The Motley Fool Discussion Boards

Previous Page

Stocks S / Sirius XM Radio


Subject:  Re: XM Rumor regaring financing & price increase Date:  9/4/2002  2:23 PM
Author:  MHolt100 Number:  1702 of 10889

I also noticed much more prominent floor-displays for Sirius satellite radios in the Circuit City and Best Buy stores that I have visited. However, another competitive issue that Sirius faces in retail stores is the fact that most of the salespeople are young, and the XM branding has more appeal to them. They, therefore, tend to be biased toward XM satellite radio, over the "other brand" with a cartoon caricature of a dog on it. For example, the XM Satellite radio logo is perceived as being cool (along with the names of their satellites -- "rock" and "roll"), while the Sirius Satellite radio logo falls somewhere in between the Walt Disney character "Goofy" and "Blue" on the toddler TV show "Blue's Clues." The teenage guys selling merchandise at the electronics stores are more likely to relate to the former than the latter.

Fundamentally, you would think that Sirius would have more appeal to younger listeners, since they are likely to have a high level of interest in music stations and Sirius doesn't interrupt its music stations with commercials. However, because of the branding, many salespeople seem to know Sirius simply as "the dog brand." I'm not so keen on the dog logo, myself, and I know the truth in the saying that the first impression is the most important impression because it may be the last impression.

I did encounter a very knowledgeable and helpful salesperson at a Circuit City store that I visited. He made another more substantive observation, which is that Sirius offers a larger variety of stations that are also commercial-free, but he perceived the quality of the XM Satellite radio stations to be superior. To him, the presentation of the Sirius satellite radio stations was rather bland, while the XM Satellite radio stations had more character to them. It left me thinking of how Motorola lost market share to Nokia because Motorola targeted its products toward business people, while Nokia targeted its products toward teens. Nokia's products were considered to be cool, while Motorola's products were considered to be boring. I just hope that Sirius doesn't make the same mistake -- but this won't be clear until Sirius launches its advertising campaign in full force. It may be that Sirius will just have to concede some major market share to XM Satellite radio at the retail store level, and hope to do better in sales of satellite radio to car buyers who choose car brands that only offer Sirius satellite radios as an option. But, even at this level, XM satellite radio seems to be standing ground with their recent announcement that XM satellite radios will be available on October 1 as an option on various Honda models, including the #1 best selling Honda Accord.
Copyright 1996-2022 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us