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Discovery Channel - Discovering India

"Discovery India has to rework its brand positioning. We've to reorient our image.

Science and history programs will be publicised more."

- Kiran Karnik, Former MD Discovery Channel, India, in 1998.

"Discovery is in the infotainment genre while National Geographic is all about wildlife."

- Pio Linhares, Media Supervisor, HTA, in 2001.

"The biggest challenge is to get Discovery out of the niche arena. We plan to positionDiscovery in the mainstream market. Because it is a mainstream channel"

- Deepak Shourie, MD, Discovery Channel India, in 2001.

Reaching Out to Indian Viewers

In October 2002, readers of'India Toda4,'a popular weekly magazine in India weresurprised to receive a program guide of Discovery Channel (Discovery) along with themagazine. The program guide provided information on Discovery's programs for thecoming quarter.

Along with programming information, it provided a programsummary. The program guide was in the form of booklet that

could be pulled out from the magazine and retained by the

consumer.

This move was aimed at familiarizing Indian viewers withDiscovery. According to channel sources, a market research

survey revealed that while viewers loved to watch Discovery;they were not aware of its programs and their broadcast

timings.

Sanjay Raina (Raina), Associate Director, Marketing, said,"The booklet is laid out in an easy-to-use manner, so that

consumers can plan their viewing on Discovery by flipping

through its pages and locating the different time bands."5

Discovery Channel - Discovering India - Next Page >>>

1] Interview with Kiran Karnik, www.rediff.com, August 14, 1998.

2]National Geographic Inches Ahead of Discovery, www.agencyfaqs.com, March 16,
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2001

3] Interview with Deepak Shourie, www.agencyfaqs.com, September 3, 2001

4] India Today is one of the leading current affairs magazines in India.

5] Discovery Banks On Innovation to Announce Its Programming Line Up,www.agencyfaqs.com, October 4, 2002.


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6] Mitsubishi Corporation, a Japanese company, has a very diverse business portfolio. Ithas got a presence in Energy,

Metals, Machinery, Chemicals and Living essentials.

7] A video application is interactive if the user influences the flow of the video and thatinfluence, in turn, affects theuser's future choices. This means that the application does not simply feed the user clipsof video while the user sitsidly by and watches what is presented. While the video is being presented, the user must be provided an opportunityto give the program that controls the video input that would determine what would beshown next. Furthermore, thechoice of video shown, based on the user's input, must affect the user's future choices.

Discovery Channel - Discovering India


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In the same year it entered Turkey through a partnership agreement with The MediaGroup. In March 1997, DCI entered into a joint venture with British BroadcastingCorporation (BBC)10 to launch BBC America. Discovery was the first network to targetchannels at different viewer segments to increase viewership and cater to the viewingneeds of different viewers.


8] Total Research Corporation conducts EquiTrend Research to measure the brand equityof brands across variouscategories.

9] The National Geographic Society publishes the National Geographic Magazine. National geographic Magazine wasone of the most popular media brands across the world.

10] Established in 1922, BBC is considered one of the pioneers in news broadcasting.

Background Contd...

To suit the needs of different viewers, Discovery offered The Science Channel,Discovery Civilization Channel, Discovery Home & Leisure Channel, Discovery WingsChannel and Discovery En Espanol (Refer Table I for the profile of these channels). By2002, Discovery channel became the world's most widely distributed television brand.Discovery channel was aired in over 155 countries and had around 700 millionsubscribers (Refer Table II for its Global Presence). The 14 entertainment brands of DCI

were distributed through 33 networks in around 33 languages all over the globe (ReferTable III). Along with launching various infotainment channels, DCI sold educationalproducts and services based on its television programs to consumers through itsDiscovery Consumer Products Division to leverage its brand name and provideinnovative products to students (Refer Exhibit II). Discovery success was attributed to itsprogramming mix and its marketing strategies. However, in India, Discovery faced theproblem of positioning itself in the viewers' mindset. In India, Discovery was perceivedas a specialty channel airing programs on wildlife and nature.

Discovering India

When Discovery entered India in 1995, the Indian televisionmarket was dominated by entertainment channels which

provided family soaps and film-based programs to viewers.Discovery was the first channel to provide infotainment

programs in India. It aired programs related to Nature, Wildlifeand Science & Technology in English. Discovery wassuccessful in attracting viewers; in the first year of its
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operations it reached 3 million homes.

