Introduction Radio Mirchi is the most popular private FM radio channel in India with the largest operating network and a presence in 33 cities & 6 Metros. The case traces the emergence of Radio Mirchi as a leader in the Indian FM radio industry. The case talks about the companys 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 new 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: Bennett, Coleman & Co. and Time Infotainment Media Ltd. Radio Mirchi is Star SBU of ENIL , started October 2001
First wave of FM Privatization July 1999 gov decided to privatize FM Radio sector. Ninth Five year plan Gov offered licenses for 10 year, charging 15% license fee with annual hike. 2000 gov started bidding process for 108 FM radio licenses in 41 cities. Radio mirchi bidd on 64 F & won 12 licences. Radio Mirchi started first from Indore. Competion for Ads revenue amoung other FM ( Mumbai & Delhi)
ADDING SPICE Change Perception of Radio. Created a colorful image in audience. Segmentation of listeners & program was customized. Local language programs. Updated every week new releases. Listeners chatted with film stars. Radio mirchi hired RJs (radio jockey) Radio Mirchi invested in high quality equipment & transmissions.
Marketing Mirchi Advertisements Display media Tie up with companies Feedback from listeners (build consumer involvement) Sponsored many things. Launching innovative promotion campaigns. Made sales team to maintain relation with local advertisers Price of Ads based on time. Additional income from SMS
Growing popularity of RM Popular in youths. Reminder to reinforce marketing Help to other SBU. Program format of local language. CSR (NGOs) Information regarding traffic, health, safety e.t.c Good content & marketing
ll- wave of FM Privatization Occurred losses because high license fees in l phase Threatened to close operation. Gov agree on 4% ENIL decided to fund expansion through a public issue. Bidding was 337 F in 91 cities, RM win 32 Sun tv44 , Adlabs also came.
New Challenges Policy guidelines Fear of Niche broadcaster Entry of foreign radio channel Re-entering of 1phase player Adlabs ,Sun Tv New campaign of existing One-station-per-company-per city norm implemented by gov High charge taken by ppl (phonographic performance ltd) Development of high technology- internet, quality of software, internet radio, digital audio broadcasting Gov restricted 2-3 minutes news only
Outlook Optimistic about new policy Listeners increased Market reach Started strategic partnership with international players. Provide consultancy services in Bangladesh to set up new radio station Maintain Leading position through innovative marketing campaign.
Questions What in your opinion has contributed to immense success of Radio Mirchi? Do you think gov was only responsible for losses incurred by private FM or companies themselves to blame for lack of judging the FM industry potential? Is the current optimism justified considering the fact that revenue growth in FM industry is very slow and the competition has intensified What are the future prospects for Radio Mirchi? Do you think it can continue dominating the indian FM radio industry