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How has last year been compared to the previous year in terms of revenues?
Year on year, Turner International India has been showing outstanding performances, whether it is in terms of channel shares or revenues. 2005 was a fantastic year. From an ad sales perspective, we grew by 25 per cent and the combined growth between Cartoon Network and Pogo was about 30 per cent.
We established ourselves in numerous spaces. For example, from a sales perspective, we expanded our base of advertisers when we decided to go into the retail advertising strategy. As a result of this, we added nearly 56 new clients to our portfolio.
From a network perspective, we further consolidated our position as being the number one and number two kids channels. We came up with huge amount of initiatives on the content and marketing sides. For Cartoon Network, we did the Powerpuff Generation contest and Toon Cricket event. Last year, we had the biggest phenomenon in kids’ programming – Beyblade, which sort of changed the game for us in the market from a content and licensing point of view.
As far as Pogo is concerned, we had Pogo Funtakshari and Pogo Amazing Kids Awards. We also launched quite a few original productions, which is a clear focus for us even this year.
We did shows like M.A.D and Bam! Bam! Bam! Gir Pade Hum. Apart from that, we also launched a couple of Indian acquisitions likeKhichdi and Karma. Shaktiman, of course, was not launched last year, but it continued to reinforce our position in that aspect as we wanted to ensure that Pogo was seen as a channel for kids and families.
From a marketing point of view, we supported all of this. We had a huge amount of on-air and off air activities for Join the Powerpuff Generation and Pogo Amazing Kids Awards.
As far as licensing business goes, we launched a new range of products. We had started out with a seven categories and then introduced more than 30 product categories. In the licensing business, we had our brands like Johnny Bravo, Powerpuff Girls and Dexter and, of course, Beyblade was added on when it became a huge phenomenon.
All this kept reinforcing to everyone around and also within the company that we need to keep consolidating and moving on. And, that is what we have been doing very successfully in 2005. Overall, in Turner India, between Cartoon Network and Pogo, we have created new benchmarks for ourselves so that we are able to better that in the coming years.
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What percentage does the licensing and merchandising business contribute to the company’s overall revenues in India?
Merchandising has recently become big for us. While the division was always there, it was only last year that we came out in a big way by bringing out more categories and consolidation began. We’ve shown a 50 per cent growth so far from a year on year perspective.
At the moment, this business contributes about 10 per cent to our bottomline, but it’s still tip of the iceberg. The potential is huge with the retail business becoming big in the country and everyone focusing on it. This is one area, which is going to get a huge push by the network in India in the coming years.
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Can you give us a breakup of the revenue contribution of the four Turner channels in India – Cartoon Network, Pogo, HBO and CNN?
I can’t share the exact figures, but each channel’s positioning is very different. Cartoon Network and Pogo are very focused on the kids entertainment space. HBO is clearly targeted towards upwardly mobile English speaking individuals and CNN has its own distinctive positioning.
In their individual space, we are leaders when compared to nearest competitors; whether it is in terms of revenue or channel share. CNN’s positioning is more driven with high networked individuals.
Collectively, we have done extremely well and have shown year on year growth. As a network we have grown by 30 per cent.
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‘On our merchandising business, we have shown a 50% growth so far from a year on year perspective‘
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HBO recently hiked its ad rates. What prompted this decision?
This decision was basically based on the demand and supply graph. As the market grows, so does demand. Whereas the supply is limited as there are not too many players of HBO’s reckoning in the market.
HBO is the leader of the pack amongst the few channels that exist in the space. And, because HBO has been strengthening its positioning through its content as well, it made sense to come out and consolidate our rate strategy. That’s when we decided that it was time to take the next step and increase the rates. It makes the game a little more interesting.
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Going forward, is there going to be any change in strategy in selling HBO?
The strategy is pretty much the same. We are focusing on client solutions and integration. Selling time is generic across every channel. But we are looking at bringing additional value to the table for our clients. Our team comes up with ideas and strategies and we go to the client as a problem solver rather than telling them about our channel and rates and asking them to buy it.
We’ve come up with some great creatively integrated solutions for Titan Xylus, which revolved around Titan’s positioning statement for their brand. So the movie selection, packaging and promotion happened accordingly. The client also felt good about it because there was clearly a distinction that we brought to the table. We have also done similar initiatives for Pepsi TV and are in the process of finalizing something for Marico’s Parachute.
We keep adding brands and coming up with integrated creative solutions for clients.
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What is going to be your strategy to improve ad sales across the bouquet?
Ad sales is a critical function. Improvisation on every strategy whether it is ad sales, programming or marketing is always important. The whole objective is to keep bettering what has been done before. Our internal mantra is: we are our own competitors.
Keeping that in mind, the strategy really is to focus and come up with the best marketing solutions for clients and to be seen more as a partner in the game rather than creating a them-versus-us situation. We try to see wherever a partnership can be further consolidated and figure out how to bring the best value to a client. At the same time not losing focus on what you think is value for your brand.
So whether it is Cartoon Network, Pogo, HBO or CNN, the distinction we bring to the table is the solution providing techniques or approaches we have.
With CNN, for example, we did this exercise with the department of tourism. We created six films for them where we needed to identify certain genres to highlight facts about Indian tourism in the international market. Such initiatives make the difference.
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With the news channels space opening up in the last couple of years, how is CNN perceived in the market versus earlier when there was not much competition in India?
I think the perception is still the same that CNN is a global leader. CNN clearly brings that value to the table wherein it is an international news channel. We are not even in the space of competing with Indian channels and we don’t consider them as competitors. Our position is clearly distinctive and the clients we go and talk to are the people who are looking for international audiences and not so much the Indian audiences. That’s where the clear distinction lies.
