Sirius XM and Marketing 101
Well the day finally arrived when Sirius XM’s (NASDAQ:SIRI) Howard Stern debuted as a judge on the hit television show America’s Got Talent. What an opportunity for Sirius XM. Actually it is an opportunity LOST! Instead of Sirius XM putting together an advertising spot and letting a whole new audience know that Howard Stern is on the Sirius XM channels we saw the exact opposite. Sirius XM did not advertise at all on the 2 hour premier of America’s Got Talent. Instead, the folks at NBC Universal, the network that airs AGT, have had the forethought to buy advertising time on the Howard Stern channels to promote the show. Great news for the advertising executives at Sirius XM, but the reality is that AGT is a perfect backdrop for the satellite radio provider to expose their service to fans of America’s Got Talent and thus far the company seems to have dropped the ball on this.
In fairness, AGT did have lower rating this year when compared to last, but there were still an estimated 10 million viewers and this year the talent competition was up against the hit show Dancing With The Stars. An audience of 10 million is not something to ignore, especially when the central figure on that show is the biggest personality on the satellite radio airwaves.
While Sirius XM does garner the bulk of their subscribers from the auto channel, we must consider that there are 10’s of millions of cars on the roadways with satellite radios that are not active. Why not let those consumers know that they can get Howard as well as just about anything else with a subscription to satellite radio? Yes, an ad campaign would cost money, but Sirius XM is booking profits now and a concentrated campaign on a show like America’s Got Talent may be a catalyst that could help the company boost their metrics even further.
Sirius XM has been quite adept at keeping their subscribers once they get them with money spent in retention programs. Kudos for this performance. However, it is time to take things up a notch and to let the masses know you exist. Spotify is cutting deals with Coke to expand their brand. Facebook with their impressive Facebook Music service is propelling competitors to new heights while Sirius XM seems to squander such exposure.
It is not too late. America’s Got talent has a long season ahead of it. Howard Stern has been brilliant in exposing AGT to Sirius XM fans, it is time for Sirius XM to be brilliant and expose satellite radio to America’s Got Talent fans. Sometimes investing getting exposure to a new audience is a good thing. Sirius XM has done great in the auto channel. Now they have a real reason to get into advertising on television. Let’s hope that we see the Sirius XM brand on America’s Got Talent sooner rather than later.
Your expectations may be premature. It’s quite possible Siri management wants a feeling out period, before committing advertising dollars. Stern is a controversial figure, amongst many. Past mainstream television exploits have not fared well for him. Although it’s very possible his time has arrived (due to his watered-down act), the possibility still exists he will not be received well, by the overall American public. Prudent management would error on tne side of caution. If HS turns out to be a success, there’s plenty of time for Siri to commit.
U know I watched him on the view and he was actually very business like and professional in the little mention he made of his contract at Sirius. Not negative at all. Maybe he reached maturity. Besides, if Malone traes over he won’t put up with a bunch of baloney. These are just my thoughts from watching him on the View.
Due to the current legal squabbles between SiriusXM and Stern, my guess is that advertising on AGT and gaining subscribers would directly contradict their stance in the lawsuit. They could have advertised on AGT during the course of the previous 6 seasons but there’s no direct connection between AGT and SiriusXM. For them (SXM) to advertise this season and gain new subscribers would show an obvious link between new subscribers and Stern being on AGT. At which point SXM would have to pay Howard his money.
SiriusXM may change their mind to advertise but it’s doubtful.
Clearly with Karmazin heading out the door at SIRIXM and prolly heading to nbc why would Karmazin want to promote SIRI??
This script is all to familiar Karmazin will follw STERN where ever he goes, And thats NBC then he will go to any lengths to try and destroy Liberty and John Malone and SIRI, just like he has been trying to destroy Summner Redstone, Less Moonves, AND viacom.
Mel Karmazin has been a complete and total disaster for SIRI only to be outdone by his vengence
I disagree with that, what has he done to destroy Viacom since getting bumped down to SIRI? I do agree that Mel has probably already checked out mentally from SIRI after cashing in his chips and literally checking out of his stock holdings. But why would he turn against SIRI after he leaves the company? Frankly, he won’t have to wait very long until the satellites come tumbling down, I’m afraid. Although the times have passed Mel by, and he’s part of an aging radio establishment that is no longer relevant, I believe he knew how to spin the numbers and work Wall St. to keep the company in orbit. I hope he doesn’t intentionally hasten the downfall!
It doesn’t really matter what Mel thinks or does at this point. There should be no question that leadership will change hands soon. I can only hope that this will breathe new life into a very worthy company. Maybe they will actually advertise their product, or form relationships with other media outlets. Sirius will have a better debt picture, and the share price will climb….driven by the determination of the new largest share holder…John Malone. For now, I am following the innitiative by many investors and placing a sell order for all my holdings $10.00 per share. Lets see if that really slows down short activity.
