and 3 show that among the important factors for consideration, ‘Number of Channels’ (2.87) shows the

highest opportunity score. Considering that the number of channels a service provider can offer is easily

imitable, focusing on only this aspect does not make strategic sense. Price has the next highest Opportunity

Score. However, considering that Avg. Revenues per User are low (Rs. 140 per month #), not much can be

done in this direction. Customer Service has the next best score (1.87).

Factors as shown in Table 2 were identified using Factor Analysis in SPSS v.16. Please refer to Appendix III –

SPSS Output to see the Rotated Component Matrix for the same.

# As seen on pg 2 of the Case

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2.4.3 Perceptual Mapping

Chart 2.2 - Perceptual Mapping of DTH Players on the Basis of Price vs. Overall Score

Price Vs Overall

Dish TV

TATA SKY

Big TV

Airtel

DD DirectSun Direct

-2

-1.5

-1

-0.5

0

0.5

1

1.5

2

-2 -1.5 -1 -0.5 0 0.5 1 1.5 2

Quality, Customer Service and Interactive Services

Pri

ce

Chart 2 was mapped using the deviation of each brand’s score (without considering price) from the average and

then plotting vs. price i.e. the units are a relative measure of perception. As is evident from the chart, Tata Sky

and Airtel are positioned closely in consumers’ minds. It is imperative that Tata Sky educates consumers about

the points of differentiation between its offerings and those of Airtel.

Table 2.4 Consumer Scoring of DTH providers

Ratings Dish TV TATA SKY Big TV Airtel DD Direct Sun Direct

Price 0.319149 -0.20155 0.445946 -0.23188 0.985075 0.867925

Quality -0.30303 1 0.794118 0.881356 -0.20968 0.058824

Customer Service -0.62821 0.767241 -1.05263 0.458333 -1 -0.6

Interactive Service -0.26506 0.521008 -0.72727 0.604167 -1.24242 -1.54054

* Note: These scores are absolute scores. They are the average of consumer scores given on a scale from 1 to

5, which were adjusted to -2 to +2 during coding.

7

Chart 2.3 - Overall

Quality

Customer Service

Interactive Service

Price

-2

-1.5

-1

-0.5

0

0.5

1

1.5

Dish TV TATA SKY Big TV Airtel DD Direct Sun Direct

From Chart 3, it can be seen that Tata Sky ranks highest in Customer Service. Its closest competitor in terms of

overall score as well as consumer perception is Airtel. Airtel is lower on the Customer Service score, but not but

not by a very large margin. Also, when it comes to VAS, Airtel is ranked higher – Airtel even has the advantage

of having experience with VAS on its cellular services, which it could leverage in DTH.

The Single minded proposition which should be adopted to meet the business objective of accelerating

subscriber acquisition is “Customer Service” (Refer 2.4.1, 2.4.2, 2.4.3)

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2.4.4 JN Kapferer’s Brand Identity Prism

The Analysis was done using a Focus Group Discussion of current TataSky users.

Points discussed in the Focus Group Discussion:

Physique

What is Tata Sky?

What do you use it for?

What is the basic need?

What they like/dislike most about Tata Sky?

Personality

If Tata Sky was a person, what kind of person would it

be?

What kind of people do you think buy Tata Sky?

Relationship

How did Tata Sky interact with you when you were

buying it?

How does Tata Sky interact with you when making a

complaint or calling service?

How do you think the Tata Sky ads relate to you?

How does Tata Sky affect your relationship with your

family?

How does Tata Sky affect your relationship with your

friends?

Culture

What are the values Tata Sky stands for?

How important do you think these values are to you,

personally?

Reflection

As a user of Tata Sky, what do you think that says

about you?

What kind of people do you think buy Tata Sky?

Self Image

Please describe yourself in a few lines

What kind of person are you?

The findings are as follows:

Access to entertainment World class technology from “SKY” Light weight box

Fun and young Trustworthy

Making life ‘Jingalala’ (complete and fun) Reliability Simplicity

Trust and Innovation Driven Family Oriented

They are well-educated They are modern They want value

I am an up-to-date person I like new technologies

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3

The Road Ahead 3.1 Communication Strategy

Objectives

� To enhance the brand image of Tata Sky as the most preferred DTH service provider

� To differentiate the Tata Sky brand clearly from its competitors

� To accelerate subscriber acquisition

� To connect with the target group on an emotional as well as rational level

Target Audience: Families, especially young couples.

