However, before XM can achieve success in the market, it must be willing to adopt a marketing strategy that fits its product. XM can also capitalize on its unique advantages by leveraging partnerships with manufacturing brands and strategic partnerships with broadcast and retail channels.
Considering the competition that XM has faced, it should take a look at some of the key revenue generating aspects of its business model. By offering a more competitive price, XM could create a niche for itself and establish itself in the market. At the same time, XM could charge a higher rate to companies that are more profitable. Regardless of which approach XM takes, its marketing efforts will need to be geared towards appealing to the most tech savvy of consumers.
XM should consider creating a package deal that enables customers to enjoy the benefits of both a satellite radio and a satellite TV. This would allow XM to keep up with the latest technology and offer new services to consumers. For instance, a Satellite TV service could be offered as an add-on feature to high-end in-car head units or as a separate subscription. Similarly, XM could create a portable satellite radio receiver similar to the mini Mp3 player.
Using a satellite TV service to broadcast a local newscast or talk show could generate revenue by allowing a limited number of commercials to be displayed. A similar approach is used by streaming services. Many businesses use this technique as an alternative to paying for music downloads.
Another strategy is to create an encrypted channel package that allows users to choose which stations they wish to view. Having such a product could also give XM the opportunity to expand its brand name awareness.
XM should look into the cost of advertising and evaluate how much revenue it can expect from it. In addition, it should also evaluate the cost of its service and how it would impact its estimated and desired earnings. If the costs of such a service are high, XM could end up losing out on its competitive advantage. But if a higher subscription fee is chosen, XM could earn more than $572 million in additional revenues.
As an alternative to traditional terrestrial radio, XM offers the ability to deliver quality, clear performance and a variety of radio content. Additionally, XM has near ubiquitous coverage in the contiguous U.S. and Mexico. Unlike terrestrial radio, XM listeners can receive a crystal clear signal at any location, irrespective of the quality of the surrounding environment.
While XM has a lot of work ahead of it to establish itself in the competitive marketplace, the XM service has been created to offer consumers a way to enjoy music wherever they are. The company has been able to do this by delivering a wide variety of digital radio content to consumers, offering an experience that rivals traditional FM and AM stations.