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Cost is key to rural FTA

News, 03 February 2017
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MUMBAI: The introduction of rural viewing data has encouraged marketers to include free-to-air (FTA) channels aimed at the rural market in their media plans, but broadcasters need to avoid increasing ad rates to too high a level, a leading marketer has warned.

Rajiv Dubey, Head, Media at Dabur India, explained to Best Media Info that FTA channels were second only to the GECs (general entertainment channels) in importance for the personal care business which derives 45% of its sales from rural areas .

"They offer huge reach and their importance has increased, especially after BARC has started giving out rural data," he said, adding that such data meant "we sometimes have plans purely based on FTAs – these channels are a very significant part of our marketing plan."

The fact that FTA advertising rates are significantly lower than those of their paid-for rivals is another attraction, although rates have increased following the decision to make rural data available.

Dubey suggested that this process still had some way to run, as BARC India only started issuing rural data towards the end of 2015 and a clear hierarchy of channels has yet to be established.

"The leader changes every month," he said. "A channel can only command rates if there is consistency to showcase. That is the only thing that will give us confidence to invest monies behind one channel over a period of time."

And he added there would be an upper limit to ad rates on FTAs. "The cost index of FTAs is such that the costs are about one-fifth of a mainline GEC," he noted. "If the rates go up, then the channels will lose their relevance of being cost-effective."

So far, that does not appear to be a concern at Sony Pictures Networks India, where Rohit Gupta, President, Network Sales and International Business, reported that "We have increased the ad rates every quarter, so in the last one year the ad rates have been hiked by about four to five times.

"It [FTA] is becoming a big segment," he added. "It might reach a size of Rs 2,000-3,000 crore a couple of years down the line."

CPT for a 30 second spot on Indian TV stood at INR217.2 in 2015, according to Warc's Media Costs Database.

Data sourced from Best Media Info; additional content by Warc staff

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