The Single-Minded Proposition: Tata Sky, with its concentration on superior service, takes care of families’

entertainment needs everyday, all day long, so that they can enjoy time with their loved ones.

Broadcast Print Awareness

camps

Internet Buzz

Attention Aware Reach Aware

Interest Educate Educate Educate Educate

Desire Promote Promote Promote

Action Retailers Shopping Buzz

marketing

3.1.1 Media Strategy

Scheduling

Pulsing is an effective strategy as it will enable the company to advertising continuously as well as at low-weight

levels which help reduce the cost. This form is suitable for the communication strategy as the strategy involves

educating the target about TataSky’s customer service initiatives.

Considering the increasing competition, it will be important to keep TataSky fresh in the consumer’s mind.

The media schedule will consist of:

� TVCs in major General Entertainment Channels, regional TV channels and DD;

� Insertions a week – 2 in mainline print media, 1 in a lifestyle magazine.

� Awareness camps should be organized regularly in malls. e-Marketing should be an on-going activity

throughout the year.

� Promotional campaigns can be held for members of Tata Sky's forums to encourage users to sign up

on them and to generate excitement.

Through our communication strategy we are communicating with our target group at various levels and using

various Media mix.

Broadcast: Primarily Television commercials and radio will be used to grab the attention of the target and

make them aware about Tata Sky’s customer service initiatives.

Print: Print ads will be used to educate the target about how can he use customer services and how Tata Slky’s

superior customer service would enhance his Television viewing experience

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Awareness Camps: Awareness Camps in the stores and malls will help create a platform through which

awareness, education and promotion can be spread at the same time.

These awareness camps will educate the customer why they need to have a Tata Sky DTH service and how

Tata Sky’s unparalleled customer service will ensure uninterrupted television viewing, when they want it.

Internet: The Internet will be used as an online platform through which we can spread awareness, educate and

promote our services to the target group. This will be an online platform through which consumers can even

address problems to Tata Sky. It was found during secondary research that there are a lot of forums created by

consumers themselves online. These are, very often, the more involved and knowledgeable consumers (in the

domain of DTH services) and thus represent a treasure house of lead users, who can act as barometers for

future trends in the market. A forum for consumers should be maintained on the Tata Sky website.

This will not only give the company advance warning of problems with its products, but also give consumers a

feeling of commonality and belonging to a community.

Social Networking sites can also be leveraged to educate customers and solve any problems they may face

while using Tata Sky.

Here we can create an animated Amir Khan who will have a profile on all networking sites and forums, he will

be on friends list of all the TataSky users registered and will address all their problems to this animated virtual

friend as well as ask for advice while purchasing a DTH service provider. (This will help the company to be a

part of the information search stage of consumer’s decision making process)

Buzz Marketing: Buzz Marketing is an important tool which should be exploited as it was noticed during the

research that our target group relied on third party recommendations to make the decision to buy. The Internet

and Awareness camps will ensure third party recommendations.

3.1.2 Creative Strategy

Positioning

Tata Sky is the DTH service provider with the best customer service to ensure no family will ever miss a minute

of entertainment and relaxation with loved ones.

Creative Execution

Marcom Message: Customer Service bhi aisi, ki ab toh bus mazza ala hi ala

Appeal: Soft-sell, emotional appeal, use of humorous situations

Format: Use of humour, use of people, slice of life, demonstration.

Brand ambassador: Brand ambassadors must be youthful, fun and playful.

Tone of Voice: Playful, humorous, friendly.

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4

Control & Testing effectiveness Control is very important to measure the effectiveness of the communication program

this ensures that money spent on communicating is well spent and the strategy used is

effective or no.

Sales-Effect Research;

Advertising’s sales effect is generally harder to measure than its communication effect.

Sales are influenced by many factors, such as features, price, and availability, as well

as competitor’s actions.

