Richard Blade was the guest star of my summer vacation, and for that I have Sirius XM Radio (Nasdaq: SIRI ) to thank.
If you don't know him, Blade is a deejay who regularly spins '80s and early '90s tracks for Sirius' "First Wave" station. Hearing him during our recent family trip to and through portions of the Redwood National Forest brought back good memories of listening to his "flashback lunch" segments on Los Angeles radio station KROQ.
My wife and I couldn't get enough. As Depeche Mode's "Policy of Truth" crooned through the minivan speakers, Sirius XM had us.
Marketing on the cheap
Color me impressed. Sirius did exactly what other great marketers do, creating an environment where I could play with its product as much as I wanted, and in any way I desired. Sirius let me explore, in much the same way as Google does when it releases software into the digital wild. Or how Microsoft lets gamers thumb their way through Xbox games in its new retail stores.
The marketing was also subtle. A simple brochure accompanied my rental agreement. Inside I found a channel list, phone numbers, and this simple pitch: "Sirius XM is the perfect travel companion. Whether you're traveling for business or pleasure, Hertz rental cars equipped with Sirius or XM Radio provide an enjoyable experience for any journey."
Simple, on point, and delivered at what appears to be zero cost. Hertz Global Holdings (NYSE: HTZ ) pays to have Sirius XM in its vehicles, as do the Avis and Budget operations of Avis Budget Group (NYSE: CAR ) . All told, Sirius reported 116,056 rental subscribers as of Dec. 31, 2009.
Tuning in to a growth opportunity
Interestingly, that's a pittance compared both to Sirius' overall subscriber base (on pace to reach 19.9 million by year's end), and the number of U.S. rental cars in service (1.64 million, according to the latest data provided by Auto Rental News).
Sirius serves just 7% of the U.S. rental installed base, which means the satellite radio superstar may be less subject to the whims of Ford (NYSE: F ) , General Motors, Chrysler, and Toyota (NYSE: TM ) than skeptics like me have long assumed. It may even be the other way around. Nearly two-thirds of all new cars are equipped with a satellite radio, media reports say.
There's a good reason for this: satellite radio works.
I know, I know. I'm late to the game in admitting that Sirius has a point. The truth is that it took me driving to a remote area of northern California to understand how much satellite radio outperforms terrestrial options. Everywhere our iPhones failed to pick up a signal, Sirius XM worked as advertised.
To be fair, this isn't a huge issue if you have an iPhone or iPod loaded with music. Plugging into an unused terrestrial band using any number of car kits transforms these devices into mini-radios.
Nevertheless, the point remains: Sirius XM is easy, and functions just about everywhere. Earth-bound broadband options such as WiMAX networks aren't pervasive enough to be reliable for on-the-go streaming delivery.
And that's an issue. As a society, we're getting more rather than less mobile. We spend hours commuting and use gadgets while on the road -- often to our detriment. Sirius XM could help us solve this problem by teaming with Google, Intel, or another tech supplier to create an alternative to Microsoft's Sync in which Sirius XM receivers would act as a sort of gadget hub that prevents unsafe practices, such as texting while driving.
Get into my rental car, Sirius
Of course, I can write that and enjoy an unseen chorus of nodding head, yet it won't make a bit of difference unless Sirius XM finds more ways to get its service in front of drivers.
Satellite radio is an out-of-sight, out-of-mind experience that can't differentiate itself on the Web or in a brochure. But in the car, in a remote area, it's the one indispensible service drivers can rely upon. A pervasive rental marketing strategy that exposes more drivers to Blade, Howard Stern, and Oprah could help illustrate this truism and at the same time boost revenue.
How would you market Sirius XM Radio? Sound off in the comments box below.