Moser Baer: Hello movies
Moser Baer’s aggressive marketing and technological edge have made it the market leader in the home video market.
Till 18 months ago, Moser Baer did not need to face consumers too much. Its optical media business (CDs and DVDs) did not require any significant marketing effort. However, that changed when it diversified into the entertainment space. The company, one of the world’s lowest cost optical disc manufacturers, now also retails home videos across India in Hindi and other regional languages.
Changing a company’s DNA is not easy, but the opportunity was too huge to pass up. Statistics showed that in developed markets such as the US, the consumption of home videos was at least twice that of the theatrical consumption of newly released movies. “In India, however, the home entertainment market is barely 10 per cent of the theatre sales,” says Ratul Puri, Executive Director, Moser Baer. Clearly, there was tremendous headroom for growth, but rampant piracy, high cost of content and highly fragmented ownership of that content were impediments to the development of scale, distribution network and marketing presence.
The starting point, obviously, had to be content sourcing. Moser Baer kicked off its initiative in early 2007 by picking up the rights to over 10,000 titles across languages. It then started putting in place a massive Hindustan Unilever-type pan-India distribution network. “If our products are to be available at the price of a chocolate or toothpaste, then we had to be present at outlets where such products are available,” says Harish Dayani, Chief Executive, Entertainment Division, Moser Baer.
Since then, the company has expanded its reach to 150,000-plus outlets across the country and plans to scale this up to more than 500,000 points of sale over the next couple of years. Next, it proposes to push (literally) its wares to vendors on hand carts and cycle carts (akin to ice-cream carts).
Moser Baer backed this distribution effort with a massive brand building campaign, spending Rs 25 crore in the first year alone. This year, too, it will spend about Rs 20 crore to extend its “Hello Happiness” line further in second week of November.
The clincher, of course, is the pricing—at Rs 34-50 for Indian content and Rs 69-149 for foreign content, its prices are comparable and sometimes even lower than pirated products, but deliver much better, and consistent, quality. Here, its technological edge and manufacturing capabilities gave it a distinct advantage over its rivals.
The success of the strategy was demonstrated by films like the 15-year-old Bollywood superhit Baazigar, which sold 150,000 copies on first day of its release. Recent films such as Jab We Met and My Friend Ganesha have been other such runaway hits.
The challenges, however, remain significant. Despite Moser Baer’s obvious advantages, pirated content still commands a significant market share. The gargantuan numbers involved in the business model is another challenge. Therefore, in addition to its physical distribution model, it is also putting in place an online sales model. Next on the anvil is a plan to take its model overseas. “Why should a newlyreleased Hindi film not be available on the streets of New York at $2 against a pirated version at $4 or an original at $20?” asks Dayani. Why not, indeed?
—Shalini S. Dagar
Moser Baers Dayani
The starting point, obviously, had to be content sourcing. Moser Baer kicked off its initiative in early 2007 by picking up the rights to over 10,000 titles across languages. It then started putting in place a massive Hindustan Unilever-type pan-India distribution network. “If our products are to be available at the price of a chocolate or toothpaste, then we had to be present at outlets where such products are available,” says Harish Dayani, Chief Executive, Entertainment Division, Moser Baer.
Since then, the company has expanded its reach to 150,000-plus outlets across the country and plans to scale this up to more than 500,000 points of sale over the next couple of years. Next, it proposes to push (literally) its wares to vendors on hand carts and cycle carts (akin to ice-cream carts).
Moser Baer backed this distribution effort with a massive brand building campaign, spending Rs 25 crore in the first year alone. This year, too, it will spend about Rs 20 crore to extend its “Hello Happiness” line further in second week of November.
The clincher, of course, is the pricing—at Rs 34-50 for Indian content and Rs 69-149 for foreign content, its prices are comparable and sometimes even lower than pirated products, but deliver much better, and consistent, quality. Here, its technological edge and manufacturing capabilities gave it a distinct advantage over its rivals.
Challenge: To create a niche in the home entertainment industry where piracy reigns |
The challenges, however, remain significant. Despite Moser Baer’s obvious advantages, pirated content still commands a significant market share. The gargantuan numbers involved in the business model is another challenge. Therefore, in addition to its physical distribution model, it is also putting in place an online sales model. Next on the anvil is a plan to take its model overseas. “Why should a newlyreleased Hindi film not be available on the streets of New York at $2 against a pirated version at $4 or an original at $20?” asks Dayani. Why not, indeed?
—Shalini S. Dagar
