Financial Daily from THE HINDU group of publications
Friday, Aug 19, 2005
MTV to focus on high-end consumer products
Mumbai , Aug. 18
MTV Networks India Pvt Ltd has decided to focus on high-value products in mobile telephony and consumer electronics to boost its licensing and merchandising business.
Speaking to Business Line, Mr Sanjev Hiremath, Senior Vice-President, MTV Networks, said, "We are planning to add one more category in the licensing and merchandising business. It would possibly be in the hardware or software side in the mobile telephone space. We are also considering licensing the brand to consumer durable brands in the category of MP3 players."
With its presence in far too many categories, the music channel has decided to consolidate its operations in the licensing and merchandising business. "We want to consolidate and, at the same time, get into a category which is not mass," he said.
Having exited the FMCG business in the past, MTV had launched perfumes and deodorants by licensing its brand to a firm in the UAE. Besides, it has also ceased to exist in the cassettes and CDs space under its own brand label. It has also discontinued its association with Airtel for its prepaid cards.
"We have now decided to become selective about the categories we enter. It has to meet the objectives of the MTV brand," said Mr Hiremath.
Meanwhile, the youth-oriented music channel has changed its strategy for its clothing and accessories. The change involves selling MTV Style brand in smaller cities, and staying away from the big metros, where there is a clutter of international labels.
Explaining the new strategy, Mr Hiremath said, "We have decided on a ground-up approach. We will first launch our products in the small cities with multi-branded outlets before reaching out to the big departmental stores which tend to have a space constraint." Today, MTV clothing and accessories are available in 30 cities in almost 100 stores.
After appointing a new licensee partner, Primus, in Bangalore, which has the infrastructure in terms of owning stores, MTV clothing is also being sold through the Primus Youth stores across the country. Registering a 40 per cent increase in the apparel business over the past year, the channel believes that changing its licensee partner has made a difference to its clothing business. As Mr Hiremath said, "MTV has always had in-house designing capabilities and we were looking for a partner with a strong backend distribution; today, Primus is an additional partner in our business."
Other areas in the licensing and merchandising business include credit cards through a co-branded association with Citibank. Recently, the channel also introduced a debit card and, today, it has a card-holder base of 1.5 lakh customers. Besides, during the recent re-launch of Titan's FasTrack brand of watches, the channel introduced another sub-brand of its `MTV Masala' collection.
The channel is also planning to beef up offerings for Nickelodeon, its sister channel for kids. "We have decided to kick-start the merchandising business for the kids channel with characters from its popular serials," added Mr Hiremath. With the licensing business being bigger than the channel in the US, there are plans to extend the range in India with products such as clothing, footwear, melamine crockery and stationery with endorsements from cartoon characters such as Dora the Explorer and Blue's Clues. In fact, in the recent past, Nickelodeon has also launched co-branded linen for kids in association with Bombay Dyeing.
"The consumer products business is going to become a key business for us and we are expecting a 300 per cent growth over the previous year," added Mr Hiremath.
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