This is only part of the reason that XM is becoming the leader in the satellite radio industry.
XM is challenging the traditional radio communications companies for a part of the existing market. They do not plan on taking over the industry, but they are trying to fill a niche in the world by supplementing the existing radio with a different form of service. With over a hundred channels that have a minimum of advertising available the country over. Talk shows, Music, Car Races, and live performances. They don't do local. Local Radio stations don't see it this way. Most local stations will not air XM advertisements, because they feel that XM is intruding in their markets. .
The purpose of our presentation is to discuss XM's Growth Strategy to show how a corporation creates a new market with a new product, a feat which is not easy to accomplish. Their Growth Strategy follows: 1)Building an Audience, 2) Extending their Presence Among Car Companies and Retailers, 3) Innovation and Expanding their Line of Radios, and 5) Building Financial Stability. We will also be discussing problems they have been facing within the specific areas of their Growth Strategy and what they've done to try and overcome these problems. (XMSR.com).
Building an audience.
Part of XM's Growth Strategy is to build up their audience through various marketing approaches. XM's breakeven point is 2.4 to 3 million customers. They just reached 929,000 subscribers on October 1st, adding more than 135,000 subscribers in the 3rd quarter. Many more subscribers are needed if the market is to grow and XM can start turning a profit. Many radio stations have also been reluctant to air XM ads, cutting down on the number of potential customers XM can reach.
Part of XM's strategy to gain more subscribers is to form marketing partnerships with big names like Clear Channel Entertainment, which is the world's leading promoter and marketer of live entertainment.
