Mumbai: Tata Sky wants to shed its premium tag and has launched a new television campaign to drive home the point.

Tata Sky, the second-largest private DTH player in the country, never baulked at charging customers a premium for value additions. Its listed rival with the highest subscriptions, Dish TV, waged a price war with lowest packages — even free subscriptions — a few years back that quickly got replicated by other players. But Tata Sky refrained from joining the war and even charged viewers for its interactive suite when others provided theirs for free.

Yet, its latest campaign launched a few weeks back talks about sub-Rs 200 schemes, be they channel packs, a second home connection or free subscriptions. Tata Sky insists this is not about a shift in its strategy; but the television commercials tell their own story.

The ads feature two guys who urge the viewers to enquire about Tata Sky, even if it is to find out if it has low-priced products and services. With the twin taglines of "Poochhne mein kya jaata hai" and "Poochh dala to life jhingalala", the three TV ads follow the two blokes' fate after they ask outrageous questions in different situations. Contrary to expectations, they find their requests are not only entertained but actually granted. As a result, they muster the courage to visit a Tata Sky dealer to know more about low-priced Tata Sky offerings.

In the ad depicting a military parade, one of the two gets away with asking for a lift to his hotel from a surly officer on a tank, even as his friend, who had refused to help, looks on. The ad moves on to the pair's discovery of Tata Sky's offer of a monthly Rs 160 for a second Tata Sky connection.

The second ad is about the duo negotiating with menacing guard dogs to gain access to Tom Cruise's mansion for his autograph. They get their way, thanks to their persuasion skills. The ad highlights the State Pack launched six months back, priced at Rs 185. The third ad, modelled on a sequence in Christopher Nolan's The Dark Knight, has one of them asking automatic rifle-toting robbers in a bank heist for change for Rs 500 and ending up with an extra Rs 100 note. At the end of it, they find out about Tata Sky's offer of two to 12 months' free subscription on combo offers.

Shifting stand
Tata Sky Chief Marketing Officer Vikram Mehra says, "The price ranges which we talk about in the campaign have been there since launch. Our lowest-cost pack was in the league of mass market packs and comparable to any other DTH player, including those who play the lowest-ticket card. However, ours would not be the cheapest but the most valuable in a given price range. We had to educate the customer about this."

Note the shift here: In earlier interactions with the media, Tata Sky had stressed on the fact that it wanted to focus on consumers who were willing to pay a small premium for more value. That might have ended up giving Tata Sky the tag of being a premium product, revealed an internal study.

Mehra explains, "The fortnightly brand track that we conduct to find out the most recalled brand threw up a consumer perception that we were the most preferred but were seen as expensive and hence, unaffordable."

Not just the message, Tata Sky has also deviated from casting its brand ambassador since inception, Aamir Khan. The company and the agency say the creative required actors who could portray simpletons asking irreverent questions to drive home the humour.

Abhijit Avasthi, executive creative director at Ogilvy & Mather, who oversaw the campaign, says, "Aamir Khan had already made the brand look desirable and premium. But we realised we were also carrying the baggage of being unaffordable. We decided that this was a good time to focus on the value proposition." The insight was to play on the regret that people might have when they realise that if they had made some enquiries before making a purchase, they would have landed a much better deal.

Yes, as in other markets in India, deals matter in DTH. In the midst of the price war last year, Tata Sky was overtaken by Sun Direct, which raked in a low average revenue per user (ARPU) of Rs 99. The lowest-price card didn't see players through for long. Tata Sky is back being the second largest. To top its strength in customer service, it has lined up a host of services such as minimal relocation charges (Rs 125-250) when shifting one's home, a six-month protection to all new customers and also Rs 15 money-back for those topping up with Rs 301 or more every month.

Challenges abound
Tata Sky's ploy to look more affordable will have to gel with its reputation of best-in-class customer service. Its resistance to play the price card has held it in good stead given the dynamics of the DTH market. The set-top boxes, imported so far, are sold at a discount, with the result the operator takes a loss every time it signs up a new customer; the ARPUs are low in India ($3 compared to $25 in Malaysia and $70-90 in the US and the UK), slowing down break even. Sustainability will be driven by the renewal rate of each platform's customers. Rather than the total subscribers a player has, which is widely reported, what matters is how many renew their account regularly.

Industry sources say while Dish TV claims to have the largest number of subscribers at 11 million, around 5.8 million of those renew their accounts regularly. At 7.5 million subscribers, Tata Sky has a better rate of renewal at 5 million while Airtel Digital TV too enjoys close to 5 million renewals from a reported subscriber base of 6.2 million. Videocon d2h, the last player to enter the market, has clocked 4 million subscribers so far, but 1.8 million of them are active, according to market estimates. A customer seeking the cheapest product is a dangerous one to acquire because she will move out the moment she sees a lower priced offering from another provider, Mehra points out.

Vivek Couto, founder of Media Partners Asia, a Hong Kong-based media research agency that tracks the DTH industry in India, reckons that any operator has to acquire 5 to 6 million subscribers, who should each pay Rs 300 a month, to break even. For now, observers point out, no DTH player enjoys as much. Dish TV is the only player to have broken even, capitalising on its head-start. Tata Sky ranks higher than most with ARPU of Rs 230-250, while Dish TV is at Rs 150, Airtel at Rs 180, Videocon d2h at Rs 170 and Sun Direct at Rs 60-80.

To address the additional queries the campaign is bound to generate, Tata Sky is running training programmes for its support staff, including those at the call centres. Retaining those who come on board, as a result, would be left to its servicing prowess and the value additions.