Growth of Private FM Radio in India

Details

Case Code : CLMC-008
Publication date : 2005
Subject : Marketing Communications
Industry : -
Length : 04 Pages
Price : Rs. 100

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Key words:

FM Radio, Initiative Media, Lowe Group, Radio Mirchi, Radio City, ACN ORG-MARG, Entertainment Network India Ltd (ENIL) and Indian Listenership Track.

Note

1: This caselet is intended for use only in class discussions.
2: More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US $16) per copy.

 

Abstract:

The caselet examines the nature and growth of FM radio in India. It provides details of one of India’s leading private FM radio operators - Radio Mirchi, its operations and business strategy. The caselet also describes the sales promotion campaigns developed by Radio Mirchi to provide an experience to the target audience, especially the youth, and position it differently from the other FM players.

Issues:   » Online advertising as a new tool for effective marketing communications   » Leveraging Internet connectivity in India, to promote products and services Introduction The online advertising industry, which was once written off by the advertising industry, has gained ground over the past few years. The industry was pegged at Rs 500 mn in 2004-05 and has grown steadily at a healthy annual rate of 15-20% since 2002 . The growth can be attributed to the increase in usage not only by traditional users like e-commerce sites and financial services, but by companies across different categories ranging from FMCG, consumer durables and home appliances, films and entertainment.

One of the earliest non-FMCG companies to successfully venture into online advertising was Pidilite Industries, the brand owner of adhesive brand Fevicol, in 2002. The company had a tie-up with Yahoo, and launched a microsite -- fevicol.yahoo.co.in. The site carried an innovative online contest --‘Fevicol Kya Idea Hai’, where the consumers had to select the three best ad campaigns from the six award winning ad campaigns of Fevicol. Speaking about the brand’s online advertising strategy, Punit Mehra, Head – Marketing, Pidilite, said, “Due to the nature of the product, Fevicol has to communicate to both the carpenters on one end of the spectrum and actual users of the furniture on the other.

Questions for Discussion:

1. Radio Mirchi is the leading FM channel operator in India. What benefits would Radio Mirchi offer to advertisers as an alternative to other traditional advertising media?

2. Advertising is one of the major sources of revenue for a radio channel. How can Radio Mirchi ensure that its programming and promotional efforts help increase its ad revenues in the best possible manner?

3. What challenges do FM players in India have to face to increase revenues and sustain profitability?