Industry Speak: What is the Return on Investments from contests on radio stations?

Industry Speak: What is the Return on Investments from contests on radio stations?

Author | Jagadeesh Krishnamurthy | Thursday, Sep 27,2007 8:50 AM

Industry Speak: What is the Return on Investments from contests on radio stations?

It’s raining contests on private FM radio stations these days, with nearly all players running contests across their networks. These contests, usually with loads of gifts thrown in for the winners, attract quite a number of advertisers as well as listeners. exchange4media spoke to some of the players in the industry to understand their reasons for running contests on their channels – Is it listenership that drives them or is it the monies that they bring in?

Kaushik Ghosh, Senior VP – Marketing, Radio Mirchi, stressed that there was no study or figures to find out whether contests increased listenership or not. He elaborated, “During the launch phase, a good contest can create buzz around the brand. At later stages, contests can be used as clutter breaking programming initiatives that can be utilised for revenue generation. We pioneered in this activity and we can create properties for clients through these contests as well. So essentially, contests help in increasing listenership in the beginning, and it then slowly converts to revenue generation.”

Abraham Thomas, COO, Red FM, noted that they had a diametrically opposite view on contests and their utility. “Our own research shows that contests are for 'contest-junkies', who take part in all contests across all stations. However, these contest junkies account for an insignificant per cent of the audience and have no brand loyalties. At Red FM, we believe that contests are for all those millions of listeners who do not participate in contests themselves, but feel gratified by solving the puzzles and that they could have won the prize. So, contests may not bring in new listeners, but help in satisfying the 'I-know-the-answer' feelings in the existing listener,” explained Thomas.

Radio One’s VP, Programming and Brand, Vishnu Athreya, believes that there is no formula for finding out immediate Returns on Investments (ROI). “The ROI depends on the scale and the contest organised. For us, with some contests, we had both -- a sizeable increase in listenership as well as revenue generation. Most importantly, ROI depends on the objective of running the contest. Contests on radio help us gauge response for a particular activity, and sometimes it also helps us hold on to our listenership base,” he elaborated.

Radio City is primarily looking at increasing listenership with contests. Rana Barua, National Head - Marketing, explains that contests help in sampling. “With contests, new listeners tune in and sample our products. They can be run at various stages – like when a new station is launched or when there is a change in the programming. These contests will then help in understanding the listenership preferences. For us, revenue generation is a secondary objective. Sponsors do help in covering expenses, but it’s sometimes difficult to get sponsors for some contests. If there is a link between the brand and the contest, then we can kill two birds with a single stone – increasing listenership as well as earn more revenue,” elaborated Barua.

Anand Chakravarthy, Marketing Head, Big FM, observed that contests always worked as they gave instant gratification. “Contests are a powerful tool of radio, but they alone can’t run a station. The contests have to be unique and consumers have to be enticed to participate in them. As a brand, we use our contests as a property to sell to our clients and everything is worked out before launching a contest,” he said.

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