RADIO INDUSTRY INDIA

Done by : C.B.Jayapavithra Sukanya Kumar Bhargavi .M Smruthi . V A.Gayathri Divya.M Vishnu priya Namrata Torka

INTRODUCTION

There are a total of 232 FM channels, private and government owned in India. Current size of the radio industry (2008) is estimated at US $170.87 million. According to a PwC study, the radio industry is forecast to grow at a compound annual growth rate(CAGR)of18percentover2009 13,reachingUS$391.15million. In terms of its share of the advertising pie,it is projected that the radio advertising industry will be able to increase its share from 3.8 percent to 5.2percent between 2009 and 2013. The government earned US$11.05 million from private radio channels during 2008-09. Radio Mirchi, along with its alliances, is number one in the Indian private FM radio industry, with a 46.5-million listenership according to Indian Readership Survey(IRS)2009.

GROWTH OVER THE YEARS

NUMBER OF STATIONS

RADIO MIRCHI

Radio Mirchi is the most popular private FM radio channel in India with the largest operating network and a presence in 33 cities & 6 Metros.

In October 2001, RM launched radio broadcasting station in Indore.

Operated by Entertainment Network India Ltd (ENIL).

Promoters: Bennett, Coleman & Co. and Time Infotainment Media Ltd.(cross media ownership)
Radio Mirchi bid on 64 F & won 12 licenses.

Radio Mirchi started first from Indore.

II-WAVE OF FM PRIVATISATION

In mid-November 2005, Radio Mirchi had announced that it was entering the capital market to raise capital of Rs. 2 -3 billion. In February 2006, Radio Mirchi, the most popular private FM radio channel in India, announced that its license bids for 32 cities, spread across the country, were successful.

Its highest bid of Rs. 281.6 million was for the city of Bangalore.
The bidding process, which began in January 2006, was part of the second phase in the Government of India's (GoI) efforts to privatize FM radio. Radio Mirchi was already present in seven cities, including key cities such as Mumbai, Delhi, Kolkata, and Chennai.

OWNERSHIP

ORGANISATIONAL STRUCTURE

DEPARTMENTS

Administrative department
This department maintains, organises and runs the entire radio station.

Finance
Manages the accounts, finance and prepares
budget and annual report.

Technical
Manages the equipments necessary for broadcast

Programming
Decides the program content, order of content etc.

Marketing & PR
includes sales promotion, advertising, publicity and public relations.

a) Advertising:
For advertisement purpose they use different kind of medias, Such as print ,outdoors, and electronic.

b) Sales promotion:
Sales promotion, key ingredients in marketing campaign .They promote their program or any event by organising contests respective to that event.

c) Public relation:
Public relation involves , variety of programmes to promote the company image. Example-sponsoring events and contests, tie ups etc.

d) Publicity:
in terms of corporate social initiative and other campaigns.

Transmission engineers
They are responsible for the transmission and relay of programs.

RJs Music management

The process of production starts by the research for song. mixing of the songs, important updates, announcement, jingle, advertisement etc.. Mixed according to the programs etc.

COST ASPECT

A Licensee pays Rs. 6000/- per hour.

Add Rs. 1,500/- for the music. Add Rs. 8,000/- for the technology, salaries and other expenses. An hour long show thus costs Rs. 15,500-20000. 20-25 Minutes have been set aside for advertising. One minute is reserved out of 10 minutes for social awareness advertising. Thus, advertising time available for sale is 20-25 minutes. In other words, 20 advertisements each of 15-30 seconds can be accommodated in an hour. Besides the tariff card should be modest, considering the limited range and listenership supposing a 30 seconder costs Rs. 1000-Rs 3000 at prime time for 20 such spots, the total revenue generated is Rs. 20000-60000.

ROYALTIES

FM is primarily a music channel, so the question of royalties is relevant The Indian Protographic Record Society (IPRS) and Phonographic Performance (P) Ltd.(PPL) are supposed to hold all the rights of royalties. They are demanding Rs. 1,500 per hour (as against Rs. 100 per hour, at which they are supplying music to AIR), PPL is demanding a royalty of Rs. 250 per hour of needle time, the actual duration of a piece of music. The IPRS is demanding Rs. 100 per hour. The IPRS claims royalty for the original composers and authors of music.

