Radio: Music & Beyond
Radio, which has carved its history, lived its present is all set to deliver worthy contribution as a part of its future endeavors.
Apurva Purohit, CEO Radio City 91.1 FM spoke at the FICCI Frames on March 28, 2007 at the Plenary Session 9.
“I believe differentiation and segmentation are clearly the need of the hour in the Indian FM radio space and will be a key driver for success.”
Radio industry in India is expected to be the Rs 12,000 crore market by 2010. Nationally, the PwC report states that there will be a boom in the radio industry with 22% growth and rationalization of the license framework will treble its size to about US$ 145.9 million by 2009. How does the industry translate this quantum leap to reality? What are the key drivers which will help bring this about?
With privatization of the FM industry, there are many more FM stations, playing similar music and talking the same talk. There does however, exist a thin line that segregates the wide gamut of radio stations in the market today and here is where the growing need for differentiation gains prominence. All studies across the board are indicative of this. What can a FM station do to ensure listener stickiness? What can keep listeners from habitually flipping across FM stations? What should a FM station do to build and enhance listener loyalty? Increased marketing efforts can only do so much. For how long can increased ad-spends be sustained?Â
Each FM station clearly needs to build brand recall in the minds of its listeners to ensure brand loyalty. For this, they clearly need to stand for something. In such a scenario, there has to be a well-defined proposition; there has to be a well-researched, thought-out, consumer-centric value shift.Â
Differentiation is going to be the key as more and more players come in. The various fringe players will need to find their own niches, be it in terms of segmentation or programming if they have to survive in the long run. The competition and increased marketing efforts will only expand the market for FM radio in India in terms of listenership and advertising revenues.
Internationally radio players have successfully differentiated themselves through audience segmentation i.e. differentiate on the basis of genres. They have jazz, romance, ballet, etc. For example: In London, there was Capital Radio, Heart FM and Magic FM. Capital was a typical mass station catering to Sec A, B, C; 15 to 45 playing all kinds of music and it was a large station for many years. Heart FM today is the No.1 station. Similarly, Magic enjoys high listenership as well. What do these two stations play? Heart plays only romantic songs for a specific TG which is 30-40 year-old women. And, in numbers it has more listeners than Capital. Magic plays a certain sound which is again differentiated from the regular fare.Â
In India, when you look for obvious differentiators, you come to the conclusion that 90% is Bollywood, 10% will be English or jazz or regional. And, therefore, you will get too niche if you build differentiation. But we need to look beyond the obvious.
The third critical driver is a sound measurement system. Radio in India is just about coming of age. The very medium by way of its inherent being has a certain set of strengths such as interactivity, networks, cost-effectiveness to name a few which need to be further leveraged and adequately so. Elements critical to business such as research and marketing of the medium are need-gaps which need to be addressed by the industry as a whole.Â
The Indian Listenership Track (ILT) which measures day-after recall has certain limitations. It asks people as to which stations they have tuned in to yesterday. The respondents tend to recall the most visible station i.e. the stations that they see plastered all over the city in hoardings, when they open their morning newspaper, and in ads on television.Â
Currently, all players invest in their own research with their own set of pre-defined parameters. For the advertisers and corporate decision makers, we need to have a common ‘currency’ which showcases/ reflects the tangible benefits/ outreach of radio. To become a 10% share from the current 3% of advertising revenue, radio has to be able to demonstrate its pay-off to advertisers.Â
Having identified the compelling need for focused research data for the Indian radio industry early on, Radio City proactively took the first step to work in close collaboration with TAM and others to develop a more robust system similar to the ‘Diary panel method’.
The need of the hour is a common playing field for all players. This can be brought about by establishing a widely-accepted, sound measurement system for the industry and by the industry. This will also be a defining factor for growth of the industry.Â