Yes, we do keep hearing Radio FM during some part of our day, may be it is during morning hours or during drive to office or back home. Though we enjoy the songs and RJ’s presentation, the business model which works behind the scenes is kind of complex.
It is untold truth that every business needs to be profitable to exist and it is fundamental element. And where does Radio Mirchi makes it money?
Daily Ads: The first revenue model comes to our mind are the advertisements being broadcasted during entire day. It does get revenue, but is that revenue a business can relay on? Mind you, the number of ads being broadcasted per day more or less can’t be increased, so this revenue is fixed. It can’t really make your top line grow.
In order to be competitive and to make top line grow, each FM needs to engage itself in backend revenue generator models. Look at the events being promoted by Radio Mirchi. They typically get involved with some firm and organize events through out a particular city or area, there by generating revenue from it. The associated firm gets a great marketing boost.
In addition to this, FM radios are being hooked up by marketing firms to survey a particular segment of people. With out our notice we kind of share our information about what we like and what are our shopping habits. This kind of marketing data has a huge value. Off course we do share our cell phone the moment we call.
In addition to this, companies select FM radios for promoting their products or service. Like ‘tikat Thursday’ or ‘Blockbuster Budhawar’, where companies give free vouchers and try promoting the services, needless to say, Radio Mirchi makes money in addition to Vouchers it sends to winners.
In US, the Satelight radio got a huge success, because of the unique business model they have in place. Perhaps it is slightly complex by the way in which it operates and generates money, but it is for sure a money spinner for investors.
We are kind of used to AIR broadcasting where, every thing was decided by the broadcasting ministry. And AIR, typically, don’t bother about the fact that it has to generate money. But, new FM radios needs to have a growing business and this market segment will only get interesting going forward.
‘Mirchi sunnewale always khush!’ :)
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4 comments:
How about the business model for the different Google services.
Is it just those tiny ads on the corners which keep it chugging ?
Saurabh, Google has a back end revenue generating model as well.
They charge the customers to get in to their database and each 'successful' transation a viewer makes through Google. This is the main money maker and they have speceal categories in it. All premium subscribers will get special visibility towards right side of the browser when you search some thing.
In addition to this, they are entering in to print media, where they are working through news papers.
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