COO | 11 Dec 2002
"Radio, being a free mass media, should be allowed to carry News. Without it, a station is denied its true role as an active community participant."
Sumantra Dutta, after his successful innings with television, is slugging it out. He, as a Radio station honcho, is busy selling the mantra of Radio as an effective medium - apart from helping innovate the programming formats. His recently launched game/quiz show got strong viewer participation.
Here Dutta, Chief Operating Officer, Radio City talks to Ritu Midha of exchange4media on the growth in FM across the country, importance of good content, right strategies, and of course, advertising opportunities.
Q. Lets start with an overview of sorts. At what rate, in your estimate, would FM Radio grow in the country?
Growth rate of FM radio in country would directly be in proportion to how many radio stations are going to be set up at how many places, which, in turn, depends on the Government rationalising the license fee structure. If they don't rationalise the fee structure, not many stations would come up. It was very heartening to see in the press that government is looking at revenue share arrangement.
Q. How would it impact the existing radio players who have already paid the license fee?
For the first group of FM players who have braved the tough time and set up the medium, there would be some kind of SOP from the government of course. One expects that to happen. You can't be a latecomer and benefit. What happens to the early bird?
Q. Coming back to my earlier question, at what rate, do you think will radio grow in the country?
Let me give some statistics. Radio in Mumbai, prior to the launch of FM roughly generated revenue of Rs 22 to 24 lakh. Five and a half months post the launch of FM, revenue has gone to two and a half crore. In a mere six months, because of the five stations the revenue has grown 10 fold.
Growth of radio is like any other media - in first few years it would be exponential. It would be difficult to put a percentage growth on it, but I reckon it should grow 50% year on year in first couple of years, and then slow down to something in the region of about 30%. And then further slow down to about 20% in next couple of years. I don't think we can plan for beyond that!
Q. In your opinion, at what tariff should the radio be sold on, to make some decent monies?
If you were to look at the huge amount of investments in the radio, divide by the inventory that they have to sell, it is pretty basic - to understand that radio needs to sell at 15 to 1600 rupees per 10 seconds just to keep their head above water. I think people who are trying to mark it down, are being as foolish as the people who bid very high at the time of radio bidding. It is an extremely sad occurrence that after being in the business and after understanding the cost behind FM radio, one would stoop to such levels to garner business.
I think FM radio as a category has a sizeable place in media, it has to be positioned rightly. Price of the product also ascertains the benefits that a product gives, lower price always seems to suggest that quality of the product is poor and I don't think that Radio City aspires to be looked at like that.
Q. Are you looking at selling radio and television as a package deal?
Television does support radio extremely well, media plan that compliments television with radio is certainly far more powerful.
However, For the time being we have taken a conscious decision that radio has to be sold as a stand alone, because we need to build the category and draw attention to it.
Q. In radio 'drive time' is considered to be the prime time…
It is a myth. Different advertisers with different marketing goals tell us they have different ideas about what time of day is "prime" for their advertising. It depends largely on the type of product or service advertised as there are those seeking the morning audience, restaurants and movie theatres prefer late afternoons, and some advertisers prefer to target the late night listener, for instance…to order the advertised merchandise through a 24-hour call center.
Savvy advertisers cleverly schedule their spots to hit the listener when they are most susceptible to their message.
Q. Does this reflect in your tariffs? Are your rates same for all the day parts?
Not exactly. We have three different rates, primarily there is a rate for morning and evening, another for other day parts and another one for night. Another rate is the one that works in a 12-hour slot - where your ad would be equally spread through the day. Research has indicated that hearing a message multiple times is more effective than reading it.
Q. But isn't radio, more often than not, treated as a secondary medium?
It is radio's unique ability to be in the background and yet draw your attention with sonic triggers, which makes it a perfect companion. Besides, the moment you opt for content beyond music, radio becomes far more involving. And it is advertisers' creative ability to use this phenomenon to his advantage that can help him reap benefits of the most cost effective and personal medium like radio.
It's a known fact that most individuals spend far more time within earshot of a radio every day than they do sitting in front of any other media. They don't get up and go to the kitchen or the bathroom when a radio commercial comes on the air!
Q. How does a media planner know that his target group is listening to radio? There is research available for all other mediums.
Agreed, there is no accurate listenership data available right now. However music has a universal appeal, and moreover one can actually see the recent trends where people of all socio-economic classes, age and gender have taken to radio. Today one finds an a rich car owner enjoying a Rehman song in his car just as the same song plays on a Rs 60 portable radio for someone traveling in a Bombay local train.
Q. Is it a major disadvantage for FM stations not to be able to carry news?
Radio being free automatically makes it the choice of the masses. It is imperative to be able to provide the masses with news and not keep them away from it. Besides, Local news is one of the USPs of a radio station. Without it, a station is denied its true role as an active community participant. The Government should enable the private radio operators with the same freedom to operate freely and independently, within the limits of public decency and national security, as is given to television channels.
Q. Are you are not planning to experiment with the kind of music you are playing, given the fact that most of the stations have more or less similar music. .
Right now, at the maximum, there are five stations in a city, and hence, it is nothing much to worry about - five stations are not even going to scratch the surface.
We do not want to fool around with the listener who is formed a habit with the medium and we want to kind grow that consumer set. We have stuck to the plan, and we will continue to work according to it.
Sequencing of music and day parts you play it in, is as important as the music you are playing. And over and above music, there are features that give uniqueness to the station. It is also about how the RJs connect with their audience in various day parts which makes radio station special in that part of the day.
Q. Coming to Mumbai, how would you say is market different here from the other markets?
I think it is unique in the sense that all the five stations have come up in close succession, so the dynamics are different. As there are so many players in the city, there is more scope and reason for experimentation. On the flip side, there are people who will go to the market and sell at low rates just for the sake of survival. As it is, there is hardly any ad pie for radio!
Q. Would you say you are better than your competitors in the city?
Well, we have been in the business the longest, having launched the first private radio station in the country in Bangalore one and a half-year ago. Coming to Mumbai, I believe we have pretty well understood what the market wants. We researched the market both from music listenership and music taste point of view.
Our endeavour is to give every city the kind of station, and the kind of music they would like to listen to. And we have hit the right cord there. It is essential that radio is live and has the local vocal flavour of the region. Even the numbers we play are different.
Q. Are you conducting research in these markets to identify the numbers to play there?
Yes, we are doing extensive research. We are using proprietary research, being used by some of the top stations in the US. I believe that we are the only station in the country to be using that research. Through it, we have been able to ascertain what kind of music would local people in a particular region will enjoy. It is a bit like saying the song on your mind is the song on the station.
Q. Coming to the obvious question, do you think you would be able to retain the listeners that FM 91 Suno, Lakhpati Bano brought in?
When there is any contest in any environment in any media, the increase in audience that you get is obviously many times greater than the audience you had before the contest. The audience that has been able to form a bond with the station during the contest period keeps coming back. My personal belief is that most of the people coming on to the station today are coming because of the programming.