HOW THE PRICE IS SET

Flexible price: Flexible price is used to reduce the perishability characteristics of services and iron out the fluctuations in demand. When the demand is less the charge is less and when demand is high the charge is more. >> Ex- day time slot price and prime time slot price are different

Discount price: Discount pricing refers to the practice of offering a commission or Discount to intermediates such as advertising agencies, stock brokers, property dealers for rendering a service. It may also be used as a promotional device to Encourage use of low demand time. Ex- if a company books a slot say 2 or 3 months in advance, discount is possible and also if the radio station is a client of that company.

Diversionary price Diversionary pricing refers to low price which is quoted for a basic service to attract customers. For ex-if a prime time slot is booked , discounts will be available optionally if the company also wants to advertise in low demand slots.

High price maintenance prices: High price maintenance pricing strategy is used when the high prices is associated with the quality of the service.

Ex- as of now radio mirchi ranks 1, and hence its prices are higher when compared to others.

Combo price Combo price means booking advertisement in one medium(radio or tv or print) and have options to book advertisement in other branches of that medium. Ex- suryan fm-sun tv-newspaper

REVENUE

Panel Unit confirms Radio Mirchi as the leading FM Radio station ahead of Red FM and Radio City. With 12.1 daily listeners, Radio Mirchi leads with a 72 per cent share of the market. Entertainment Network (India) Ltd., Indias number 1 Private FM Radio operator, popularly known as Radio Mirchi.

Revenue growth has been buoyant; lifted by the ICC ODI cricket world cup.
They are on the cusp of a major expansion in the radio business with the announcement of the Phase III of Private FM radio policy expected soon. As per Indian Readership Survey (IRS) Q4 2010, Radio Mirchi has maintained its leadership position in India. Radio Mirchi has garnered the top spot in FM radio with a listenership of more than 41 million listeners nearly double the listenership of the next radio brand. Mirchi has consistently been the leader by far across all the survey results of 2010. Mirchis current listenership is bigger than the Average Issue Readership (AIR) readership of the Top 3 newspapers put together.

USP OF RADIO MIRCHI

Playing contemporary hits songs Radio Mirchi has always been the no 1 choice of listeners
As Mirchi has more than 41 million listeners across 32 stations Its market share in revenue terms remains in excess of 40% of the private FM industry. Radio Mirchi is the number 1 radio brand in the private FM space. It won a Plethora of awards. It has been recognition of the brand popularity and the creative talent behind the brand.

Mirchi was voted the no. 1 media brand, ahead of iconic brands like the times of India and star plus.
As per brand reporter October 2009 issue Mirchi was recognized as one of the game changers of the decade in the radio industry.

A COMPARATIVE STUDY OF SOME RADIO STATIONS

ALL

INDIA RADIO CITY

RADIO RADIO

MIRCHI FM

RED/SURYAN

ALL INDIA RADIO

A.I.R, which is a national service planned, developed and operated by the Ministry of Information & Broadcasting under the Government of India. New initiatives by AIR

Radio Advertising AIR, which produces more than 300 bulletins daily, will also cash in on phone bulletins. The service, which is on in Patna, Hyderabad, Kolkata and Delhi at different numbers, will be launched across the country with a four -digit common number.

Prasar Bharati is set to launch a major campaign aimed at repositioning and total branding of the two FM Channels of All India Radio (AIR). Prasar Bharati is positioning AIR FM Rainbow as a channel offering a buffet fare - Hindi Music, Western Music, Chat shows, Helplines etc. and for this it is launching a campaign in select cities

The publicity campaign of AIR is focused on projecting AIR as the world's oldest and largest radio network both in terms of geographical and population reach and the only source for news and entertainment for people in remote places. It will promote and publicize sports events covered by AIR besides popularizing existing services like Radio on Demand and News on Phone.

The entire publicity campaign of AIR is being designed by Prasar Bharati's ad agencies. The ad agencies have been asked by the Prasar Bharati to make a strategy presentation, recommending a suitable positioning for AIR Channels, a marketing plan and publicity plan with suitable media mix.

RADIO CITY

Radio City, a venture promoted by Star and Music Broadcast Private Ltd (MBPL), was launched on 21st May 2002.
MBPL is a company backed by P.K.Mittal, family and Associates. The company has received the license to set up radio stations across the country in six cities - Bangalore, Delhi, Mumbai, Patna, Nagpur and Lucknow. The Mumbai license was secured for Rs 10 crores. STAR Indias radio division would provide or take charge of advertisement sales, marketing and programming Radio City aims to reach out to listeners across demographic barriers.

TARGET AUDIENCE

Radio City is not looking at any particular segment to target, and is trying to create a brand name. The idea is to create the brand and then to move on to specific target programming. Radio Citys market strategy is backed up by six months of intensive research in Bangalore. Intensive research is being carried out to ascertain demographic profiles of radio listeners, so as to enable more targeted programming in the future.

