CEO | 24 Sep 2002
"We cannot hold on to such high listenership figures for long. We'll be happy with a 35% share of listenership."
With two of five stations reportedly pulling out of Delhi market recently, market was filled with Chinese Whisper. Amidst these stories, we met the honcho of the radio station that is presumably doing exceedingly well - AP Parigi, CEO of Radio Mirchi.
Parigi with his years of telecom experience, last he was the CEO of BPL Mobile, has managed to give his station a head start. If the initial listenership research numbers are to be believed, Radio Mirchi is several times ahead of its nearest rivals. But Parigi is quick to acknowledge that such a high shares will give way to modest leadership position, which is his target.
In an animated conversation with Amit Agnihotri of exchange4media, Parigi share the dynamics of Radio operations, his perspective on recent changes in programming formats and defends the argument that Radio Mirchi is catering to lowest common denominator in Mumbai.
Q. Share with us the journey at Radio Mirchi thus far. Some time back, programming of Mumbai station changed to predominantly Hindi. Isn't that true. What is rationale behind this shift?
Radio FM avatar, in India, as you see growing today in leaps and bound is different in several ways from the original time-slotting by AIR FM avatar. Earlier it wasn't an integrated radio corporation. You did not own the transmitter, you did not own the dynamics of the format, you did not have the adequate time and you could not promise an associate sponsorship or a sponsorship. Things that go to make radio medium popular with your clients.
Mirchi was first of the block in Indore. Reason? The reason for choosing Indore is that a lot of audio research testing has been done here for new movies and songs. It is a barometer of sorts. Then from Indore we went to Ahmedabad, Pune and Bombay. By October this year we will complete one year in operation.
And one year is a decent time to evaluate once performance and draw learnings.
Our research shows that initial experiments in Indore were a phenomenal success. The average daily radio listenership, before Radio Mirchi, was about 49 minutes. It has moved to 123 minutes a day in a 4 months timeframe! This reflects awesome appetite for entertainment that we can satisfy. This compares very well with the average time of television viewership in Indore- 129 minutes.
Overall the 'formats' in radio programming are very important. As a company, we respond to research and market feedback and keep pace with it.
We started by giving weightages to programming formats and languages. Recently we said, 'we should have little more Hindi.' So yes, we have taken a very conscious decision to have a Hindi bias. But Radio Mirchi is not a Hindi station out and out.
Q. Who then do you target?
In terms of demographics, our audience falls in SEC AB, in age group of 15- 35 yrs. But more importantly, we asked ourselves, if Radio Mirchi was a person who'd it be? The answer we arrived at was, 'she would be a college student, sitting on the compound wall, charming fellow collegiate.' Extremely good in extra curricular, but average in academics. That's the persona for Mirchi!
Q. Mr Parigi, is Radio Mirchi going Hindi a reaction to competition? Most other stations are playing predominantly English tracks...
No, it is not a reaction!
Here we need to step back a little and say how do we visualize the market structure of radio FM. When you put enormous amounts of money, people like us sit back and think 'what could be the scenario a few years down the line.'
We believe in Media, and also in Radio, there will be two brands in leadership position and you will have one or two brands, which either go to niche or they start becoming a bit of followers, and then one or two brands taking violent swings. So you will find that only one or two, at leadership status.
You have listenership on one hand and advertisers on the other hand. Every programme or every format should respond to listenership, how do you fare it. At this point of time both are responding positively.
Q. There are two arguments against Radio Mirchi. One, you have leveraged your cross-media strengths too aggressively and two, with Mirchi going Hindi, you are actually catering to the lower end of the audience spectrum. How do you react to this?
I think you have to realize that we are in radio because we are in related media domains. So it is an extension for us. I am bound to use my in-house properties. That's a common sense.
Q. But do you agree with my statement that you are catering to lowest denominator now?
No, I don't agree. We are targeting Sec AB. But in some sense, every radio station is catering to the lowest common denominator. Why? It's a free to air medium! Second, radio has the characteristic of being non intrusive. So even in a college canteen if someone is playing a particular song, you end up listening to it.
But we are very clear about what target group we have. We have a clear persona of Radio Mirchi in our minds.
