The Resurgence of Radio in India

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FM Radio's Success Story Contd...

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.

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."

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.

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