With the government allowing 20 per cent FDI in the private FM radio space and the I&B Ministry’s announcement that in the second phase of private FM radio policy at least 330 more FM stations would be allowed to come up through a bidding process, the radio sector is set to boom.
An important issue facing FM players is whether there is a need for a more effective tool to measure the popularity of radio stations. With the plethora of radio stations likely to come up in the near future, monitoring will be a nightmare.
Said Abraham Thomas, COO, Red FM, “Advertising drives revenues for a radio station. Therefore, it is of prime importance for the client to establish a market share or listenership.”
The same sentiment is aired by Ambar Basu, VP-Finance, Music Broadcast (Radio City). He feels that there is a big need for a reliable audience research, though, as of now, “the Indian Listenership Track (ILT) fills this gap”.
ILT was started in February 2004 by MRUC, with AC Nielsen ORG-MARG as the research partner, covering Delhi and Mumbai.
Tapas Sen, Senior VP, Programming, Radio Mirchi, pointed out that since ILT covers only two metros, it poses a problem for stations spread across the rest of the country. “Any mass survey will have its drawbacks. We have always believed in coincidental research rather than day-after-recall (DAR),” he observed.
As this tool is just a year old, one will have to wait and see how it shapes up in years to come and whether it is able to provide more relevant data to measure radio station popularity.
So, are there any alternatives for measuring or rating radio stations? Suggested Sen, “The best method, which unfortunately is not mass scale as yet, is the ‘watch meter’, which essentially tracks the frequency playing in front of you. It is actually a very real indicator as it is not subject to claims or memories or brand recall and hence is authentic. There is also people meter.”
Internationally, people meters are being used for radio apart from television but it has not percolated to the Indian market yet. All three -- diary method, watch meter as well as people meter – are being used in different markets. As for the Indian market, Thomas of Red FM believes that the solution lay somewhere in between and with a possible combination of these methods. "There are obvious cost implications in these methods but with the opening up of radio, this should get addressed,” he said.
So, is it a case of brand recall versus effective programming? Said Thomas, “A large percentage of the sample when tested cannot correlate between station name, programme name and the radio jockey. So actual listenership may be very different from what the current data appear to suggest.”
Radio Mirchi’s Sen on the other hand strongly feels that it is a “potential error area” that can be eliminated by changing the mode of research.
Basu of Radio City, on the other hand, thinks that going by popular perception, “it’s the programmes that create an impression on consumer’s mind.” Does that mean that effective programming is more important in making a radio station a hit with people rather than good marketing? His response is that “content is king”. And all other functions merely support the programming to ensure that there is enough sampling and loyalty is build over time, he added.
Sen does not quite agree with this view. “One function cannot exist without another. If you want to increase market share, you have to communicate to your audience that there is something exciting happening on your station. A good marketing campaign can induce people to sample your station, and based on the programming quality, they will decide whether to stay or to move on,” he remarked.
The upshot then is that communicating to the target audience is of prime importance and that can be done through good marketing campaign. Of course, programming has to deliver too.
Thomas feels that a sustainable strategic position requires trade-offs. Said he, “While trade-offs create the need for choice, they also constrain and limit what a brand offers. Therefore, to differentiate, you have to vacate some of the space you occupy.”
Abraham further said, “However, due to restrictions in the licence-fee regime, no brand was willing to vacate any slot to focus and differentiate. So, content was undifferentiated and the only differentiation attempted was through the packaging, jock talk and communication.”
But now, with the unshackling of radio, there will be scope for strategic differentiation in programming and marketing. “Aggressive programming supported by aggressive marketing in that order is the key to creating a hit radio station,” concluded Thomas.
So, here is to happy listening in the days to come!