Wednesday, 21 March 2012

Mirchi Goes International, A Reflection!

On 1st February 2012, when Rani Mukherjee pressed the red launch button in Abu Dhabi, little did she know that it marked Radio Mirchi’s first international foray! ENIL’s (Entertainment Network India Limited) FM radio brand, Radio Mirchi has been launched in United Arab Emirates (UAE) in association with Abu Dhabi Media Limited (ADML), which operates Arabic and English language radio channels. With the addition of Radio Mirchi to its bouquet, ADML’s target segment now also includes 24-35 year-old affluent, youthful Asians from the South Asian subcontinent. Radio Mirchi will be available across UAE on 97.3FM in Abu Dhabi, 88.8FM in Dubai and the Northern Emirates and 95.6FM in Al Ain. The language of the station will be Hindi and English.
Mirchi’s UAE debut could not have happened at a more opportune time. Advertising spends on radio are growing, as per the data available from Pan Arab Research Center, in UAE, the share of radio was  4 per cent of the total advertising market in the first half of 2011 (Jan – Jun), up from 2 per cent in 2010 (Jan – Jun 2010). However the rates that Mirchi will be able to command will be co-related to advertising spends on other South Asian media (TV/radio/print/internet) available to advertisers in UAE. But being a part of a larger media group (ADML) Mirchi should be able to overcome the competition from other South Asian radio stations.
Data on the financial contours of the association is not available in the public domain, however as told by Mr Prashant Panday to one trade portal it’s a brand licensing agreement with ADML. Mirchi will provide guidance on revenue generation, programming and non-music content. My guess is Mirchi’s investment in this venture is towards personnel, programming and infrastructure usage of ADML. Advertising dollars would be shared between ADML and ENIL, what ratio…? Only Mr Prashant Panday can tell. Especially about “guidance on revenue generation”, in my opinion it is Mirchi’s ability to bring business best practices as its end of the deal. India is a bigger market than UAE in terms of advertising spends, has an established audience measurement system and even though one rants about all the FM stations sounding the same, I strongly feel, there is still an honest effort to innovate on part of Indian FM stations. What are these innovations, you’ll have to listen to find out! If a station has cut its teeth in India, UAE is no rocket science!
Though it’s not the first time an Indian radio station has forayed into overseas markets. Sometime back BigFM joined hands with Asian FM, USA and Mediacorp, Singapore to syndicate its content. However in the present case, the entire programming line-up is driven by Mirchi on dedicated 24 hours channels, divided into 5 part day of 0600 Hrs – 1100 Hrs (breakfast), 1100 Hrs – 1400 Hrs (mid-day), 1400 Hrs – 1700 Hrs (Filmy), 1700 PM – 2100 Hrs (drivetime), 2100 Hrs – Midnight (retro) and Midnight – 0600 Hrs (back2back music). I also assume that Mirchi will have access to exclusive content due to its Bollywood connect and now the ability to promote movies produced back home in UAE. A win-win for ADML, ENIL and Bollywood Movie Producers!
With a population of approximately 9 million, UAE’s demographics are led by around 2 mn Indians, 1.75 mn Pakistanis, 0.6 mn Filipinos and 0.5 mn Bangladeshis. Among the 2 mn Indians, people from the Indian state of Kerala alone are over a million and are amply entertained by 08 Malayalam Language radio channels (more Malayalam language stations from Indian media houses are in the pipeline!). Mirchi will compete not only with hinglish radio stations like Citi 101.6 FM, Radio4FM, Suno 102.4 FM (Internet Radio Station, no terrestrial presence), HUM 106.2 FM, and RadioSpice 105.4FM but will also compete with Indian Pay TV channels that are seeing an increase in the number of their viewers. However it will be safe to discount the competition from Indian Pay TV channels since UAE has a big car culture and the majority of radio listening happens during commute or long drive times between Emirates. Flipping the argument, in fact Mirchi may give some competition to South Asian Pay channels by splitting the regional advertising pie.
Looking at the packed audiences of Bollywood based Award Shows (e.g. IIFA) that are hosted in Emirates and Bollywood movie releases in UAE (as per industry estimates, a third of overseas Bollywood revenues are from UAE), it suffices that there is a huge appetite for Bollywood in Emirates and with the arrival of Mirchi, Radio as a medium will grow.
What will also be interesting to note is the introduction of other Mirchi properties in UAE such as mobile applications, internet radio and events (e.g. Mirchi Music Awards, Mirchi Kaan Awards), and how they are customized for Emirates. I’ll also wait to see, whether other Indian Radio stations beat a path to UAE if Mirchi’s investment pays off and whether Mirchi sticks to only Indian contemporary hit radio (CHR) format in other overseas markets on its radar (China, Eastern Europe etc.) or will it be local programming spiced with Mirchi!
Last but not the least; I hope Mirchi succeeds in changing the perception of radio in UAE!
P:S. Saw this update in my Linkedin news feed on 15th March 2012 J

1 comment:

  1. Wow.. what a detailed analysis... looked through all the aspects of the business opportunity...

    ReplyDelete

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