Presented byAnuja Jain

Arihant DardaArun ChaharAshwini JainCharu PahwaMohit Rathi

Presented to :Prof Shubhra Behl

ADDING MIRCHI TO INDIA

Radio Mirchi is the most popular private FM radio channel in INDIA with the largest operating network and a presence in 33 cities and 6 metros. The case traces the emergence of Radio Mirchi as a leader in the FM radio industry.The case talks about the company’s innovative marketing and promotional campaigns. It also describes the government policies , vis-a-vis FM radio, and their impact on Radio Mirchi and other FM broadcasters. The case finally talks about the challenges that Radio Mirchi might have to face in the changed environment and the future outlook for the company.

Background Note

Operated by entertainment network INDIA ltd.(ENIL)Promoters:- BENNET, COLEMAN &

Company and time information media ltd.Radio Mirchi is STAR SBU of ENIL

started October 2001.

FIRST WAVE OF PRIVATIZATION July 1999 Govt. decided to privatize FM radio sector.

Govt. offered licenses for 10 years, charging 15% license fee with annual hike

In 2000 Govt. started bidding process for 108 FM radio license in 41 cities

Radio Mirchi bid on 64 Frequencies and won 12 licenses

Radio Mirchi started first from INDORE

Competition for ads revenue among other FM(Mumbai and DELHI)

Changed the perception of Radio

Create a colorful image in audience

CONTD…Segmentation of listeners and program was customized

Local language programes

Updated everyday new releases

Reminder to reinforce marketing

Invested in high Quality

Launching innovation promotion campaigns

CSR (NGO’s)

Good content and marketing

SECOND WAVE OF PRIVATISATION

Occurred losses because high license fee in phase 1

Threatened to close operation

Govt. agree on 4% of revenue as license fee

Bidding was done in 337 frequencies in 91 cities, Radio Mirchi won 32 freq.

Fear of niche broadcaster

Expansion of Radio Mirchi to abroad

High charge taken by PPL(Phonographic performance ltd.)

Started strategic alliance with international players

MAJOR EVENTSYear Event

October 2001 Launched radio broadcasting station in Indore.

December 2001 Launched radio broadcasting station in Ahmedabad.

April 2002 Radio broadcasting station in Mumbai.

May 2002 Launched radio broadcasting station in Pune. December 2002 Investment by DHHL in our Company. April 2003 Launched radio broadcasting station in Delhi. May 2003 Launched radio broadcasting station in Kolkata.

May 2003 Launched radio broadcasting station in Chennai.

October 2005 Reduction of capital and set off of losses against the share capital and the securities premium account.

October 2005 Incorporation of subsidiary Times Innovative Media Private Limited.

October 2005 Transfer of the 360 Degrees and OOH media businesses from TIML to TIMPL.

October 2005 Purchase of DHHL's shareholding in the Company by BCCL.

February 2006 Initial public offering of 13.2 million equity shares of Rupees 10 each at the premium of Rupees 152

April 2006 Launched radio broadcasting stations in Banglore, Jaipur and Hyderabad

April 2007 Launched radio broadcasting stations in Patna & Jalandhar

PEST ANALYSIS POLITICAL/LEGAL

Privatization of FM radio High licensing fee To enter into industry, high one time entry fee has to be given There is no FDI allowed in this sector Up to 15% hike in annual fees Only 10 year license is valid Migration fees to switch to second phaseTussle with phonographic performance ltd. for copyright and licensing fee

ECONOMIC

RJ’s mainly attracted by package that has been preferred to them by competitors. Royalty pay to music companies High installation and operating cost

Contd… SOCIAL FACTORS

Make programs according to regions (Multilanguage) NGO’s “GIFT A SMILE,MAKE A DIFFERENCE” Westernization is coming so needs and preferences of Indian customer is changed 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 Advancement in technology (Internet world) Modern equipment and highly technical transmitters are used

SWOT ANALYSIS STRENGTHS WEAKNESSES

Best combination of innovative content and interesting initiatives

Serves all age groupsWidely recognizedStrong advertisement sales capabilityHigh quality studio and transmission

equipment

MEAGER penetration in Indian marketsLong waiting quese to get connected

OPPORTUNITIES THREATS

Satellite Radio/DABInternet radioThrough regulatory changesInternational market

AIR FM radioNew entrants –star India and ADLABSRetaining talented RJ’sIncreasing demand of internetIncreasing demand of world space

radio

ANSOFF MATRIX

PRIMARY OBJECTIVE:• They should work upon the strategy to capture those markets where there is no

radio services available to gain COMPETITIVE ADVANTAGE.

SECONDARY OBJECTIVES: In order to attract large number of customers it can start programs like “KHABRI BABA” in which the listners will give any five” news “and they will get special gifts.

