With the Aadi festival season round the corner, FM players in Chennai are not only planning content around the festival, but also courting the retail segment to generate more ad revenues. Chennai gets converted into a potpourri of retail discounts, sales, promotions and shopping frenzy during Aadi festival that the FM players are looking to tap.
Retailers invest heavily in advertising and brand promotion during this season. With eight FM radio channels in Chennai, and considering the fact that radio has the traditional image of becoming the retailers’ best friend, the moot question is has this relationship been established in Chennai yet?
Kavitha Srinivasan, Business Director, MindShare Chennai, said, “Print and television are still the must mediums for the retailers. Radio and film screening are optional in the absence of outdoors. However, radio is proving to be a cost effective medium. Since retail advertisers are banking on promotional activities for most occasions, FM becomes a critical part of the plan, especially when retailers have geographical restrictions. However, FM stations have not really been able to increase their revenue base. Though the revenue stream peaks during the seasonal Aadi fever, this has not resulted in additional revenues to the stations this year.”
Sandeep Sud, VP & Cluster Head, Radio Mirchi Chennai, is confident about a steady growth ahead even if the present situation has not been very rewarding revenue wise. He said, “Radio is definitely proving to be one of the most cost effective of the above the line advertising mediums. In the absence of outdoor mediums, the advertiser is leaning to the next best medium that provides him high frequency at affordable rates, and that is radio. As the old adage goes ‘The proof of the pudding lies in the pie’, revenues from the retail sector account for (in excess of) 70 per cent of the total revenues of most radio stations in Chennai. With a number of them as repeat clients, it would be right to say that radio is certainly delivering in Chennai. Revenue base for Radio Mirchi Chennai has certainly increased in this peak hour of retail advertising.
However, we believe that it is just the tip of the iceberg and we hope to be able to realise the full potential of this by the next (Diwali) season. The dynamic retail market still has lots to offer radio, and with customised programming solutions, we will definitely win the confidence of the retail market and hope to grow the radio market by the end of the year.”
Narendra Kumar Alambara, General Manager, Starcom Worldwide, Chennai, sees a lot of scope for innovation, which the FM players are yet to come up with. According to him, “While radio players have had the opportunity to increase their revenue base from retailers (not necessarily in the peak season), I do feel they have not capitalised it well. Lack of differentiated programming has created virtual clones across stations, making the listener switch stations frequently, making them averse to advertising. Furthermore, advertisers, too, have not used the medium to the full potential with uninspiring advertising and creative units (not originally created for radio).
He added, “From the current low shares, radio has the opportunity to grow and gain a larger share if the medium adapts to the advertiser needs and in turn, the advertiser utilises the potential that the medium offers. The power of print will always have an impact and will continue to be the medium of choice for the retailers. Out-of-home media is another option that was used extensively by most Chennai retail client till recently. Even the regional media options in high reach media like satellite TV does provide an added impetus within the local market.”
For Bharat Vishwanathan, AVP Sales - South, Hello FM Chennai, “FM stations have been successful in adding retail advertisers to their revenue kitty. We’ve had a huge surge of retail clients this Aadi season. General media habit has been to offer discounts. But we have tried to protect our price rate. In fact, we have turned down a lot of small size retailers in order to maintain a healthy corporate balance and maintain the colour of our channel. Rather than a general spot on television, where innovation is restricted, the quantum of innovation is high on radio. Only very high end clients can afford the level of innovation that TV offers. In print, innovation is highly restricted leaving the clients with radio as the only medium for innovative solutions in a cost effective way.”
Sandeep Makam, Managing Partner, be positive 24, said, “Our clientele consists majorly of retailers. We suggest the medium of regional print magazines and film screening as the most effective medium to our retailers.”
On a pragmatic note LV Navaneeth, Station Head, Radio One Chennai, said, “No, retailers haven’t invested drastically well in radio despite the limitations of OOH in Chennai. However, radio has started becoming a part of media plans. It is definitely not an ad hoc medium any more. Even retailers are carefully watching the market and are a little wary of it. They are saving, but not spending. Cost of OOH media has gone up with lesser visibility, and radio is definitely taking advantage of that.”
PB Ramaswamy, Cluster Director, Big FM Chennai, is highly optimistic about the future of radio in Chennai and accepts the fact that the medium is still not treated with seriousness vis-à-vis television or print. According to him, “The first thing is we still have space. The way the corporates have starting using radio, the retailers have started catching up with that. We are looking at a scenario where retail goes to a level of 70 per cent of our revenue. Radio is the most cost effective medium for retailers. TV channels are getting desperate to the level that they have started cutting costs. The seriousness towards radio as part of a media plan is definitely lesser right now. But the way radio listernership is catching up and the fact that the price that we are offering is less than TV, radio is still a cheaper option offering a high frequency for retail.”
He further said, “Radio has been able to cash in from the no hoarding situation, especially during this Aadi season. I have taken away a very quantifiable amount of money from the retailers for Aadi. But will that money continue to keep coming in, is the question of the hour. Outdoor is a visual medium, so unless and until radio is able to offer some innovative alternative close to that, how can it can compete with some other medium?”