Q. Recently a lot of upheavals have happened in the category. A few stations have opted out and sought the intervention from the court. In Delhi, there have been incessant delays. How is all this affecting the over all category?
You are right. These are not healthy signs for the category. You must ask the defaulters, why are they now pleading with the Prasar Bharti? Are they doing their business plans now!
We have to first develop this category.
My learnings as CEO of BPL Mobile are coming handy. At the start we had an Rs 80,000 mobile phone and Rs. 16 per minute as airtime. Consumers would say "ye hamare bas ka nahi hai, 80,000 ka phone, 15- 16 rupey per minute phone, incoming ka bhi charge do"
But look at the growth rates now. Simply amazing!
So I am sharing my experience with the Radio Group on how to develop the category and today we are in forefront of developing category. I am constantly in touch with government to draw their support.
To give a quick background, as per the licensing of the Government of India there are two kind of classification; one is the metro and other non- metro. Rightly the Government of India directive said, in the metros all stations will get on to a common mast and that common mast, common tower will be built, operated, maintained by the consortium of radio participants. All operators are signatory to this.
But when we started implementing, it wasn't easy. Firstly, this consortium route was tried nowhere else in the world. Secondly, the resources, legal and technical issues were too cumbersome. Issues like, who own the common infrastructure, crept up. So, all players got through a lot of iterations.
Incidentally even internationally, there are hardly two or three vendors who can put his common infrastructure. It is not nuclear science but nobody does this kind of 'integration'!
See, the basic issue is not technology or infrastructure alone. It's about getting five or six people to sit together and agree on lot of things. Not easy!
In Mumbai Government gave us 'interim' permission to set our towers individually and go on air. We are expected to congregate after 24 months or 18 months onto a single tower. But what it has done for the category? Nothing short of miracle! All five stations are up and running and people are tuning into Radio.
Indore, Ahmedabad, Banglore were categorized as 'non- metros' and thus we went on air much earlier. We are now pleading with Government to allow such arrangement in Delhi, Calcutta and Chennai.
Basically we are on a learning curve. Actually, it's a new industry. So running a huge radio corporation with national foot front is challenging but can be a nightmare sometimes.
Q. IMRB listenership research suggests that you have a very high share of the market...
I think we will not enjoy such high numbers for long! The market forces will operate and impact the current shares.
In fact I have written a letter to all key decision makers in India, thanking them of encouraging us at Mirchi. But I want to put a word of caution.
Internationally, in a mature market over the year or two, leadership status would signify 35% market share. The same will be true more or less in Indian context.
See, my first priority is to grow the market share. I am in position to tell Peter Mukrejea that we need this category to develop.
We know that these are early days. But yes, our vision is clear. We must hold national listenership share of 35%. But in Mumbai, we expect that our listenership share to remain at more than 50%
Q. You had recently quoted that housewives is your key audience. What is the thinking here?
Yes, we are looking at this segment aggressively. Our research suggests that we have a huge Sec AB, housewives tuning at some time bands.
Q. In nutshell how do you see the future of radio and Radio Mirchi?
I think Radio has an awesome future. It is free to air, city centric. The expectations have come to fruition on much earlier than I thought.
When our leader, Vineet Jain wrote the mission station for ENIL, he wrote that Mirchi should be the No 1 commercial radio broadcaster in India. And should have the leadership in Outdoor and Events.
And with luck and support from the Time Group, in less than 18 months, are into event also -company is called 360 degrees. I am quite excited about things!
Q. How is Radio connected with event management and outdoor?
Radio and Outdoor, in USA and Europe have very close kinship. They are large revenue models developed overseas on these businesses.
The movie like Matrix was shot in a studio owned by a radio company.
Q. How is the team at Mirchi...
We have very competent people like Sunil Sahjwani, our national programming head, Farid Kureshi, our National Sales head and COO Prashant Pandey.
I keep saying that as a CEO my role is to collect awards and put out speeches! It is the team here that is doing all the work.
Q. To end, how is Mumbai treating you?
I am a pucca Mumbaite! I just love the city.
One of the important reasons why left Rajiv Chandrashekhar and BPL, was that my request to get a transfer to Mumbai was not met with even after 7 years. I am happy to be back in Mumbai.