Growing up in an industrial town in the 1980s, I remember waking up to the strains of the radio on school days, and then timing myself for the school bus by listening to the programmes. Years later, I jumped on to the digital music bandwagon as soon as it was launched in India, but I’ve noted with concern records, cassettes, and CDs going out of vogue, for I am a collector of these things. I also noticed that people of my parents’ generation with access to FM radio were listening to stations playing old music most of the time, but liberally cursing them for the torrent of advertisements. When I first got my hands on the Saregama Carvaan, the retro-looking portable digital music player, a few weeks after its launch in May 2017, I thought here’s something my parents would really like. Uninterrupted music. No ads at all. A little dipstick survey among friends last year revealed it was the most popular gift for the festive season.
The Carvaan sold a million units in just 18 months after its launch. For lovers of old Bollywood songs, the attractions of the Carvaan are many. It has 5,000 old Hindi film songs spanning 50 years all the way from movies as old as the 1953-released Aah starring Raj Kapoor and Nargis to classics from the 1990s such as 1942: A Love Story. It is designed for a generation whose favourite music dates back to a time before the digital age. Much like the traditional Indian beverages brand Paper Boat or the recently-relaunched Jawa motorcycle, the Carvaan is all about nostalgia— old classic hits packed in a modern device with a classic design. “Music is something that evokes emotions and memories,” says Jehil Thakkar, partner, Deloitte India. “It is the flood of all those special memories associated with a song which makes people connect with the Carvaan,” says Vikram Mehra, managing director of Saregama India, the company that makes the Carvaan.
But behind the success of the Carvaan lies the story of reinvention of its maker. A few years ago, Kolkata-based Saregama India was staring at a ‘Kodak moment’: Much like the photography giant, it was also hit by the growing popularity of the digital medium. India’s oldest music label was sitting on a gold mine of rights to 120,000 songs in 14 languages from which it was earning dividends, but the company’s revenues were stagnant and the lack of new content pinched.
The company was determined to claw its way back to its glory days. In an earlier avatar—when it was called the Gramophone Company of India—it released India’s first ever studio recorded song in 1902 and was big during the time of LPs and the gramophone, which it retailed under the brand name HMV. Its slide began after it was slow to get into the cassette business, and then it repeated the mistake with MP3 CDs—the preferred format for storing and selling music for some years from the mid-2000s. As business slowed, Saregama conducted a study of music consumption behaviour in 23 cities across the country in 2015. It found people above 35 years living in non-metro cities had a major gripe: They loved their Lata Mangeshkar and Kishore Kumar but “didn’t get to hear them easily”. Mehra recalls some of them complaining, “Why have you stopped releasing your music?” The music was available, but it was in digital form which had to be accessed via phones or computers—something this generation was not comfortable with.
I’m a huge Steve Jobs fan... but ...you need togo back and listen to the consumer.Vikram Mehra, managing director, Saregama India
“That crowd had some amount of fear with a product where they have to press buttons, they don’t know by pressing which, what may end up happening,” says Mehra, “because many of the digital products are made keeping in mind the younger audience.” Meantime, Reliance Broadcast Network began to broadcast old catalogue music extensively on its Big FM radio channel. “Radio really found a market. That’s when folks realised, ‘Look this is a market that has a lot of potential’,” Thakkar says. And that’s how the Carvaan was born. It was a simple idea to combine digital technology with physical music, but the portable radio caught on like wildfire.
A Kotak Securities report says Saregama sold 380,000 pieces of the Carvaan in FY18 and it aims to sell 750,000 in FY19. Mehra attributes the success of the Carvaan to his team’s mantra of listening to the consumer: “I’m a huge Steve Jobs fan, but one thing I have a big disagreement [on] is he always believes that a consumer does not know what a consumer wants. But I am a big believer that you need to go back and listen to the consumer.” He says all aspects of the Carvaan, from the concept to the design of the prototypes, was informed by feedback from “the right audience”.
Mehra was confident of the volumes the product would generate. But he thought it would be tucked away in bedrooms; instead, it occupies pride of place in the living room. The firm learnt some users took the Carvaan—prices of which start around ₹6,000—along when they travelled or went on road trips. This led to the development of the Carvaan Mini (priced at ₹2,490) with an eye also on millennials. Mehra was taken aback by the daily average listening time in the 60-plus age group—7½ hours. He says: “For the retired, this is how radio used to be heard earlier.” Thakkar adds: “It’s design thinking in its purest form.”
The Carvaan has been Saregama’s talisman. After low profits in FY16 and FY17, Saregama saw a sharp spike in its profitability in FY18. The company’s stock price has more than doubled since the Carvaan’s launch in 2017. Saregama also got back to “acquiring songs of both new Hindi films and Tamil films”. Besides an updated Carvaan and Carvaan Mini in 2018, it also launched Carvaan Gold which has Harman Kardon speakers for discerning listeners. “Our objective is to take our content to as many people as possible,” Mehra says. “So, all future products, too, would be to that end. Our objective is our music should be available everywhere.”
The Carvaan has helped Saregama return to its old glory. The company began life in 1901 as the first overseas branch of the London-based Electrical & Musical Industries Ltd. In 1985, when RPG Group took over the company it was called The Gramophone Company of India Ltd before the buyers renamed it Saregama. When it decided to move along with the times, Saregama took stock of its strengths—good lineage and an exhaustive trove of classic songs. It might have been earning dividends from its Saregama catalogue, but it was also making losses in its television production business. It has over 3,000 hours of television content, according to a Phillip Capital report.
Telecom operators, which provide a chunk of revenues to content providers, were also having a tough time. As their margins narrowed and average revenue per user fell, they passed on the pressure to content companies like Saregama. Thakkar says the market for catalogues was not big, and worse, it was shrinking. Most content firms faced the problem that “nobody wanted to license the catalogue. So they were motivated to do something on their own”. And that is what Saregama did. The company’s moment of epiphany happened when its survey team heard an elderly woman in Kanpur reminisce the good old days. She would switch on the radio in the morning as she cooked for her family.
The programmes signalled the time for her children to leave for school and for her husband to leave for work. “I remembered my old home. All those who grew up in the 1960s and 1970s would remember that Vividh Bharati used to be on in their homes all the time. [So were] we making a mistake by assuming that every consumer wants an immersive experience while listening to music?” asks Mehra.
Saregama believes its 120,000 song strong catalogue is a national heritage which must be “passed on”. Mehra believes children who spend time with their grandparents who use the Carvaan get to listen to good music. But he says it is more gratifying to know that the next generation won’t grow up alien to the experience of enjoying music the good old way.