When Radio FM stations were launching in different metros and specifically Mumbai, there were a lot of my colleagues in publication groups who were of the view that this would turn into some monies for them as well. Their view was that if TV Channels can spend around 1 Billion on Press annually (90 to 100 Crores), Radio stations will also use that route to get listeners into their fold. The speculation by some of us however, was that Outdoor and Hoarding companies were more likely to benefit from Radio Station ad spends rather than Press. This piece attempts to look at the 'worth' of advertising by Radio stations… 'worth' because not all of that advertising will be paid for. There could be a substantial number of house-ads or barters.

So what is that total 'worth' (inclusive of house-ads, barters, paid ads) of Radio Advertising in TV & Press? We studied TAM ADEX to find this out and found this number to be just under 20 Crores (180 Million or 18 Crores to be precise) :-

The quantum jump from Rs. 8 Mn to 180 Mn itself is quite stunning. But how much of this is real and how much is an opportunity cost? TAM ADEX splits the in-house ads from that overall quantum to estimate that answer. The results are stunning!

Only 11% of the 180 million appears to be paid whereas the rest seems all in-house ads. Cross-promotion on TV & Press is the name of the game for the Radio companies!

Now even if we in the media business dismiss this advertising as in-house or barter or zero cost, that's not however the way a consumer sees it. A consumer still sees advertising for one Radio Station versus another Radio Station. Hence, its critical to understand which Radio Station did he see more of or which Radio Station promoted itself the highest. The chart below makes that comparison for TV+Press in 2002 and plots the Top 3 Radio Stations in terms of their overall worth of media placed in these two mediums.

There are a slew of Radio Stations which will get launched pretty soon in different Metros/ Mini-Metros and TAM ADEX will continue to study these trends in the immediate future. Watch this space for more!

Atul Phadnis, director, S-Group, TAM Media Research
Source : TAM ADEX (TV, Newspapers and Magazines)

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