The reasons for its success were:- Its innovative programs, which gave viewers a break from

routine family dramas aired on entertainment channels inurban areas.

- Parents, who were concerned about the influence of TV on children. They liked thechannel's informative programs, which had a positive influence on children.

In mid-1999, Discovery became a pay channel, charging around Rs 5 per household.Subsequently the number of households receiving Discovery went down to 8 millionfrom 13 million in the first quarter of 1999 as operators stopped airing the channel.


Discovering India Contd...

However, with consumers demanding the channel, cable operators were forced to resumeairing the channel. As a result, the number of households receiving Discovery increasedto 12 million within 6 weeks. Though Discovery aired a variety of programs covering awide range of subjects, such as Nature, Wildlife, Science & Technology, Culture andCivilization, Indians perceived it as a channel airing programs on nature and animals andregarded it as an educational channel. Commenting on the channel's brand image in India,Kiran Karnik (Karnik), former MD, Discovery India, said, "Discovery India has torework its brand positioning."

Karnik announced that the channel planned to undertake anextensive advertising and brand building exercise to change itsbrand image in the country. Discovery also announced that itwould try to enhance its reach in India. In order to reach more

viewers, Discovery tied up with Doordarshan (DD)11 to airDiscovery programs in Hindi12for two hours on DD. This

move helped Discovery reach people who did not understandEnglish.

However, Discovery soon realized that though these programs

were successful in the northern states of India where Hindiwas the popular language, in the southern and eastern parts of

India, where the regional languages were more popular, itcould not attract viewers through its Hindi language programs.

In order to increase its penetration in South India, Discovery decided to launch itsprograms in regional languages. In 2000, it entered into a revenue sharing agreement withVijay TV13 to provide two hours of Discovery programs in Tamil. Under the agreement,
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both channels shared the revenues earned through sale of advertisement slots during thebroadcast of Discovery programs.


11] Indian State Broadcaster, reaching around 70 million television homes in India.

12] One of the official languages of India

13] Popular Tamil (state language of Tamil Nadu) Television Channel.

Discovering India Contd...

In December 2000, Karnik announced his resignation and Deepak Shourie (Shourie) tookover as MD of Discovery India. By 2001, Discovery realized that Indian viewers'

perception of the channel had not yet changed they still perceived it as a niche channelairing programs on wildlife and nature.

Changing Perception

After Shourie took over as MD, he commissioned a market research to find out howIndian viewers perceived Discovery. The research highlighted the following points: Discovery channel viewers consisted of mostly urban males between 25 54 years. Around 60% of its viewership was from the SEC A and B.14

Discovery was very popular with kids and their parents.

According to the study, the channel needed to pay moreattention to its image and its communication with viewers to

improve its performance in India. The study revealed thatviewers loved to watch the channel but were not aware of

program content and unclear about broadcast timings. Shouriesaid, "Discovery gives you so much from travel to adventure

to medicine to understanding sex, to murder mysteries.

So the first issue was to communicate the sheer width andintense variety of the programming on Discovery."15 The

second issue was changing the image of the channel.Discovery was regarded as a serious channel with infotainmentprograms.

However, according to channel sources, unlike its image, Discovery offered a variety ofprograms covering a range of subjects and topics, such as Junkyard Wars (two teamscompeting to be the first to build a machine out of scrap found in a junkyard), Fabulous
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Fortunes (this program explored the sources of wealth in the 20th century) andUnderstanding Sex (this explored the origins of sex) etc.


14] The Market Research Society of India (MRSI) does Socio-Economic Classifications(SEC). MRSI identified eight SECs,by grouping households according to the education level and the occupation of the chiefearning member. The eightcategories are labeled as A1, A2, B1, B2, C, D, E1, and E2. A1 denotes the upper-mostSEC, and E2 stands for thelowest SEC. The groups SEC A and SEC B represent educated urban consumers, makingup 5.88 million households insixteen cities. More than 75% of SEC A and B homes are in eight cities of India. Theyreceive the greatest attention in

respect of trendy and lifestyle products.

15] www.agencyfaqs.com, September 3, 2001.

Changing Perception Contd...

In August 2001, to address the above two issues, Discovery announced newprogramming strategy with around 118 hours of new programming per week. Thisstrategy was implemented in October 2001. The new strategy 'My Time on Discovery'-was based on viewer needs and viewing habits. Commenting on the new programmingstrategy, Shourie said, "The concept of 'My Time on Discovery' recognizes the viewing

convenience of each family member individually and collectively, by giving them whatthey want from Discovery at the time that they want it, while still catering to the familyas a whole.