EXISTING PRODUCT NEW PRODUCT

EXISTING MARKET Market penetration Product development

NEW MARKET Market development Diversification

On the basis of Ansoff’s matrix,RADIO MIRCHI can go for two objectives:

MARKETING MIX PRODUCT

High quality studio and transmission equipment Mass audience Multilinguistic programs Customization Emphasis on culture

PLACE AND TIMEBroadcasting (Ahmedabad,Mumbai,Banglore,Chennai,Indore,Kolkata,Lucknow 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)

CONTD… PROMOTION

Cross media marketingBite a mirchi a get a pepsi freeMirchi packetsOnline promotion (983 kismat khol de) DabbawallasMumbai marathonMirchi khoobsurat9 baj gaye kyaMirchi kaan awardsInnovative programs (pappi da, go go ganguli,Mr. hot crack pot,Ding-Dong) Jingles and promos Sponsored events in schools and colleges Mirchi job festMirchi activation team Radio workz

PRICE

PHYSICAL ENVIORNMENT High quality studio and transmission equipment DTH Radio involved radio broadcast from radio station via satellites Good radio frequencies

PROCESS Direct attachment with audience Talented RJ’s Direct to home radio Visual radio Internet radio Digital audio broadcastingSatellite radio seprate sales team of 130 employees in 8 cities

PEOPLE Hired skilled RJ’s Emphasised on audience choiceLevel of customer involvements

WHO OR WHAT?

WHAT IS THE NATURE OF RADIO MIRCHI?

WHO OR WHAT IS THE DIRECT RECEIPIENT?

DIRECTED AT PEOPLE

DIRECTED AT POSSESSIONS

TANGIBLE ACTS

PEOPLE PROCESSING

Possession Processing

INTANGIBLEACTS

MENTAL STIMULUS PROCESSING

Information Processing

Segmentation Demographic:-

Age group 18-35 Gender Family, Housewife, Youth

Geographic:- Presence in more than 33 cities 6 metros (Mumbai, Delhi, Lucknow, Banglore, Chennai, Indore)Abroad

Behavioral:- Time Evening drive time, Late evening, Night, Late night

Situational:- Radio Mirchi came up with unique game or any kind of attractive show(for e.g. new year,Diwali,R.D. Burman show,Valentine day) Give reminder like “9 baj gaye kya ”

Psychographic:-It keeps track records of latest and customer demand (Bhojpuri, Punjabi, English)

Targeting• Radio Mirchi has targeted listeners as well as

advertisers. It has mainly targeted youth(18-35) because they are the major chunk of population.

S1

S2

S3

M1 M2 M3

Radio Mirchi is targeting on service specialization.

POSITIONING

“MIRCHI SUNNE WALE ALWAYS KHUSH…”

• PICTURE OF SENDER

PHYS

IQUE

PERSONALITY

REFLECTION

SELF

-IMAGE

RELATION

CULTURE

INNOVATIVE PROGRAMES AND COVERS ALL SECTIONS

DIRECT RELATION

MIRCHI AS LOGO—IT’S HOTYOUTH

MIRCHI SUNNE WALE ALWAYS KHUSHCOVERED ALL AREAS

BRAND IDENTITY PRISM

CORPORATE SOCIAL RESPONSIBILITY

“GIFT A SMILE,MAKE A DIFFERENCE” with an NGO.

Giving listeners a platform to raise their voice in election time

Briefing about election process

Motivating them to go out and vote

Showing responsibility during June 2005 flood time in Mumbai

MARKETING STRATEGY OF RADIO MIRCHI FORTRESS STRATEGY:-

EMPHASISED ON CUSTOMIZATION THROUGH INNOVATIVE AND ATTRACTIVE PROGRAMES RADIO MIRCHI, IN ORDER TO BE IN LIMELIGHT, CONCENTRATED ON EVERYTHING LIKE CORPORATE ENTITIES, PROMOTIONAL ACTIVITIES,CELEBRITIES,SPORTPERSONS,LOCAL MASSESS LIKE DABBAWALLAS ETC… IT MADE ONLINE AND OFFLINE MARKETING

MARKET EXPANSION:-CROSS MEDIA MARKETING IT EMPHASISED ON EVERY SEGMENT LIKE YOUNGSTERS.FAMILY,OLDAGE PEOPLE,PRIME EARNING AND SPENDING GROUPON EVERY MEDIA IT HAS BROADCASTED ITSELF IN NEWSCHANNELS,TELVISION,INTERNET ETCIN EVERY CITIES FROM METROS TO RURAL AREAS

NEW CHALLENGES Diverse program content was required Emergence of niche broadcasters GOI allowance of 20% FDI Many joint ventures were formed BBC worldwide and MID-DAY multimedia ltd UK’s Virgin Radio with Hindustan times

RE-ENTRY OF THE PLAYERS: Star INDIA WIN 94.6

NEW ENTERIES Adlabs South Asia FM-Earlier in Southern India.

THANK

YOU