A company’s share of advertising expenditures produces a share of voice that earns a

Share of consumers’ minds and hearts and, ultimately a share of market

Sales-Effect Model

Share of expenditure

Share of voice

Share of mind & heart

Share of market

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Appendices

Appendix I: Questionnaire

13

[Link to a Preview of the Questionnaire]

14

Appendix II: Break-up of the Sample

Table B1 – Break-up According to Age

Age Break-up

Percentage Response Count

<18 years 4.61% 7

18-25 years 56.58% 86

25-35 years 30.26% 46

35-45 years 4.61% 7

45+ years 3.95% 6

Total 100% 152

Table B2 – Break-up According to Gender

Gender Break-up

Percentage Response Count

Male 85.53% 130

Female 14.47% 22

Total 100% 152

Table B3 – Break-up According to Usage Status

Status of Usage of DTH

Percentage Response Count

Yes 74.34% 113

No 25.66% 39

Total 100% 152

Table B4 – Break-up According to DTH Service Used

Usage Break-up

Percentage Response Count

Dish TV 15.83% 22

TATA SKY 58.27% 81

Big TV 10.79% 15

Airtel 2.16% 3

DD Direct 2.88% 4

Sun Direct 5.76% 8

Other 4.32% 6

Users (includes repetition)* 139

Non-users 39

*Please note, the figure for users includes consumers who use multiple DTH-services, since multiple choices

were available for this question.

15

Appendix III: SPSS Output

Table C1 – KMO and Bartlett’s Test

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling

Adequacy. 0.8252791

Bartlett's Test of Sphericity

Approx. Chi-

Square 844.75547

df 120

Sig. 0.00

As can be seen from Table C1, KMO Measure of Sampling Adequacy is 0.83, indicating that the sample size

was sufficient for carrying out Factor Analysis. Significance is 0.00, indicating that the test is valid at a 99%

confidence level.

Table C2 – Rotated Component Matrix

Rotated Component Matrixa

Component

1 2 3 4 5 6

Special channels for elderly people 0.845 0.17 -0.002 0.000 -0.03 -0.009

Educational interactive channels 0.831 0.025 0.117 0.166 0.183 0.085

Special channels for children 0.822 0.189 0.045 0.084 0.059 0.011

Ability to record programs 0.71 -0.199 0.221 0.164 0.161 0.305

Matrimonial services 0.706 0.214 0.003 0.032 -0.178 -0.139

Helpline 0.187 0.8 0.156 0.019 0.09 0.191

DVD-quality video 0.082 0.668 0.033 0.47 -0.072 0.098

Quick response to complaints 0.176 0.633 0.312 0.129 0.238 0.039

Quality of service 0.095 0.615 0.254 0.144 0.454 0.013

Ease of payment 0.017 0.137 0.908 0.018 0.081 0.164

Ease of purchase 0.195 0.267 0.85 0.149 0.142 -0.069

Continued service even in heavy rains 0.128 0.154 -0.02 0.808 0.338 -0.042

MPEG 4 format video quality 0.24 0.113 0.267 0.592 -0.286 0.199

Sound Quality 0.009 0.397 0.484 0.513 -0.138 0.117

Price 0.048 0.19 0.109 0.017 0.826 0.094

Number of channels 0.037 0.23 0.09 0.089 0.084 0.912

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization. a -

Rotation converged in 8 iterations.

16

Bibliography

Books:

Market Research Methodological Foundations: Gilbert Churchill Jr., Dawn Iacobucci

Marketing Research: Seventh Edition: Aaker, Kumar, Day

Articles:

The Harvard Business Review

http://www.tatasky.com/pressroom-2008-tata-sky-aamir-khan-brand-ambassador.html

http://www.business-standard.com/india/storypage.php?autono=332442

http://www.afaqs.com/perl/news/index.html?sid=22263

http://www.hindu.com/2006/10/20/stories/2006102003411902.htm

Blogs

http://sanjukta.wordpress.com/2008/08/25/tata-sky-new-commercial-featuring-aamir-khan/

www.dthguide.wordpress.com/2008/08/21/dth-in-india

www.indiadth.in

www.dthclub.com/tag/dth-india

Forums

www.saveondish.com

www.indiabroadband.com

www.dishtracking.com/forum

Communities on www.facebook.com and www.orkut.com

Websites

www.tatasky.com

www.afaqs.com