In this way the new viewer response will be `Discovery is amust watch for me', and in the process provide advertisers a

focused platform to reach out to their key target groups."16

According to channel sources, the new strategy was also aimedat attracting advertisers. Shourie said, "We've achieved critical

mass, and now the objective is to monetise the existing

viewership."

Discovery introduced programming blocks targeting differentviewer segments on the basis of broadcast time. Time bands

were introduced on the basis of the viewing patterns ofviewers across all age groups.
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In August 2001, Discovery announced the launch of six time bands Sunrise (Weekdays7 a.m to 9 a.m), Discovery Kids (Weekdays 3 p.m. to 4 p.m.), Action Zone (Weekdays 4p.m. to 5 p.m. with a repeat at 11 p.m.), Prime Time (Weekdays 8 p.m. to 11 p.m.),Friday Showcase (9 p.m. to 11 p.m.) and Super Sundays (7 a.m. to midnight) (ReferExhibit III). In April 2002, Discovery extended its six time bands to nine bands with the

introduction of Woman's Hour (Weekdays from noon to 1 p.m.), Amazing Animals andLate Night Discovery. According to analysts, the new strategy highlighted the range ofprograms offered by Discovery and also differentiated the Discovery channel from NGC.Analysts felt that with increasing competition from NGC, Discovery was forced todifferentiate itself from the kind of programs offered by NGC.


16]Discovering Change, The Hindu Business Line, August 13, 2001

Changing Perception Contd...

However, Discovery sources did not acknowledge that NGC was their competitor.Shourie commented, "National Geographic is more nature oriented. We have a muchwider range." Along with new programming blocks, Discovery also came up withinnovative programs. One such innovative program was 'World Birth Day,' whichdepicted the preparations that take place before and after the birth of a child. The programshowed the emotions of mothers-to-be in nine different countries, who gave birth on thesame day.

The program aimed at capturing aspects of different cultures

and customs connected to the birth of a child. The channel alsolaunched India Hour, (aired on Sundays), which aired

programs on India and its culture.

Discovery also announced the launch of programs such asTech Tuesday, which targeted people interested in

technological developments such as spy gadgets, smart bombs,and Trauma, which depicted the medical emergencies.

According to reports, Discovery's programming strategy wassuccessful. By August 2002, its viewership among women

increased by 21% and among kids by 22%. In the prime timeband its viewership increased by 43%.

Marketing 'Discovery'

Along with program restructuring, Discovery focused on marketing initiatives to enhanceits image among viewers. It conducted a yearly audio-visual quiz contest for school
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students across India to increase awareness about the channel among kids. The contestwas hosted by India's popular quizmaster, Derek O' Brian. The quiz covered fivecategories of Discovery's programs Science & Technology, History, World Culture,Human Adventure and Nature.

Analysts felt that by conducting quiz contests for students, Discovery was able toincrease brand awareness among children and gain more market share. In August 2002,Discovery also conducted a contest for students. To do so, it entered into tie up withCanon India Ltd., (wholly-owned subsidiary of Singapore-based Canon Singapore PteLimited).

Marketing 'Discovery' Contd...

Discovery's executives conducted imaging contests in around 75 schools in seven cities(Delhi, Chennai, Bangalore, Mumbai, Hyderabad, Pune and Ahmedabad). Analysts feltthat this contest helped the channel increase its brand awareness among children and

increase its viewership ratings. Discovery also conducted Discovery Exhibition, wherein,students from Classes VI to IX watched the channel's program 'Popular Mechanics forKids'and created things under teachers' directions. This was conducted by Discovery inassociation with Colgate Dental Cream to create awareness among children about thechannel's programs.

Discovery also came up with the novel concept ofprogramming guides to provide information about Discovery

programs for every quarter. The first program guide waslaunched in association withIndia Today magazine in August

2002. In April 2003, Discovery entered into a tie-up with

Businessworld17 to provide a programming guide for the periodApril June 2003.

It also used direct mailers to inform viewers of the channel'sprograms. Discovery also conducted contests to attract viewersto channel. In April 2003, it launched the 'Win With Discovery

Channel Contest.'In this contest, viewers were expected toregister online or e-mail their particulars to the Discovery

channel.

