Why Saregama’s Carvaan became a success in the age of Gaana & Saavn?
A first look at Saregama’s Carvaan and you would be filled with doubt as to why a veteran music company would launch a product that is easily half a decade behind in technology. Intuitively, this would have been an absolute reject in the age of video and music streaming services.
However, a big box with 5000 preloaded songs, sold like hot cakes in 2018’s India which was just witnessing a resurgence in mobile internet with Jio’s onslaught.
So what went right for Saregama’s Carvaan?
More often than not, on this “marketing blog” we have maintained that product is at the heart of great brands. For a product in the FMCD and FMCG category, after the product itself, distribution is the key to success. It is only after product and distribution that marketing comes in the picture to give the final nudge. But we maintain, a good product will sell itself. We have enough recent and old examples. Let’s discuss what made Saregama Carvaan sell.
- A product backed by strong consumer insight
The first step in identifying a great product is to decide if there is a need for the same in the market. While a lot of millennials have accepted the likes of Gaana, Saavn, Youtube for their music needs, people over 40 years of age are still struggling to adapt to the new technological changes in the way music that they have grown up listening to is now being accessed.
A market was ripe for users who loved music but had trouble downloading or streaming it through the music discovery apps currently available in the market. These users wanted a lean back experience which was a void that Saregama’s Carvaan filled. An easy way to listen to your favorite music.
- Precision targeting & segmentation
They often say that 80% of your business comes from 20% of the audience. But the beauty about Saregama’s Carvaan is that it did not make an attempt to be a product for all.
Carvaan is strictly targeted at the 40 plus audience. It is for people who love music but find it too cumbersome to download their favorite songs. The plan was simple, to load the device with songs that the 40s and the 50 plusses yearn for.
Saregama, being the big daddy of music industry before the digital age and piracy happened to the India music industry got consumption data from 134 partners including Youtube, Saavn, Gaana and the lines. It analyzed over 1.1 billion consumption points to come up with a catalogue of 5000 evergreen songs
That was about targeting, however, the audience for Carvaan is not just the user. It had two segments, the buyer and the consumer. As we approach 2020, India is on its way to become the youngest country in the world. To not make a product which of no relevance to one third of India’s population and almost 46% of its workforce would be a strategy nightmare to start with. A report from Morgan Stanley Research suggests that 70% of total household incomes is contributed by millennials — those born after 1982.
Which brings us to the last pillar of Saregama Carvaan’s success story. Positioning.
Also read : 8th P of Marketing
Carvaan, a unique gift to say you care!
Saregama Carvaan is being positioned as a gifting item. As mentioned above, the buyer and the user are two different segments for Saregama Carvaan. Priced at a little over Rs. 5900, to have conservative price sensitive,middle class parents in India indulge in this device would have been a tough ask.
According to Mehra, MD of Saregama Carvaan, as people retire the tendency to spend purely on themselves goes down, which is why, according to him, his product team added a Bluetooth feature in the mix to increase the utility once it is brought home.
Made for old, sold to young
Made for offline, sold online
To position it as a gifting item was the last nail in the coffin by Saregama. The product was made for someone else, but it had to talk to someone who will buy it. Saregama couldn’t ignore the increasing purchasing power and disposable income of the millennials.
People in the age group of 20 to 35 are often at wit’s end and out of options of gifts to give to their parents or grandparents. The urge to gift or do something special and personal for your parents is even more as families become nuclear and millennials start living away from their parents.
This is the reason why Amazon become an important distribution channel for Saregama Carvaan and soon became one of the top sold products on Amazon.
The management believes that at some point in the future the buyer and the user will merge and hence they have opted for a online and offline channel to sell Carvaan.
What’s next for Saregama Carvaan?
In the first 3 quarters of 2017–18, Saregama had sold around 241,000 units. They have set a target of selling 1 million units in FY 2018–19 having already sold around 0.6 million till date.
The next growth of Saregama Carvaan will come from tier 2 and smaller cities. As is the priority for all new age businesses in India, vernacular and personalization hold the key for Carvaan as well which is where it’s regional variants will further add to its relevance in the diversified choices and music taste of Indian markets.
The Saregama Stock listed in the exchange has got a new lease of life in the latter half of 2017 coinciding with the launch of Carvaan.
From the looks of it, the product needs to keep improving and moving ahead with times still stay true to it’s USP of being simple and easy to use. The success story has just started and the potential is huge.
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