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RAM rollout hits a roadblock; industry expectations hit

RAM rollout hits a roadblock; industry expectations hit

Author | Pallavi Goorha Kashyup | Tuesday, Sep 14,2010 7:53 AM

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RAM rollout hits a roadblock; industry expectations hit

When RAM (Radio Audience Measurement) was introduced in the market, expectations were quite high from both radio players and advertisers. With coverage of the four key metros of Mumbai, Delhi, Bangalore and Kolkata, the RAM figures had greatly aided the radio industry. The weekly track of listenership helps advertisers, media planners and radio players understand the listenership pattern and the popularity of the medium among various demographics.

The proposed expansion of RAM to the Southern region with Chennai and Hyderabad, was seen as giving a more comprehensive picture of radio audience measurement. The Indian radio industry is currently 5 per cent of the overall advertising pie and the increase in RAM markets would possibly mean the advertising pie reaching the double digit mark.

However, the expansion to Chennai and Hyderabad has been delayed, owing to the slowdown last year. This has somewhat dimmed the radio industry’s enthusiasm. Expectations had been high in the industry with the FM Phase III rollout around the corner.

The Scope

Speaking to exchange4media, Pradeep Hejmadi, Senior Vice President - Marketing and Strategy Group, TAM Media Research Pvt Ltd, said, “RAM had proposed the coverage of two more cities – Chennai and Hyderabad – last year to all stakeholders. However, given the economic downturn that India was facing last year, this was not something that appeared feasible.”

When asked about the date for the expansion, Hejmadi replied, “We are in constant discussions to explore ways and means to expanding coverage of RAM. However, at the moment, we cannot state a fixed time-frame. In our discussions, we do not restrict coverage to cities – we are exploring sustainable and essential coverage. We haven’t got down to listing out cities at this moment.”

He further said, “Phase III licensing certainly adds attractive avenues for advertisers to consider the medium for greater geographical coverage and, therefore, increases the potential for the medium to bring in more advertising expenditure from our perspective. We are not particularly concerned on any aspect – if a need for more frugal audience measurement exists and the same is economically viable for all stakeholders, we are certain RAM will also expand its footprint. It is certainly too early for anyone to say anything in a more definitive manner, given the stage at which the licensing of FM radio stands at this juncture.”

The Benefits

Speaking about the advantages of RAM, Hejmadi said, “RAM, by virtue of being a continuous survey offers several benefits, such as: 1) For Agencies/ Advertisers – Besides being able to plan using trend data, it enables a post campaign analysis as well; 2) For Broadcasters – The service enables users to plan their shows, its promotions, etc., and then evaluate returns. Offering users the opportunity to keep learning, unlearning and re-learning consumer expectations.”

Shortcomings & Challenges

He further said, “One of the shortcomings is the scope of RAM; since it covers four metros, we have been getting requests from planners/ buyers/ advertisers to increase coverage as a large number of stations offer multiple market packages, which they are unable to assess.”

“The challenge is in a manner linked to the current shortcoming: expansion of the service, given the fact that at least four stations need to step forward in every market to keep the costs at a manageable level for each station, and given the fact that some of these markets are low revenue yielding markets for stations. Economically, it has been sort of a standstill,” Hejmadi explained.

‘RAM currently is like using a spoon to measure the ocean called radio’

When contacted, Prashant Pandey, CEO, Radio Mirchi, told exchange4media, “I haven’t heard of anything specific really. In the past, they have spoken of extending the research, but we haven’t heard anything in the last three months.”

According to Harrish M Bhatia, CEO, 94.3 My FM, “At present, RAM is the only standard tool for gauging listenership for the radio industry at large. However, the recent working of this methodology has shown some concerns within the industry.”

He further elaborated, “In the last few months, RAM data has been very inconsistent, and the radio industry across the board isn’t very optimistic about the way the data is being measured. There have been sudden movements of lakhs of listeners between weeks, which quantitatively cannot happen on radio, to my knowledge of media. The radio industry is questioning the basis of lakhs of listeners shifting to other stations every week. Fundamentally, these kinds of discrepancies are raising a question mark in the minds of radio operators.”

“In light of this inconsistency, we feel that the measurement needs to be corrected at the fundamental level before entering the Tier II section of the industry. A more stable and reliable measurement system needs to be shaped up in the long run for strengthening the potential of the medium and some investments need to be made,” Bhatia added.

Vineet Singh Hukmani, CEO, Radio One, noted, “RAM is still inefficient in four cities because of low sample sizes, which make its data statistically insignificant even in these markets. Most media planners prefer to look at IRS for all India data. This is primarily as RAM has not invested in larger samples and electronic data measurement. Given that Phase III FM expansion is around the corner, the only hope is IRS making their data monthly as it covers India geographically. RAM currently is like using a spoon to measure the ocean called radio.”

Nisha Narayanan, Senior Vice President - Programming & Projects, Red FM, remarked, “Most markets in regional India do not have a radio measurement system. Often, individual studies are done, which may or may not be biased. In many cases, it is tailormade to suit the broadcasters’ demands in that market. A syndicated study, which is unbiased, can only make the markets more competitive. Currently, media planners rely a lot on these individual surveys, but with RAM coming into these markets, the bias should turn into authentic data. Having said that, I would also like to mention that most of these markets are not ready for weekly data. In my view, a once a month data, which will give the trends and the ratings, should be sufficient.”

She further said, “Audience measurement systems coming into small town India is only an indication of the fact that the radio markets are maturing and becoming more competitive. As I have mentioned many times before, the growth of radio lies in small town India, and this is just another step towards it.”

On the one hand, the expansion of RAM to other cities is eagerly awaited by the radio industry, but on the other hand, TAM Media Research is unable to give a time-frame for this expansion. While radio players more than welcome RAM in small towns, it may not be an economically viable proposition. Plus questions like how often, what sample size et al, are yet unanswered.

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