Marketing the RCA Personal Radio
At the time of its introduction RCA didn’t realize the eventual impact of the BP-10 personal radio. Although David Sarnoff (RCA CEO) was behind it, most within the company thought that the radio was of no importance to the radio industry nor would gain much public acceptance. Apparently, they were wrong David Sarnoff was right, but not necessarily for RCA.
The following is an excerpt from an article entitled “Adventures in Marketing” which appeared on page 28 of the October 1945 issue of Radio Age magazine. Radio Age was a quarterly magazine produced by RCA for RCA personnel as a source of information about activities within the company.
“A New Exploit in Marketing”
One of the greatest marketing exploits in radio occurred in 1940, when a group of RCA Victor merchandising men decided to ignore the results of a survey and market analysis.
As early as 1922, David Sarnoff had instructed the RCA research staff to keep in mind the development of an individual portable radio receiver—one small enough to be carried like a camera. In 1940, the creation of miniature vacuum tubes and batteries, made this possible. Our engineers and designers came up with what is now universally known as the "Personal Radio". Merely lifting the lid causes it to operate; its tone quality is excellent.
But the marketing of this camera type radio receiver presented new problems. We had to sell at least 25,000 units to amortize the costs of plant tooling, and we had to price the set at approximately $20 retail.
No comparable radio product had ever been sold, so it was decided to run a market survey among dealers. The results were almost completely negative. Dealers agreed that the set was smartly styled, but they said that it didn't look like $20," and that the public "wouldn't pay that much for it." It had only four tubes, whereas a five-tube table model receiver could be bought for as low as $9.95. As a result of the survey, we were led to believe that most radio dealers, being unaccustomed to this type of product, might not be the best outlets or it.
Merchandisers Held Faith
But the merchandising group at RCA Victor did not lose faith. Here is the way they looked at the "Personal Radio".
- It was new and novel.
- A demonstration created the desire to own one.
- It had a new and smart style, and could be featured in the most fashionable stores. Name personalities would be proud to own and use one, and their name or initials could be engraved upon its jewel box case.
- As a gift item, it was a natural.
- It appealed to the impulse buyer.
- It was easy to use, convenient to carry.
So the enthusiasm of our merchandising group won! A comprehensive program of manufacturer, distributor and dealer activity was developed to cover all phases of merchandising with intensive advertising, sales promotion, publicity and initial exploitation in the metropolitan New York market. A careful distribution of sets to radio artists, columnists, and leading stage and screen personalities resulted in an exceptionally fine reception. Lucky owners found themselves demonstrating the sets to their friends and acquaintances at home and in fashionable meeting places. Such ideas as the use of this set in the musical, "Walk with Music", playing on Broadway, resulted in extensive interest and comment. Magazine pictures revealed that one was on the President's desk in Washington.
Backed by a generous advertising budget, including full page advertisement in several New York papers, the sales campaign featured a broad scale tie-up at the New York World's Fair. Remarkably enough, less than half of the original advertising budget allocated for this campaign was used, yet the first 25,000 radios were sold out in the first thirty days. Retailers, who originally turned down the opportunity to buy jumped on the band-wagon and the rush was on. With such acceptance, the question arose as to the next market to be opened. It appeared that the one additional major field where we could fully capitalize on the initial momentum generated by the New York campaign was Hollywood.
By that time, the early enthusiasm had generated into company wide interest. RCA Victor executives were photographed in shirt sleeves loading the first freight cars for the Coast. The "red carpet" was out when the sets arrived in the West, and an intensive promotion campaign had been organized, in the best Hollywood manner. With the cooperation of the National Broadcasting Company and Warner Brothers, an exploitation campaign was started with practically every star on the Warner lot using this "Personal Radio" in still photographs for advertising and sales promotion.
Instead of selling only 25,000 "Personal Radios" during two summer months, we sold more than 225,000 in six months. Faith in the product, backed by the imagination and drive engendered by faith, turned the trick.