TFCTHE FASHION CHANNEL

DANA’S CLUE

AN OVERVIEW OF THE CHANNELCONSUMER & MARKET ANALYSISFINANCIAL ANALYSISDANA’S SELECTED SEGMENTATION PLANREVISION OF SCENARIO 3OUR FORECASTQUESTIONS AND ANSWERS

THE FASHION CHANNEL’S CASE STUDY

BROADCASTI

NG

TO ALL

PUBLICS

7 DAYS 24

HOURS

FASHION

DEDICATED

NETWORK

THE CHANNEL

FOUNDED IN 1996

US BASED

UP TO DATEENTERTAINING FASHION FEATURESINFORMATION

SOLO PLAYER COMPETITORS MARKET LEADER

TIMELINE OF TFC

CONSUMER AND MARKET ANALYSIS

MAIN SOURCES OF REVENUE

ADVERTISEMENT 230.6M$CABLE AFFILIATE FEES 80M$

THE 30%of viewers are between18-34 years old

FASHIONISTAS

PLANNERS & SHOPPERS

SITUACIONALISTBASICS

EXPENSES

20B$ SPENT IN BUYING SPOTS

IDENTIFY TARGET MARKET THAT IS FASHION-ORIENTED

GENERIC AUDIENCE

HIGH INVOLVEMENT

LOW INVOLVEMENT

FASHION ORIENTED AUDIENCE

UNDERSTANDING OUR COMPETITORS

LESS APPEAL LESS VIEWERS

TIME TABLE PERCEIVED VALUE & CUSTOMER

SATISFACTION

WEAKNESSES

TFC

24x7

PV: 3,7CS: 3,8

NO SEGMENTATION AT ALL

LIFETIME

M-F 9-11 PM

PV: 4,4CS: 4,5

LACK OF FEATURES

CNN M-F 8-9 PM Sat-Sun 10-

11PM

PV: 4,1CS: 4,2

VERY HETEROGENEOUS AUDIENCE

Total Revenue Ad Sales Net Income$0.00

$50,000,000.00

$100,000,000.00

$150,000,000.00

$200,000,000.00

$250,000,000.00

$300,000,000.00

$350,000,000.00

2006

2007 Base

FEASABILITY FORECAST (2007)DOWNWARD TREND IN ALL VARIABLES

SHARP DECREASE BY NEARLY 50% IN

THE NET INCOME

DECLINE OF AD SALES

FINANCIAL ANALYSIS

YEAR 2006 2007 BASE

AVERAGE RATINGS 1% 1%

AVERAGE CPM $2.0 $0.8%

PROFIT MARGIN 30% 19%

SOME OTHER SIGNIFICANT VARIABLES

DECRESASE OF PROFIT MARGIN DROPS 11%

DECREASE IN REVENUE CPM DROPS 10%

INCREASE OF TOTAL EXPENSES RAISE 15M$ IN MARKETING AND ADVERTISEMENT

FAILURE TO RAISE RATINGS

 PROS CONS

SCENARIO 1 FashionistasPlanners & ShoppersSituationalist

Rating boost in 20% Low incremental

programming expense Follows the initial TFC

mission Lowest fiscal risk 

CPM will remain same as before

Non-segmented group 

SCENARIO 2 

Fashionistas

Increases revenues (and ad revenues)

Highest CPM

Low rating Drastic segmentation

SCENARIO 3 

FashionistasPlanners & Shoppers

20% more ratings boost Stronger connection with

cable affiliates Less risk of being dropped Balance of two segments Targets the right audiences Margin of 39% Highest net income Higher competitive CPM

price

Highest cost of programming expenses

High investment expenditures

 

POSSIBLE SEGMENTATION STRATEGIES

• HIGHEST MARGIN• HIGHEST NET

INCOME• INCREMENT OF

RATINGS• INCREMENT OF

VIEWERS• GOOD CPM

FINANCIAL RESULTS

• HIGHLY FOCUSED IN FASHION

• GOOD AMOUNT OF THE MOST PROFITABLE VIEWERS

QUALITY VIEWERS

SCENARIO 3

DANA’S SELECTED SEGMENTATION PLAN

NEW SEGMENT: TEENAGERS (15-18 YEARS OLD)

ADD SPECIFIC PROGRAMS FOR OUR TARGET VIEWERS

INTRODUCE SOCIAL MEDIA

CUSTOMER SURVEY & FEEDBACK FROM THE NET

REVISION OF THE SCENARIO 3

PRIME TIME

NEWS & TRENDS

PROGRAM FOR TEENAGERS

PROGRAMING SCHEDULE

OUR FORECAST

INCREASE IN RATINGS

CREATION OF TEEN CUSTOMER

LOYALTY

INCREASE IN CPM

INCREASE THE NUMBER OF VIEWERS INTERESTED IN FASHION

THANK YOU

Dalma RicciLuca FlaminiGiulia VenturiIlaria CascioneCristina Muñoz

Roberto AlbanesePhuong Ly Ly

Nguyen

Q&A