Radio Mirchi 98 (1) .3 FM Its Hot
Radio Mirchi 98 (1) .3 FM Its Hot
Radio Mirchi 98 (1) .3 FM Its Hot
PROJECT REPORT
ON
Strategy of
Radio Mirchi as compared
to other radio channels
In the
Strategic management
SUBMITTED TO :
Pr
of.Praneti Shah
SUBMITTED BY:
India has been among the fastest growing economies in the world,
with a nominal GDP CAGR of 9.94% over the last 10 years (1995-
2005). The nominal GDP for fiscal 2005 was Rs. 30,636 billion.
According to CSO estimates, nominal GDP growth for fiscal 2006 is
estimated at 10.9%. There is a correlation between the economic
growth rates of a country i.e. the nominal GDP growth rate, and
growth rates of the advertising industry.
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Segmentation of Advertising Spends
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The Indian television industry has grown rapidly, especially since
1991, which saw the beginning of satellite broadcasting in India.
This growth was also aided by the economic liberalization program
of the Government. The growth of the satellite television audience
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saw proliferation of a number of satellite television channels
offering more choices to media buyers and consumers of
entertainment. Thus, the television broadcasting business, which
started off as a single government controlled television channel,
now has over 300 channels covering the Indian footprint, resulting
in growing ad spends on this medium. Reforms and proliferation of
private players were the key reasons for this rapid growth of the
share of television in the advertising industry.
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Internationally, FM radio broadcasting is the preferred mode of
radio transmission due to its high quality stereophonic sound.
Industry Size
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The Indian government has already given 338 licenses for FM
radio channels in 91 big and small towns and cities. The current
size of the radio market is India is Rs 300 crores and is expected
to achieve the highest growth rate of 32 per cent in coming years.
The quality of the sound and the music has improved significantly
with the emergence and use of satellite radio. The audience
profile has also shifted to the high-income group. Local
advertising, lower amount of money spent by the companies to
advertise on radio is an added attractiveness for the players. All
India Radio (AIR) - the national service provider owned and
operated by the Ministry of Information and Broadcasting under
the Government of India - is the largest player in the industry.
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The share of Indian radio in the overall advertising pie at ~3% is
much lower than various developed and developing economies
worldwide.
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Key Players
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Radio Mirchi
"Mirchi" is Hindi for chili. The tagline of Radio Mirchi is "It's hot!".
The original avatar of Radio Mirchi was Times FM. Radio Mirchi
began operations in 1993 in Indore. Until 1993, All India Radio or
AIR, a government undertaking, was the only radio broadcaster in
India. The government then took the initiative to privatize the
radio broadcasting sector. It sold airtime blocks on its FM channels
in Indore, Hyderabad, Mumbai, Delhi, Kolkata, Vizag and Goa to
private operators, who developed their own program content. The
Times Group operated its brand, Times FM, till June 1998. After
that, the government decided not to renew contracts given to
private operators.
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Respondents
their percept
Grow ing steadily 15
Areas of operation
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• 98.3 FM - Pune Tagline - "Radio Mirchi - It's Hot" / Radio
Mirchi - Tikhat Aahe!
• 98.3 FM - Patna Tagline - "Radio Mirchi - It's Hot" /It is first
station of second phase.
• 98.3 FM - Jalandhar Tagline - "Mirchi Sunne Wale Always
Khush" & "It's Hot".
• 98.3 FM - Goa Tagline - "Radio Mirchi - It's Hot"
• 98.3 FM - Ujjain Tagline "Its Hot"
• 98.3 FM - Vadodara Tagline - "Mirchi Sunne Wale Always
Khush" & "It's Hot".
• 98.3 FM - Rajkot Tagline "Radio Mirchi - It's Hot"
• 98.3 FM - Raipur
• 98.3 FM - Varanasi - Services Started on 14 July 2007
• 98.3 FM - Lucknow - Services started on 14 August 2007
• 98.3 FM - Surat - Service started on 20 August 2007
• 98.3 FM - Nagpur - Service started on 18 October 2007.
Tagline- same as above
• 98.3 FM - Madurai - Service started on September 2007.It's
tagline is "Idhu semmma hot machchi !" (meaning 'It's too
hot'
• 98.3 FM - Mangalore - Service started on November 2007
• 98.3 FM - Vijayawada - Service started on December 2007
Tagline "idi chaala hot guru!"
