According to various industry reports, radio did not grow as per the projected value in 2012. While broadcasters witnessed local brands coming on board throughout the year, the advertising spends on the medium did not grow as expected.
Apurva Purohit, CEO, Radio City explains that the situation is not as bad as it seems and the roll-out of Phase III will change the scenario further more. In conversation with exchange4mdia, Purohit elaborates on the advertising model the industry follows; content formats that work and AROI’s self-regulation agenda.
Is the cost effective model of advertising working for the industry? Is it time for the radio industry to change its advertising model?
Radio as a medium is a very interactive and a high engagement medium. It offers a unique platform for marketers to build in interactivity with their consumers. For Radio City, constant engagement with the consumer on-air and on-ground through our differentiated marketing properties has shown unprecedented success with responses ranging in the tens of thousands, as I am sure is the case with other radio stations. Somewhere the industry has to take cognizance of this and moved from a cost per thousand approach to a cost per interaction/ engagement approach. And clients need to be willing to pay a premium to get this kind of consumer connect. I believe media agencies have to take a differentiated approach while evaluating radio, rather than using a typical CPT buying behaviour.
Radio City increased ad rates in August 2012, how has it worked for the station?
The ER increases that we take from time to time are based on a scientific analysis of the value that Radio City provides to our clients as well as the demand – supply situation in the market in terms of availability of inventory on our stations. At any point, when we increase our ad rates, the returns in terms of RoI continue to be the same or better for our clients and this has definitely worked in our favour. As leaders in the market, we don’t take mere price hike but we work at making the rates relevant to the deliverables we provide to our advertisers. The fact that our inventory in all our key markets continues to be full, proves that it has been a win – win situation for both, us and our clients.
According to the Pitch Madison Report, radio’s share in advertising pie is expected to fall from 3.2 per cent to 3.1 per cent. Please share your views on this? Do you think radio fraternity has more to look forward to as compared to last year in terms of advertising?
The year 2012 has been significant for us in terms of growth in advertising revenues. The industry as a whole has witnessed around five to six per cent growth in 2012 and owing to several factors including our leadership position in key market, Radio City has managed to notch up a growth figure which is more than double the average industry figure, as indeed have some of the smaller regional players. I, thus, do not believe that share of radio advertising has gone down or will go down. Clearly, the recent announcement of the Phase III roll-out is the impetus that the FM industry needed to catapult it into much higher growths; so, I believe that sooner rather than later you will see radio revenues go up to seven to eight per cent.
A number of new content formats were introduced on Planetradiocity; are there any plans to introduce new properties on the terrestrial Radio City station?
The success of web radio for us as well as the huge increase in online entertainment consumption has emboldened us to continue the stream of innovation on our digital platform; so you will see a number of new stations of different types of music getting launched on Planetradiocity. Across our 20 terrestrial stations, there is constant new activity and local properties getting launched, which are in keeping with both, city-specific issues and the mood of the city at any time.
Radio listeners are no longer the passive counterparts, they like to chose from the content they are being served. What, according to you clicks, with listeners these days?
Why only radio, I think across the board consumers are picking and choosing what they want to listen to, when they want to listen to it and how they want to consume information or entertainment. The growth of consumption of information and entertainment via digital is testimony to this change. As consumers become more interactive, radio actually provides a perfect platform for them to have their say whether it is by voicing their opinions or participating in a talent hunt or even voting for their favourite artiste. I think radio is the only medium today which can effortlessly transition itself from being part of the more traditional basket of media vehicles, which were typically passive in nature, to becoming part of the more interactive new-age media vehicles. TV and print can’t do that and that is why I strongly believe in the future of this medium!
Radio City’s property Love Guru completed 10 years recently. What, according to you, is in the property that clicks with the audience? Are there any plans of re-branding the property?
Having been around for more than 10 years now, Love Guru is a brand on its own. Possibly the most recalled radio show in the country, ‘Love Guru’ is a one-stop destination for all love problems. His presenting style and his inimitable voice blends the best of old-school radio and modern relationship advice. We recently launched ‘Love Guru’ merchandise as a natural extension of the brand which completely resonates with Radio City’s objective of establishing a personal connect with our listeners. With the launch of this merchandise, ‘Love Guru’ acquires a tangible persona. It consolidates Love Guru’s presence in the lives of the listeners.
You have been the heading the self regulation mechanism initiative planned by AROI; can you share what are AROI’s plans on this front?
We are in the process of formulating both, the code of conduct with regards to self-regulation as well as the process for monitoring and redressal, which we will be sharing with the ministry officials shortly.