THE 4 PS

Product: For listeners - Music, information, a portfolio of entertainment programming 24 hours a day, in mix of Hindi and English .For corporate and retailers: - The airtime.

Place: Intensive all over Bombay also, Selective in the sense that it has set up radio stations across the country in six cities - Bangalore, Delhi, Mumbai, Patna, Nagpur and Lucknow.

Price: Advertisement rates

Promotion: Radio city is one of the top 3 stations in the city. This is thanks to its promotions, a perfect blend of English and regional music, teamed up with professional, vivacious RJs. On the promotion front, the channel undertook huge promotion campaign in the initial stages of its launch. The Television fun ka doze har roz ad campaign. Hoardings all over the city.

The channel is into sponsoring events especially college festival

Advertising with Radio City

Radio City has managed to attract advertisements, from small local stores as well as big brands like Tanishq, IBM and HLL.

Star India is in-charge of providing the content, besides advertising, sales and marketing support.
Radio City will have a four-hour slot in its 24-hour broadcast for advertisement, breaking to a 10-minute projection in every hour's programmed. Radio city is trying to drive the market by encouraging the ad spends on radio to increase from two per cent to the world average of 10 per cent.

RADIO MIRCHI

Target audience
As the punch line says, 'it is hot.' They have a very clearly defined position they are a contemporary hit radio station, and their Target is around 18 to 35 - SEC A and B and in that too mainly youth and housewives. This segment addresses about 12 lakh listeners 65.

THE 4 PS

Product:
For listeners: 90% of the music played on RM is regional and other language contemporary hits are played keeping in mind the tastes of their Target Group airtime

Place:
intensive in Mumbai and selective all over the country since it is established in cities like Kolkatta, Delhi, and Chennai.

Price:
The advertisement rates

Promotion:
The marketing strategy of Radio Mirchi revolves around two crucial pegs create hype around the name Radio Mirchi, plug Radio Mirchi through the other media that The Times Group owns. It also does a lot of tie -ups and contests for the consumers

Rad io mirch i h as also tied u p with variou s sh op p in g malls, retail sh owrooms, for con tin u ou s ad vertisem en t of th eir ch an n el to make p eop le aware of th e temp tation s given b y th e ch an n els to th em. Ad vertise m en t s Disp lay med ia Tie u p with comp an ies Feed b ack from listen ers (b u ild con su mer in volvemen t)

MARKETING STRATEGIES

Sponsored many things.

Lau n ch in g in n ovative p romotion camp aign s. Mad e sales team to main tain relation with local ad vertiser s Price of Ad s b ased on time. Ad d ition al in come from SMS Rad io mirch i h as two main ob jectives b eh in d d oin g an exten siv e marketin g wh ich are To create th e Top of th e Min d recall in th e relevan t Target Au d ien ce An d Con n ect with th e growin g Rad io listen in g p op u lation in Mu mb ai. A very large factor th at con trib u ted toward s th e estab lish in g th e b ran d of RADIO MIRCHI was its catch y slogan its h ot. However th e slogan b y itself was in comp lete with ou t th e voices th at accomp an ied it. CE LE BRITIE S an d film stars th at rep eated every so often h i Im -------- Im h ot an d Im Rad io Mirch i!! b ig n ames th at gen erated cu riosity an d excitem en t an d comp elled th e listen er to refrain from flip p in g th e d ial.

Advertising

Radio Mirchi charges the highest rate of Rs 2,000 for a 10 -second slot, the rest of the FM channels charge anything between Rs 1,000 and Rs 1,500 for a 10 -second slot. Radio Mirchi listenership extends to 45 lakhs every week as per Radar study. There is an average listenership of 45 minutes per day on the station. The rates are reasonable that advertisers can afford 10 or 15 spots a day and run the campaign for 15 days or three weeks at a fraction of the cost that you will incur in print or Television. There are about more than 300 advertisers on Mirchi. Radio Mirchi sells independently and does not offer any print package deal even though they belong to Times Group they are an independent company. Most of the national advertisers on Radio Mirchi today want to buy all the stations on air(all the cities). So they have package deals for them . There is very little retail advertising on radio. Currently, on an average, there are 125 to 175 brands advertising on Radio Mirchi. In most cases, stations offer discounts on what is on their rate cards. On an average, across the five stations, the effective ad rate going for a ten second spot would be anywhere between Rs 1000 to Rs 2000. Clients buy effective rates and they buy a combination of spots like prime time, non prime time and the likes. IMRB conducts research for Radio Mirchi which is after every 15 days to know exactly what the listeners actually want to lend their ears to. Hence, accordingly, they have implemented the changes in the time slots of the different shows on air. So when the advertisers wants to advertise on radio, Radio Mirchi can provide them with the more information and help them to decide on the time slots and frequency etc