• 98.3 FM - Vizag - Service started on October 2007 Tagline "idi
chaala hot guru!"
• 98.3 FM - Thiruvananthapuram- Service started on 28
January 2008 [1] Tagline: "Sangathi HOT aanu!"
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17% in Kolkata, 15% in Nagpur,10% in Bangalore and 02% in
Raipur. Radio Mirchi has started providing Visual Radio to its
subscribers in Delhi from 25 July, 2006 onwards and in Mumbai
from September 2006. It also has started its Visual Radio service
from Kolkata recently.
RadioMirchi,
TimesBusinessSoluti
BCGM
As per the Radio Audience Measurement Reports (RAM), Radio
Mirchi has been dominating in Delhi & is the leader in Mumbai and
Kolkata. However in Kolkata they are not clear leaders in SEC ABC
segments. The SEC ABC segments were earlier dominated by Big
FM & now by Friends FM. However in the SEC D & E segments
Radio Mirchi has total domination.
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Competitive Strengths
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Our FM radio stations are located in diverse regions in India and
we have been successful in attracting local listeners in each of
these markets. Our superior understanding of audience
preferences enables us to provide content that is customized to
the taste, language and culture of the local audience. We intend
to leverage this expertise to attract new listeners as we expand
our footprint to more cities and towns in India.
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second billing, providing services for production of advertisements
at nominal cost and offering our studio space for pre-production
work, which have helped strengthen our relationships with
advertisers and advertising agencies.
Strategy
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FM Radio Broadcasting Business
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revenue streams. We have already launched Mirchi Activation
events which are promoted through our radio channels and enable
us to enhance our revenue from airtime sales as well as attract
new advertisers. Additional income streams may also include
revenue from SMSs or calls received from our listeners, or from
the sale or licensing of content to third parties, whether in India or
in international markets. We have also recently provided
consultancy services to an industrial group in Bangladesh for
setting up radio stations. We have also entered into an agreement
with Hewlett-Packard India Sales Private Limited ("HP") to launch
visual radio services for the first time in India. With visual radio,
images and texts are synchronized with the radio broadcast to
bring information and interactivity directly to a mobile phone. As
part of this agreement we have an exclusivity period which will
give us the first mover advantage. Visual radio services also
provide an additional advertising opportunity to our clients. These
services also provide us with additional advertising revenues from
our clients as well as digital service revenues from the
telecommunications sector that HP shares with us.
Growth Drivers
Network Expansion
After implementation of Phase II Policy of FM radio privatization,
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private sector FM radio is likely to be available in many more cities
and will enable advertisers to reach out to a larger consumer
base, using radio as a medium. This could result in radio getting a
larger share of the advertising spends.
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Local Advertising
Globally, the local retail segment constitutes a large part of radio's
advertising income. As per the CII-KPMG report, while local
advertising contributes 70% of radio revenues in the United States
of America, in India, the share of local advertising is only about
8% of radio revenues. Ideally, a localized medium like radio can
be effectively used for local-level promotions and region-specific
advertising campaigns, apart from being bundled as part of cross-
media promotion strategies. This would make the medium more
attractive for a large number of local advertisers, rather than
being dependent on a concentrated set of national advertisers.
Other Opportunities
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Satellite Radio / Digital Audio Broadcast ("DAB")
Satellite radio is a radio service that provides radio signals directly
from satellites. DAB provides digital radio through a terrestrial
broadcast format. Satellite radio subscribers are also able to
receive upto 100 radio channels featuring high quality music,
news, weather, sports, talk radio. Currently, World Space India
Private Limited is the only player of Satellite radio in India,
providing about 40 radio channels. As Satellite radio becomes
routinely available in automobiles, subscribes can grow. Satellite
radio is now tapping into equipment players also. DVD players and
sound equipment manufacturers may install Satellite radio
technology. Satellite radio is primarily subscription driven and the
costs of access equipment are large at present.
Internet Radio
As internet connections have become faster and software for
cyberspace has become more sophisticated, audio listeners have
benefited. Free, downloadable audio players for computers have
made listening to audio via the computer possible. Traditional
over-the-air radio stations have begun to take advantage of the
new software, as well as the internet's ability to deliver graphics,
data and video at the same time, to enhance their audiences'
listening experience. The internet has also extended the reach of
radio stations beyond their own markets, which was determined
by the strength of their broadcast signals, to the entire world.
