The Resurgence of Radio in India
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FM RADIO'S SUCCESS STORY contd...
The strategies followed by the players varied from one radio channel to
another. Radio City's market strategy was developed after six months of
intensive research conducted in Bangalore. As part of this strategy, the
company focused on creating brand name and brand awareness, before moving on
to specific target programming.
Sumantra Dutta, COO, Radio Division, STAR,
said, “What we are looking at is the first mover advantage. We are the first
private FM radio station in India, and we plan to cash in on this.” The
company identified music as a universal theme appealing to all sectors of
the community. It therefore offered music-based programs in both English and
local languages.
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In order to broaden its appeal, the channel also
offered programs such as the ‘11 o'Clock Show'on beauty tips and the
‘Breakfast Show'offering the day's horoscopes. Apart from these, the
channel offered a range of entertainment programs 24 hours a day. These
programs were customized to the needs and tastes of local listeners on
the basis of customer research. Radio City also signed a contract with
Newscorp to leverage the best international talent in the fields of
technology, research, engineering, sales, marketing and programming.
The target audience for Radio Mid-Day was however, car owners. The
channel's programs targeted car owners, who had to spend hours stuck in
the traffic. For the afternoon slot, focused on offering programs that
appealed to housewives. Rajesh Tahil, Head of Radio Mid-Day, said, “In
the afternoon slot, we will have to compete with television for the
attention of housewives. What we are aiming at is the top 20% of the
radio audience. Thus we have decided to choose an audience, and go with
it.” |
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The increasing popularity of FM resulted in
considerable growth in the advertising revenues earned by radio companies.
Seeing the growing listener base of FM radio, many companies increased the
share of radio in their total advertising budgets. Many leading brands such
as Kwality-Walls, Spice, Tanishq and Airtel advertised heavily.
Private players and analysts were optimistic regarding the future of the
radio industry in India. In the words of Nirvik Singh, M.D., Grey Worldwide,
India, “The share of radio is limited by the medium's current delivery.
Given a free hand and the competition, there is no reason to believe that
the medium which delivers in every other country will not perform well in
India.” Analysts pointed out the success of radio (increase in number of
radio stations, ad spends and market) in developed and developing nations in
the 1990s.
In the US, there were more than 11,400 radio stations that served nearly 240
million people and attracted over 13% of the total ad spend. In Australia,
there were over 850 radio stations, with ad revenues increasing by an
estimated 7% annually. In UK, ad spend on radio amounted to an estimated 6%
of total ad spend in the country.
Even in developing nation like Sri Lanka, the radio industry was reportedly
attracting 14% of total ad spend. In light of these facts, analysts remarked
that, given appropriate marketing strategies and awareness, radio had the
potential to capture the public's attention in both rural and urban areas.
A BRIGHT FUTURE?
EXHIBIT I - WORKING OF A RADIO
EXHIBIT II - HISTORY OF RADIO WORLDWIDE
EXHIBIT III - INDIAN RADIO MARKET (1975-1998)
EXHIBIT V - PROJECTED MEDIA REVENUES
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