Discovery channel entered the name of the viewers in its database and held a lucky draw

every month (the contest covered a period of 3 months). The lucky draw winner wasawarded numerous prizes. Discovery also advertised extensively in the media to enhanceits brand image and increase its brand awareness. It advertised through televisionchannels (Refer Exhibit IV) and the print media. In the metros it also used outdooradvertising.

Consolidating The Presence
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Discovery announced that it would bring in new programs to consolidate the gains madeby the new programming strategy.


17] India's popular weekly business magazine.

Consolidating The Presence Contd...

It planned to source world-class programs from Discovery's 14 channels across the globe.Analysts pointed out that none of the programs were produced in India by Discovery.Commenting on why none of the Discovery programs were produced in India, channelsources said that producing one program for Discovery cost around $1.5 million and thatrevenues in India did not match the costs incurred for producing programs. According toShourie, "If you incur that kind of cost, the revenues just don't come in India." In 2000,

NGC entered into a distribution and marketing agreement with STAR network in India.

According to analysts, this move helped it successfullyincrease its reach. It was reported that while Discovery was

strong in northern India, NGC was strong in South India.

To increase its presence in South India, Discovery announcedthat it would launch a 24-hour feed in Tamil. In March 2002, itsnapped its ties with Vijay TV and announced that it would airTamil programs in the family time band (8 p.m. to 10 p.m.) on

weekdays.

It was reported that the channel would offer programs on thebasis of themes history on Monday, science on Tuesday,

forensics on Wednesday, health on Thursday and premiers onFriday.

Commenting on the channel's decision, Shourie said, "With Tamil, we hope to capture alarge Tamil-speaking viewer base to the channel and expand viewership in south India."In June 2002, in order to enhance its distribution reach, Discovery entered into a jointventure with Sony Entertainment Television (Sony), known as SET Discovery, with anequity structure of 74:26.

The majority stake was held by Sony. Commenting on the joint venture, ShantonuAditya, Head (Distribution), SET India, said, "With Discovery joining our existingbouquet of channels, the One Alliance partnership,18 announced earlier this year, is inplace to offer viewers an enhanced genre of programming supported by combineddistributed strength.

We are now strategically positioned to be the No 1 television network in the country."
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According to reports, the alliance would help Discovery increase its reach from around21 million homes (in 2002) to around 28 million homes.


18] The One Alliance brand consisted of a bouquet of six channels, including Sony, SonyMax, AXN, Discovery, CNBC andAnimal Planet, for Rs 40 per subscriber.

Discovering The Future

Through its alliance with Sony for distribution and marketing, Discovery announced thatit expected to gain a 50% increase in both advertising and subscription revenues. Thechannel announced that in the year 2002 around 330 brands had advertised on the channeland that the channel had registered a 50% increase in ad revenues. According to analysts,

Discovery's decision to air programs on the basis of viewership patterns helped it attractadvertisers. In order to consolidate its position, in January 2003, Discovery announcedthe launch of a new series The Blue Planet, which explored under water life. Thisprogram was co-produced with BBC and it took 5 years to complete the series at a cost ofaround 7 million pounds.

Along with Blue Planet, Discovery also announced the launchof new programs such as, Special on World War II, Bismarck,Great Romances of the 20th Century, and Kitchen Chemistry

etc.

Discovery also announced the launch of a new program seriesin January 2003, featuring around 18 films made by world-

renowned producers. The films would be aired in April, Mayand June 2003.

Some of films to be aired were, Great Cats of India, Himalayas Descending India, Immortal Capital Many Cities of Delhi,

Arthur C. Clark's Mysterious India, Konarak - Chariot of theSun, Wild and Dangerous and Buddha's Mountain Wilderness.

However, analysts were skeptical about the channel's future in India. They felt that with

even NGC announcing that it would air new non-wildlife programs on its channel, itwould be very difficult for Discovery to increase viewership. Discovery also faced stiffcompetition from specialty channels such as Cartoon Network, CNBC and CNN, which,though they offered a different genre of programs, attracted viewers to their channels.Will Discovery garner more revenues and increase its viewership base in India? Onlytime will tell.
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Exhibits

Exhibit I: National Geographic ChannelExhibit II: Discovery Consumer Products DivisionExhibit III: Discovery India Time Bands

Exhibit IV: Discovery Channel TVC

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