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ENVIRONMENTAL ANALYSIS
I. EXTERNAL ENVIRONMENT
PEST ANALYSIS
POLITICAL
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To enter in the industry, high one time entry fee has to be
given
There is no FDI allowed in this sector
Up to 15 % annual hike In licensee fee
Only 10 year of license is valid.
ECONOMIC
RJ’s mainly attracted by package that has been offered to
them by competitors.
SOCIAL
Showing responsibility towards various NGO
Help in June 2005 Mumbai flood.
TECHNOLOGICAL
Before 2000, there were only two music stations, but after
that radio industry came up with private Channels with
different frequencies. Today we have 10 music stations.
Internet radio is introduced.
Modern equipment and highly technical transmitters are
used
Visually appealing materials are also associated
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II. COMPETITIVE ENVIRONMENT
SWOT ANALYSIS
STRENGTHS
Radio Mirchi known for giving superior quality music and
benefits to their customers.
It delivers the best combination of innovative content and
interesting initiatives.
Serve each and every section of public starting from the
children to 70+ aged.
According to the latest listenership figures released by IMRB
International's Media & Panel Unit, confirms Radio Mirchi as
the leading FM Radio station ahead of Red FM and Radio City.
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With 12.1 laky daily listeners, Radio Mirchi leads with a 72
per cent share of the market.
MRB conducts the in-car listening research every fortnight in
Delhi, and findings indicate that Radio Mirchi is the favored
station on the roads with a share over 50 per cent on an
average since launch.
The research reveals that Radio Mirchi enjoys the highest
"loyalty" among its listeners.
Radio Mirchi has partnered with VIBGYOR 2008 (college fest
of International School of Business and Media).
Also with BLITZKRIEG 2008 (ICFAI Business School), COBWEB
2008 (college fest of LHMC) and SPANDAN 2008 (college fest
of Vivekananda College).
Their wide and national footprint enables our advertisers to
reach the largest number of listeners among private
operators in high income cities and adjoining areas.
Also won awards for its successful brand building.
the '983 - Kismat Khol De' Contest won the Gold medal for
Best Activity generating Brand Loyalty at the Promotion
Marketing Awards of Asia – 2004.
Bronze medal for Best Activity generating Brand Awareness
and Trial recruitment at the Promotion Marketing Awards of
Asia – 2004.
WEAKNESS
Listeners’ faces major distraction from advertisements aired
in between the show.
Long waiting queues to connect with them by calling.
Radio jockeys had no long lasting career.
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STRENGTHS
OPPORTUNITY
Future plans include exploring opportunities to become FM
radio broadcasters or content providers in international
markets at an appropriate time, either directly or through
strategic partnerships or inorganic initiatives.
Great opportunity in the field of generating their own news
show on air.
Field of internet radio
THREATS
Best combinati
Still facing threat from AIR FM and FM Gold. Both are take
care by government bodies.
Widely recogni 15
MARKETING STRATEGY
TARGET CUSTOMER PROFILE
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MARKETING MIX
PRICE & PLACE are the two factors which has no impact on the
customer’s( .i.e. radio listeners) of Radio Mirchi since they don’t
pay for listening radio and it is available everywhere(rather in
pockets of every person in the form of mobile)
PROMOTION
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• Jingles and promos
• Sponsored events in schools and colleges
• Mirchi job fest
• Mirchi activation team
• Radio workz
PRODUCT
• Broadcasting
(Ahmedabad,Mumbai,Banglore,Chennai,Indore,Kolkata,Luckn
ow etc.)
• Various programs at various time
• Family (7:00-11:00 am)
• Housewife(11:00-2:00 pm)
• Youth(2:00-5:00 pm)
• Evening Drive(5:00-9:00 pm)
• Late evening(9:00-11:00 pm)
• Night(11:00-1:00 am)
• Late night(1:00-7:00 am)
PHYSICAL ENVIORNMENT
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• High quality studio and transmission equipment
• DTH Radio involved radio broadcast from radio station via
satellites
• Good radio frequencies
PROCESS
PEOPLE
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