RadioandMusic
| 25 Jun 2019
FM round up west - Steady growth

After featuring the south, north and east FM scenario in 2008, radioandmusic.com completes the FM roundup with the west scene.

2008 was a tough year in general for media in India, but radio managed reasonably well during the year.

Believes Radio Mirchi CEO Prashant Panday, Fuelled by growth in network, the growth rate of radio in the first half of 2008 was as high as 55-60 per cent on a year on year basis....

Radio city EVP and national sales head Ashit Kukian adds, We are extremely happy with the way 2008 has gone, especially with respect to the launch of our two new verticals Planetradiocity.com - our music portal and Radio City Connect, our activations division....

Red FM banked heavily on its outdoor campaigns to consolidate the station's position in Mumbai. Our positioning can be attributed to our strength of programming, RJs, superhit music, innovative and interactive properties and campaigns such as Red Mike, Bajaate Raho Awards, Bajaao for a Cause, etc. and its attitude of always Bajaaoing issues that matter to the common man,... adds Red FM national marketing head Anuj Singh.

Revenue growth has indeed slowed down, observes Panday, However, the fact we occupy close to 45 per cent share of the private FM market helps in staying profitable. Even as margins have come down, market share has only grown. Most radio broadcasters including the ones occupying the second and third positions in size are making huge losses....

Although Radio Mirchi hasn't announced its OND numbers yet, Panday adds as a matter of fact that in the April-September 2008 period (first half of the current financial year), Mirchi revenues increased by 26 per cent on a year on year basis.

Advertising

In the western region, the radio players exploited their advertising inventory exhibiting the cost effectiveness of the medium in times of recession in the last half of 2008. As Tomato FM (Kolhapur, Sangli) CEO Naval Toshniwal says, In terms of advertising, we were strong on the local side with occupying more than 80 per cent, but now corporate is also picking up and the ratio has changed to 50-50 per cent....

The industry is now looking forward to cash in on political ads in the forthcoming general elections; however, the smaller stations enjoy the bliss throughout the year. Political ads have increased our advertising volumes, as we air birthdays of political leaders and also info ads about their political meetings on a regular basis,... states Toshniwal.

As an industry, radio got a shot in the arm when the government allowed political advertising on private FM. Though we have still not benefited from this, we expect to make anywhere between Rs 500 to 750 million from political advertising in the April ÔÇô May period next year ÔÇô before the general elections,... adds Panday optimistically.

The global slowdown has had its impact too. Panday emphasises, In the OND quarter, things have been rough and revenue growth has slowed down. Losses have mounted and cut-backs in headcount and paycuts are the rule of the day....

Contradicting these thoughts, Toshniwal says, Recession has proved as a boon for us as advertisers have realised that it is a cost effective medium and radio is enjoying that extra mileage over other mediums. Also talking about effectiveness of reaching locally, radio and print is preferred over TV and now radio is getting all the attention as it is cheaper than print....

Echoes Kukian, I think it is a great opportunity for the entire radio industry to reiterate the medium's effectiveness and high ROI for brands wanting to use micro or localised marketing as a strategy to manage the slowdown.... Radio city saw an increase of 45 per cent in terms of number of advertisers and advertising volume. Their advertising comprises 70 per cent of national and 30 per cent of retail advertising.

Fever in Mumbai occupies about three and half to four per cent of the listenership. We have been consistent last year and our focus would be to have a double digit figure till the year end. We have 13-15 per cent of the advertising share and the advertising profile includes media and FMCG primarily,... says Fever's Neeraj Chaturvedi. Most of the advertising for the station is corporate which occupies 60-70 per cent. Chaturvedi adds, Local retailers haven't picked up and it will take time to develop....

Panday affirms, We offer regional... solutions to national clients ÔÇô we make separate creatives for separate states ÔÇô depending on the needs of the brand state-wise. We offer solutions to retail clients who are reeling under the price rise. We reach for those segments of the advertisers who cannot use any other media because of high entry costs or ineffective reach. As part of our D&G (Disaggregate and Grow) strategy, we have strengthened the Mirchi Activations business ÔÇô a segment where we have a market share of close to 80 per cent.... D&G has ensured that we have been able to grow market shares inspite of a severe cut-back in client spends.

Key initiatives

Talking about their marketing initiatives, Panday says, Radio Mirchi has focused on one single strategy ÔÇô Disaggregate and Grow. Essentially, the strength of radio is that it is local and electronic in nature. So in a way it's a combination of print (local) and TV (electronic). So, we have attempted to position radio as local TV ÔÇô which does not exist in India (since terrestrial TV is not permitted). Additionally, the fact that radio provides tremendous reach makes radio a strong contender for advertiser monies ÔÇô especially in these recessionary times....

In 2008, Red FM tied up with the IPL team Mumbai Indians and turned ÔÇ?Blue' for a day. Singh says, Everything from the station colour to the station ID was changed for a day to reflect the colour of Mumbai's Home team in the IPL. Amongst its other initiatives for the same, we built a Mumbai Indian cheering team which went to Wankhede Stadium atop an open air double decker bus to cheer for the Mumbai Indians in their famous match with the Kolkata Knight Riders. Besides that, Red FM gave away match passes, merchandise and lots of goodies to listeners across the city....

Also, another example of brand activations was the Bajaate Raho Awards which went on-ground in a glitzy award ceremony for the first time since its inception two years back.... The awards celebrating the ÔÇ?depths of excellence' in the field of entertainment had spoofs of various bollywood stars, TV personalities, etc. along with some sizzling performances by stars like Bappi Lahiri, Mika, etc.

Having faced transmission issues in the first half of the year, Fever shifted its transmission tower mid year and is now campaigning to inform the listeners about their clarity. Chaturvedi elaborates, The government had promised Common Tower Infrastructure (CTI) to every player and we had to settle with what was provided to us. Our tower was at a lower height than average and had some dark areas where our transmission was not clear....

Looking ahead

2009 is not going to be an easy year for any industry. The players however cannot predict the extent, however. Says Panday, If the several initiatives being planned by the government play out and the economy does get a boost, the radio industry would be seeing a recovery as early as April 2009. If not, then we may be in for a long haul of slowing growth....

Panday avers, Mirchi will focus on providing solutions to clients, we will build on D&G even more strongly. We will stay client focused and will attempt to increase our market share to over 50 per cent....

Fever launched a campaign ÔÇ?Sun Mumbai Sun' to inform Mumbaiites that the frequency problem has been corrected and that the station is audible all over the city. Fever 104 FM's National Marketing and Promotions Head, Gowri Satyamoorthy Kapre says, We would be banking on brand activations as it is an advantage for a brand and delivers us brand visibility. And brand salience for us and are open to lot of innovations....

In the coming year, the radio industry also expects concessions from the government to alleviate some of the severe pressure that has been existing on the radio industry since the beginning ÔÇô more spends from government departments on radio, lower CTI costs, and indeed an increase in the license period of Phase II licenses. The industry also expects government's support in helping resolve the contentious issue of music royalties ÔÇô a case of clear monopolistic abuse of power by the music industry.