Besides building brand solutions, the company has also built a strong digital content arm
Radio Mirchi 98.3 FM radio which is operated by Entertainment Networks India Ltd (ENIL) and is part of Bennett Coleman and Company (BCCL) over the years claims to have developed additional revenue streams. “Brand solutions is a big focus area for the company and has already paid results. Last year, brand solutions contributed to 35% of overall revenue. In five years time, brand solutions will account for two-thirds of our overall revenue as it is one of the fastest-growing businesses,” Prashant Panday, MD and CEO, Entertainment Network India Ltd (ENIL) told BrandWagon Online.
With radio being a local medium to advertise, the company claims that its brand solutions division has created local solutions for brands such as Asian Paints in Bihar and Uber in Delhi, thereby driving both sales and salience. According to Panday, the company provides solutions to brands in 63 cities.
Additionally, it claims to have built a digital content arm which also creates original content for other streaming platforms. “Our digital content strategy is multi-thronged. Besides creating content for MX Player, we are in talks with other platforms. We have also begun to create content featuring celebrities who usually associate with us when it comes to promoting their films. These contents are usually aired on our YouTube channel,” Panday explained. Last year, Radio Mirchi garnered 700 million views across its 10 YouTube channels. Moreover, the company is creating podcasts for clients which are being telecast on music streaming app – Gaana. It should be noted as per its alliance with the music streaming app – on digital royalty is paid by Gaana.
Besides print, radio has been another most affected mediums as advertising declined steeply. According to the latest report by audit firm KPMG radio industry is expected to post a negative growth of 50% to Rs 1,200 crore in FY21 as opposed to Rs 2,500 crore in FY20. While the volume of advertising has declined by 25-30%, value has dropped by 155. According to industry estimated a ten-second ad spot costs in the range of Rs 1,600 – Rs 1,800. As per Panday, the company will see a drop in revenue this fiscal primarily because the loss of revenue suffered in the first half of the year which cannot be made up in the second half. Nonetheless, the company’s profitability, on the other hand, will see a rise in H2 FY2021. “According to our recent forecast, our revenue numbers for H2 are going to be down by 25% or so as opposed to last year. However, I expect the company’s H2 to be more profitable than that of last year because of all the massive cost cuts that we had undertaken. So, there are two sides to it– revenues will be down but profitability will be stronger in the second half of the fiscal,” he added.
Interestingly, despite the disruption to business caused by the pandemic, the company which expanded its operations to the US in 2019, expects to break-even this year in international waters. Moreover, it plans to launch its operations in Qatar by either Christmas or in the first week of January and enter Bahrain by the end of January.