Tata Sky changes ad-revenue model

The advertisement revenue model on the direct to home (DTH) platform is changing in the country. Tata Sky, which has 1.8 million subscribers and claims to offer the largest amount of interactive content among the DTH players in the Indian market, has moved on to a new ad-revenue earning model. It is making a shift from the ‘flat fee’ model to the ‘cash per lead’ model for advertisements, which in simple words mean that while advertisers used to pay a flat amount for their ads for a specific duration, say Rs 10 lakh for 10 days, to get their ad beamed on the platform, now they will pay for the number of consumers who have shown interest in their products.

Companies like Samsung, Whirlpool, Tata Teleservices have already opted for the cash per lead model where details of their product are beamed for Tata Sky customers in form of two to three static pages and if the consumer is interested in the product, he/she is asked to send an SMS back to a number. For every such SMS generated, Tata Sky is charging the advertiser.

“We have introduced this new ‘cash per lead’ model on our interactive platform in January 2008. The core strength of this model is that the advertiser doesn’t witness any wastage. This model closes the loop as advertisers end up paying for only those customers who have evinced genuine interest in their product. It also drastically reduces their cost on advertisement,” Vikram Mehra, CMO, Tata Sky told FE. Tata Sky is in talks with segments like car manufacturers, telecom operators, mutual funds, insurance products and personal computer who have shown keen interest in the new model.

“Basically all products which have to communicate in greater details to the consumer will tremendously benefit from this model. Today, Tata Sky caters to 91% of DTH subscribers in Sec A and Sec B cities. That is the target audience for many niche products. Since the concept of cash per lead is new, the ad space buyers are also trying to understand it. But the response so far has been very encouraging.” Currently these ads are in form of static pages but Tata Sky plans to offer space for video ads in near future.

Source: financialexpress.com