Sep 13, 2008

Business - Niche channels outsourcing ad sales duties

The trend began with NDTV setting up NDTV Media. The full-service company that was formed to manage ad sales for NDTV's own channels later went on to shoulder the duties of Sahara's entertainment channels as well, in lieu of a commission fee of course.Soon after, NDTV Media also started servicing regional channels such as Mi Marathi and Just TV Punjabi. Sensing the huge opportunity — regional television advertising is about 24% of total TV advertising market— an independent player Integrid Media also entered the space about a year back. Twenty months on, Integrid Media — helmed by former UTV chief operating officer Anil Mishra — won the mandate to manage the ad sales duties for the country's first Bhojpuri channel Mahua TV. And by this time outsourcing of ad sales by niche media, which was seen as a one-off case in the start, had almost become a ritual. Mahua TV, which is a general entertainment channel targeted at a Bhojpuri population of close to 150 million, spent close to Rs 15 crore in marketing and buying airtime at the time of the launch. "It was an outsourcing arrangement. But it wasn't limited to mere ad sales. Our employees have a strong background in the television business, so we also provided inputs for programming, strategising and ideating media agnostic solutions," said Mishra. Mahua Media Pvt Ltd (MMPL) has also outsourced its ad sales duties to Integrid for its forthcoming channels — Mahua News and Mahua Music — slated to be launched in a few months. "Creating a fully-staffed, in-house ad sales team from scratch is proving to be a challenge for new players in the media business," said a senior ad sales executive with a general entertainment channel. "If it's a niche channel, then the pool of advertisers to tap into is shallow, making it challenging to continuously generate ad revenues from them at a time when everybody is gnawing at the ad pie." Experts say it makes a better sense if an outsourced entity handles ad sales for niche media. Going by the industry estimates, annual salaries from the bottom rung of a television channel's ad sales team could start from Rs 4-5 lakh a year going up to as high Rs 25 lakh per annum for senior management. The average size of an ad sales team would comprise of at least 6-7 members and the same number of people would be present in major ad markets. In contract, a specialist like NDTV Media team would have more than 250 professionals with an extensive experience in the Indian media market, many of whom would have held senior positions at premier television companies such as Star, Discovery Channel, ESPN Star Sports and Zee TV. Similar team sizes would be delegated for each channel, but the presence of several channels in the seller's kitty would give better negotiating power and value for advertisers and media planners. Chandradeep Mitra, president, Mudra Max, said, "Costs of maintaining a strong sales team are better rationalised in this manner. Unless you have a strong sales teams spread across the country, a specialist is a better choice.

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