For us, it’s not about what the other news channels are doing because that’s not where we are placing ourselves. With all the surveys that we have done globally and at the Asia Pacific level, CNN is the clear leader in every aspect. That’s where our positioning stands and will continue to.
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What are the properties on each channels – Cartoon Network, Pogo, CNN and HBO – that you believe will drive revenues in the next fiscal?
We have so many of them. As a channel per se, when you take kids into account, Cartoon Network will have a clear focus on better content coupled with marketing support, more communications techniques and mediums. Between Cartoon Network and Pogo, that’s where the consolidation will happen.
For HBO again, better content and hence better integrated solutions to clients will be able to drive growth apart from the rate increase that will drive revenues. The same goes for CNN as well. The strategy remains the same.
For Cartoon Network and Pogo we have defined three pillars, which are: content, creativity and choice. This will be coupled with innovation as well.
So if we say content is king, then innovation is key. That is important because in today’s dynamic environment where there is so much of choice, if you’re not going to be different then you will be left behind. So, how you make yourself different is not found in just one big Black Book. The difference lies in every aspect of how we do our business.
In Cartoon Network and Pogo’s case, we’ve been around for the last 10 years and in these 10 years we were in a monopolistic environment so we were obviously number one then. But even in a multi-layered environment we have still maintained our leadership position.
Therein lies the answer and speaks volumes about our credibility and what we bring to the table. We know the kids best, we listen to them and going by what we hear, we replicate what we have on-air. Those are the things which will continue to be our focus in the coming years.
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You have recently been given added responsibility of overseeing programming, marketing, production, research and licensing to drive Cartoon Network and Pogo’s business initiatives and revenue growth. Are there any new initiatives or new revenue generating areas that you are looking at in the kids’ space?
Like I said, we believe we are our own competitors and we will be focused on what we think is best so as to take it to the next level.
New media is going to be a huge focus in India in the coming years. We will be seeing how we can leverage that — whether it is wireless or dotcom – and how we can integrate them in our portfolio.
Our products and licensing division too has huge potential. It is our philosophy that Cartoon Network and Pogo are super brands in the kids’ entertainment space and we have consolidated our position in the last 10 years. But how do we take our experience of television, outside of television is what this division will help us to. This will create multiple touch points for our brands. From television to a bus stop, mall, shop and a theme park, Cartoon Network will be omnipresent. At every level, wherever you are, your brand will be there and that’s the kind of experiential marketing is what we will be focusing on.
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When will the branded theme parks be ready in India?
We are launching Pogo Planet first by mid-next year and the Cartoon Network theme park will be launched by the end of 2007.
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What do you think about the recent buyout of Hungama by Disney? How will it impact the overall kids’ channels’ space in India?
Actually this consolidation is something that we were expecting. In fact, we were expecting it earlier. This doesn’t come to us as a surprise because when you have to deal with well entrenched players, you need things like this to happen.
That said and done, we will not change our strategy, our thinking and how we want to deal with our business. Those cannot be based on other people’s strategies or on changing market dynamics. We will do what we think is best for us because that’s where our forte lies. We will continue to re-invent and keep pushing the envelope as much as we can to maintain our leadership position.
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All said and done, Disney will now be in a better position in the space and Hungama is a strong brand. How do you see the kids’ channels’ market changing with this development?
I think fragmentation is a reality and that’s something every genre has experienced in these 10 years of the cable and satellite boom in the country. And what is interesting to know is that despite the fragmentation happening in the kids space, we are still maintaining our leadership position. I just want to reiterate to everyone that just don’t forget that we have been here for 10 years and you can’t overnight come up with something, which our experience has build for us.
Secondly, in a fragmented environment, managing leadership position is a challenge. So while people have come in and taken a bit of share, within that itself we are in the number one and two positions. In terms of audience shares, the analysis that we do is based on what the industry benchmarks are in terms of a 24 hour channel share. You can’t have an analysis based on specific markets and time bands and say you’re number one!
While we are still the leaders, we are not being complacent about it. We are rolling out many new initiatives and of course our biggest launch this year is going to be Galli Galli Sim Sim. That’s taking the whole association with Sesame Workshop to the next level. It is going to change the whole game, not only in terms of television viewing but also in terms of education in the country.
These things are only going to consolidate our position in the kids’ channels’ space.
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Have you seen any new brands/categories coming in the kids space?
Over the last few years we have seen a huge shift of focus in brands that we used to call originally non-traditional advertisers, who one would have thought would not come on to a television channel — whether it is the banking sector, financial sector or personal products. Now over the last year or so, the lines between the traditional and nontraditional have blurred.
Even now about 35 per cent of my audience base is adults. So, we are talking to them too and you will see a lot of advertisers who are not just selling confectioneries, sweets and candies. We have grown our advertiser base and that’s where the opportunity lies – how do you increase the pie by tapping into other genres of advertising.
Clients like L’oreal, TVS, Citibank, ING Vyasa, P&G and Levers brands like Clinic All Clear and Surf have come on to our kids’ channels.
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And what about HBO?
HBO again has seen a huge shift in advertisers. The base has expanded. Telecom and financial sectors have been new additions, which we have managed to pull away from the English news genre. |
What are the challenges involved in selling a channel where decisions are based to a degree on perception in the absence of high ratings as in HBO?
It is about managing perceptions and managing clients’ expectations. These are key to brands like HBO. As you rightly said, these are not sold on ratings but on the environment you’re buying into, the value you’re bringing for the brand and on how you’re able to differentiate the buy on the channel versus a rating driven channel.
Relationship building is another important aspect in the market, which is a big connect that we have in the market across all the brands we represent. While HBO has been a recent entrant in our lives, between Cartoon Network and Pogo, we have built many relationships in the industry. Our aim is to always find ways to consolidate our relationships in the market.
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