SatRadio was such a great concept but the mismanagement of this company still never ceases to amaze me. Promoting Sirius XM on America’s Got Talent is a no-brainer. I’d love to come back if they ever get their act together but it doesn’t look like that will be happening anytime soon. Until then it’s Slacker, Pandora, RadioIO, and podcasts for me.
SIRIUS spend money on tv advertising? Ha! I have been waiting the last 4 years since the merger for them to air a Super Bowl commercial to no avail. Never happened. Mel has been promising a share buyback now that they are sitting on a ton of cash….and THAT has not happened yet since doing so would increase Liberties stake! So if you expected SIRIUS to buy air time on AGT you were setting yourself up for dissapointment! Lol. Seriously. Mel keeps talking about how much cash they have….and then doesnt do ANYTHING with it! Meanwhile Liberty is nibbling away and buying us up on the cheap.
And i thought LAST year was frustrating! Ha! This company is doing so well…and yet we shareholders don’t seem to be enjoying the bounty of our fruits. No tv ads. No share buybacks. It just seems like we are sitting on our hands waiting for Liberty to take control.
I really hope Mel announces SOMETHING concrete at the shareholder’s meeting next week instead of saying how GREAT we are doing! As nice as it is to hear, it’s beginning to get ANNOYING! YES! We all KNOW how GREAT we are doing! Quarter after Quarter you’ve been telling us. We get it. Now SHOW us something! You go on Cramer’s show a few months ago, and said the same thing! How we are a cash cow. You said that Liberty was free to do what they wanted, but that you would make sure we were being treated fairly! Um…hate to break it to ya Mel ol’ buddy ol’ chum….but Liberty is making their move…and so far we haven’t heard a PEEP from you. I hope you have something to say besides how great we are doing, cause if you don’t, i think I am literally going to scream. Lol.
Either you announce you are gonna fight them legally for sneaking around the way they have or tell us you are NEGOTIATING with them for some kind of mutually beneficial deal. Enough is enough. No more standing around telling us how great the company is! We know that! Duh. Liberty KNOWS that! Thats why they are doing what they are doing!
Now its time for YOU to do something Mel. Fight or come to the table! Anything else, i don’t want to hear!
You think Mel is listening? Lol. Guess we will find out in a week. 🙂
Spencer,
Any comment about the last 2 trading days. Looking for your take on things.
Mel K. has done a great job fixing this company post merger and saving it through the worst financial downturn in US history. Company almost went bankrupt because of FCC dilly dallying, bad timing and bad luck. The company now has over 22 million subscribers; a churn of 1.9% as low as it gets in the subscription media business; they are now consistently profitable and their free cash flow is extraordinary and growing. They will have over a billion in the back end of this year. Debts are entirely under control and their cost of financing has gone down 50% in past two yrs. They could take the company to investment grade at any time. SIRI now represents about 60% of the asset value of LMCA and Malone and company are salivating for control of NOLs and huge free cash potential. Regarding advertising, they have never wasted money on advertising because the key channels of growth have been car dealers. They have made incredible headway in the used car market… they have a record number of subscribers and growing!!! who needs advertising?!! advertising is for the desperate
Advertising on AGT would have been a waste of money. Anyone that cares about Howard Stern knows he is on Sirius. Anyone that buys a new car with Sirius, knows that Howard Stern is on it.
To justify spending advertising dollars on AGT, you have to convince yourself that people that discover Howard Stern for the first time, 1) aren’t taking a pee break when the commercial is on 2) don’t realize he is on Sirius and 3) will want to go out an buy a retail receiver, just to get him. Pretty tough sell to any rational advertising exec. Fortunately Mel is rational.
So Spencer. Are you going to chime in on the whole Brandon saying SIRI is going to be forced into bankrupcy once Liberty takes control BS? What are your thoughts on Brandon going off the deep end like this? He is not saying it could happen, he is saying it WILL happen, and he is telling every current shareholder of SIRI to sell now because they will all be wiped out. Don’t you think he has finally lost it?
Hey Spencer, good morning i know you went to shareholder meetings in the past are you going this year.This meeting to me at least is probably the most critical in all the years we all have been in this.Maybe if you can make it ,put out a twitter handle and lets us know through twitter what issues are being brought up and the answers about clarifying all these unknowns.How about it,you have my email let me know if its a possibility.
Here is the funny thing. The opening of the first New York AGT program showed people tuning in NORMAL radios on the street, to listen to Howard announce his appearance in NY. Every one of those radios should have had SiriusXM on them.
Really stupid.