Life OK’s gr8 start with 87 GRPs (report + analysis by Stratagem)

29 Dec,2011

By Rishi Vora

 

While it may be still early days to declare Star India’s new channel Life OK as a success story in the Hindi GEC market, there is no doubt that it has delivered on the network’s goal No 1, which was to make an impact on the industry.

 

The primary objective, as cited by a few industry observers, is to compete with the Sony and SAB TV combo, so that Star as a network could have a commanding position in a market which is now seen as hyper-competitive.

 

So Life OK has clocked 87 GRPs in its first week, surpassing Colors’ 81 GRP launch back in July 2008. It may be recalled that Colors had left no stone unturned for the launch. The strategy was to start with the big-ticket show Khatron Ke Khiladi (with film star Akshay Kumar in a way giving a solid push to the channel), aggressive marketing, fiction shows, mythology, so on and so forth.

 

One may argue that Colors was launched as the flagship channel of a joint venture company of two broadcast majors – Viacom and Network 18. Life OK in that sense is Star India’s second offering in the Hindi GEC sector. But, that has very little to do with what the channel has achieved in the first week as Star officials say that the idea is to compete with every channel in the market, it doesn’t matter if it means competing with elder sibling and No 1 channel Star Plus.

 

An interesting observation: Imagine and 9x were launched in the same year (2008) and registered 55 and 21 GRPs respectively. Both the channels gradually grew in GRP terms, but as the market became competitive, the going for both channels became tough. While Imagine is still around (currently placed at No 7 with 67 GRPs), 9x may be on air, but even though it has been acquired by Zee, it has failed to create an impact . Of course there are several reasons attached to why the channel tasted early success and witnessed one of the most dramatic and talked-about downfalls.

 

As for Life OK, its success at this stage can be attributed to the following: A sensible approach to launch the channel with a unique philosophy, marketing blitzkrieg (it is reported that Star India made an investment upwards of Rs 700 crore to launch the channel. The campaign, which is in full swing now, saw a three-day roadblock across Star India’s network, an outdoor plan reaching 100 towns, a week-long digital engagement programme which included an eight-hour-long concert, and of course getting Madhuri Dixit as the Sutradhar (storyteller). Plus, the fact that the channel did not bank on one particular show to deliver, and rather offered viewers a package of differentiated programming, the strategy to cut down on advertising inventory – all these factors put together have produced rich dividends.

 

Official comments from the senior members of Star India and Life OK could not be obtained at the time of this report. However, industry observers believe that Life OK has what it takes to be a serious contender in the Hindi GEC market.

 

Ashish Bhasin, Chairman India and CEO South East Asia, Aegis Media, observed, “Life OK as a channel has great potential.  However, the true test of a channel is after it has settled down for a few months. It is sometimes easy to get content for a short period but sustaining it on an on-going basis becomes a challenge. Ultimately, in my view, content drives the fate of any channel. If Life OK is able to sustain good quality content on an on-going basis for two or three years, it can definitely become a serious player. On the other hand, if the quality of the content starts to drop after the initial launch, then it’ll have a struggle ahead for itself.”

 

Havas Media CEO – India and South Asia Anita Nayyar said, “With the kind of marketing backup and hype, the opening seems good and certainly a hike from the Star One deliveries. However, two-three weeks of sampling will continue and the actual stability will start setting in after a few weeks. Coming from the Star Network, the programming quality is very good.”

 

On whether it will pose a challenge to the top players – Star Plus, Sony, Colors and Zee, she said, “It will be a strong competition in the GEC category for the No 3, 4 and 5 slots. Not sure about whether it will be another success story as big as Colors, as it had the advantage of differentiated content on the social platform when it launched. The content is interesting and should help stabilise around 60-70 GRPs from here.”

 

In an earlier interview to MxM India, Star India COO Sanjay Gupta had mentioned that the No 4 position in the GEC line-up (currently held by Zee) would be a first good milestone to look at. In week 52, Zee is at 208 GRPs. Though he did not put a timeframe, going by what experts have to say, the channel will need to pick up on its early momentum and get there by bringing differentiated content – something Colors did very successfully.

 

While Imagine has slipped to No 7 position and SAB is at No 5 with 122 GRPs, it looks like a serious battle from here on.

 

An analysis by Stratagem Media Pvt Ltd on the launch of Life OK.Background 

It is a jungle out there in the media business. If you win the battle, you still have to worry about losing the war. Recently the Star Network launched another GEC called Life OK. Probably in the wake of competition from the Sony and SAB TV combo.The table 1, below depicts that the Sony and SAB combo was just about edging out Star Plus from the top GEC position, especially if it came at a more attractive rate (CPRP), as estimated in the table below.So, the not-so-hidden agenda of the Star network for Life OK would be to combine it with Star Plus and thereby fend against the Sony + SAB offensive, but without devaluing their trump card (i.e. Star Plus itself). Therefore, how would the new channel Life OK have to price itself, to overcome the Sony + SAB threat?

 

Stratagem Media has undertaken a simple exercise to answer this question, for different levels of performance of Life OK.

 

 

Objective of the exercise: To derive the CPRP Index of Life Ok @ different level of GRPs, if the CPRP of Star Plus is 100?

 

Methodology: If the CPRP of Star Plus is 100, then what should the CPRP of Life OK be, if they have to match the CPRP of the Sony + SAB combo at different GRP ratios between the 2 channels.

 

In the exercise below, the ratio of GRPs purchased between Life OK and Star Plus is assumed to improve in favour of Life OK, as its performance improves.

 

 

*At these CPRPs, the Star Plus and Life OK combo will be as cost-effective as SET and SAB combo.

 

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