The power of radio

Given the size and diversity of the country, radio as a medium is still grossly underutilised

It was in 1923 that Radio Club of Bombay first began broadcasting over the air waves. A generation of Indians still fondly recollects listening to Ameen Sayani’s voice on Binaca Geet Mala, first broadcast through Radio Ceylon back in 1952. Before television sets became ubiquitous, radio was a part and parcel of every Indian’s life.

The real boom in the Indian radio industry, however, began only in 1999 when the government decided to let private players enter the FM radiobroadcasting space. Over the 18 years since, faint murmurs of a brewing radio upsurge are often heard during media planning sessions across the country. Can marketers now start seeing radio as more than a second fiddle to television? Is it time for the medium to finally get its due?

The numbers seem to be in favour. As per a KPMG report, advertising revenues on radio have grown 14.6 per cent year-on-year in 2016. The growth is expected to continue at a 16.1 per cent CAGR to more than double from ~22.7 billion in

2016 to a projected ~47.8 billion in 2021. Radio is expected to grow faster than all traditional mediums like TV, OOH and Print- second only to digital advertising. This comes at a time when the average growth in US, Japan and the UK, has been less than 2 per cent over the past four years. Even for growing markets like China and Brazil the growth has been below 3 per cent.

While radio has hit a plateau across the world, the Indian picture is starkly different. Over 70 new stations have been launched last financial year with another 90 new stations expected this financial year. While the action surely is heating up, given the size and diversity of the country, radio as a medium is still grossly underutilised in our country. To put things in perspective, in the largest radio market—US the advertising revenues brought in last year have been a staggering $22 billion!

So what is it that’s driving this growth? Marketers are now waking up to the power of the radio. Audio is a very non-obtrusive format. At the same time, it’s one that commands attention and establishes recall. Whether it’s the pull of the human voice, or the magic of foley —in its essence, listening is more akin to reading a book than watching TV—it invokes imagination. As the American author Peggy Noonan once rightly said, “TV gives everyone an image, but radio gives birth to a million images in a million brains.” Advertisers are also realising that radio doesn’t necessarily compete with print, digital or TV but rather complements them.

We’ve observed that peak radio consumption occurs during commute hours which then leads into the peak consumption times on television. A well rounded marketing campaign can leverage this trend to engage consumers at all times. Unlike the threat from digital for other mediums, for radio, digital has been a catalyst providing newer opportunities to create engagements and cross leverage digital platforms. The omnipresence of mobile phones, with even the cheaper ones having a built in FM player has today put a radio in more pockets than ever.

The rise in consumption is also being driven by the urge of marketers to target burgeoning smaller towns. Radio stations today have localised offerings, reaching out to their audience in a language they understand, with a flavour that suits their palette. In spite of the localised reach and affordable pricing, radio’s share in the overall advertising revenue in India still ranges around 4 to 5 per cent, much lower than developed countries where it’s between 7 to 10 per cent.