India Radio Forum: Looking beyond ad spots

At the India Radio Forum 2008, held in Mumbai on May 30, a key topic of discussion was how to make radio more profitable by looking at advertising and, more importantly, non-advertising revenue. Vanita Kohli-Khandekar, an independent media consultant and writer, who was also the moderator for the session, said radio stations haven’t even looked at non-traditional sources of revenue yet. The panellists agreed with her and offered their own perspectives.

Dnyanada Chaudhari, head, media services, Hindustan Unilever Ltd, offered the client’s perspective. She said 360 degrees had become the buzzword for advertisers. On-ground activation is another favourite. “For us, effectiveness of our advertising money is crucial and, therefore, what you bring to our table as well,” she said, addressing the radio station representatives. Value, she said, is what drives the monies. Chaudhari cited the example of kids’ channels, which have been attracting a number of FMCG advertisers purely because the brands are getting value out of it.

Kohli-Khandekar put panellist Ashit Kukian, executive vice-president and national head, sales, Radio City 91.1 FM, and a media owner on the advertiser’s seat and asked him for his views. Kukian clarified that they weren’t talking rates any more and it was no longer about plain vanilla advertising. The first question an advertiser asks is, ‘Do you understand my brand?’, said Kukian.

“Once we can give an answer to that, we customise solutions by integrating the brands into the content of the radio station, rather than just conventional ad spots,” he explained. This way, Kukian said, the engagement is far greater and returns on investment much better. He said advertisers were looking at interacting with consumers, and since radio is an interactive medium, huge opportunities exist. To facilitate this, Kukian said, Radio City has tied up with BTL (below-the-line) companies.

Punitha Arumugam, group chief executive officer, Madison Media, provided an honest media buyer/ planner perspective. She was of the opinion that money matters and, hence, so does traditional advertising. But she was quick to add that cost-effectiveness is what will make the difference. “As television and print become competitive and radio fights for its place, what will ultimately matter is how cost-effective the medium is,” she said.

Arumugam raised another important point – that of inventory utilisation. Non-primetime utilisation today is only 40 per cent of the on-air time for large stations. This, she says, is under-utilisation. “Radio stations need to develop the non-primetime bands and monetise them,” she said.

Radio Stations in Smaller Towns was another topic that sprung up in the discussion. Arumugam observed that real growth for radio stations is not coming from existing markets, but from smaller towns, because the existing markets are crowded. To this, Kohli-Khandekar raised the question of how tuned in small town radio stations were in terms of tapping the local advertisers. Kukian said local advertisers are important for Radio City; he cited instances of local gyms and beauty parlours expressing their desire to advertise. But he agreed that not much was being done in this regard.

Chaudhari of HUL observed that this segment held a lot of potential and that a number of small retailers were putting their money into print. Arumugam added that radio could be the primary medium for advertisers and provide them incremental reach in places like Bihar, where television is not very effective.

Kohli-Khandekar concluded that it was just a matter of reaching out to these potential advertisers and that radio stations needed to put in money and resources to identify them.