According to the study conducted:Mirchi delivers highest number in terms of listenership among Housewives and working men. Radio Mirchi delivers highest number in terms of listenership among the Radio Listening student population. Radio Mirchi emerges up as the No. 1 channel and delivers high numbers with Daily listenership at 24.63 lacs. Future Plans:Radio Mirchi is looking radio Industry from the long term point of view. They are interested in some of the bigger cities and Mirchi would eventually look at having a presence in every nook and corner of this country, which means going into the smaller towns.

RED/SURYAN FM

It is owned by Sun TV network, Indias largest network has power packed 32 TV channels and 45 fm radio stations. It was acquired from India Today promoter Living Media in January 2006. Their punch line is 'Bajaate Raho' (Keep Playing). Starting August 14, 2009, S FM or Suryan FM was re-branded into RED FM across 38 cities in INDIA. S FM took over Red FM in August, 2009 and re-branded all its stations to Red FM except for the ones in Tamil Nadu.

Target Audience
93.5 Red FM caters to 25-plus age group and also youth, housewives.

The 4 Ps Product: For listeners: The programming mix has non-stop music interspersed with Red FMscrisp and entertaining updates on traffic, weather, city-specific events and the latest buzz on everything current. For corporate and retailers: the airtime

Place:
Intensive in Mumbai and Chennai and selective all over the country

Price:

advertisement rates

Promotion: Red Fm is associated with many production houses(films)

Marketing initiatives
Promotions through various electronic mediums. Tie ups, launch campaigns and sponsors Two key elements-contemporary music around the clock, the other being emotional element Advertisement the clients are more enthusiastic because the FM station is present across the country, and also the fact that the FM station is able to deliver a certain quality and content that a listener or even an advertiser expects. While Red FM is said to be very strong among retail advertisers in terms of revenue generation, the Red FM ad revenues are evenly split between both national and retail advertising. Going forward, Red FM aims to be as interactive and as local as possible

RATE CARD

30 secs spot buy rates

30 secs spot buy rates RADIO MIRCHI

Programme category 07:00 - 11:00 17:00 - 20:00 Radio active

Mumbai 8000

Delhi 8000

Banglore 5000

Lucknow 4000

11:00 - 17:00 20:00 - 22:00

Radio Mix

6000

6000

4500

3000

22:00 - 00:00 Round the clock

Radio Master Blaster Radio Ga Ga

6000 4000

6000 4000

4000 2500

3000 2000

TERMS AND CONDITIONS:

Minimum acceptable radio spot/ commercial duration will be 10 seconds. In case any programme, which is being offered in this package, gets discontinued, the advertiser will move the spots to the programme replacing the discontinued programme in the same rate category.

To ensure proper and timely release of the spots, release orders should be given to MBPL through Star India Pvt. Ltd. At least 2 weeks prior to the date of airing of the first spot.
All bookings are subject to availability at the time of booking. The agency/advertiser must provide DATS at least fifteen days prior to first spot airing date. The sponsorship material must be sent four weeks prior to start date of the sponsorship of any programme. All invoices should be settled by the advertisers/agency within 30 days from the date of the receipt of invoice

SURYAN FM

The marketing department is wholly responsible for the advertisement sales of the in-house productions of the Sun TV Network Limited channels.
With it's team of dedicated professionals, it is today one of the highly appreciated professional marketing unit among satellite televisions. Apart from offering the available advertisement time in the most effective way, it offers the best follow up service. The deals, that are made, are mutually beneficial and uniform. It functions with the motto - professionalism, efficiency and dedicated service.

Starting Time

Ending Time

RODP rates

Rate

07:00am

11:00am

600

Denotes 10 sec Rate

11:00am 17:00pm 350

Denotes 10 sec
Rate

17:00pm

22:00pm
600

Denotes 10 sec Rate

22:00pm 07:00am 350

Denotes 10 sec
Rate

PUNE RED FM

Starting Time 07:00 am

Ending Time

RODP rates

Rate

11:00 am

750

Denotes 10 sec Rate

11:00 am

05:00 pm
10:00 pm

450
750

Denotes 10 sec Rate Denotes 10 sec Rate

05:00 pm

10:00 pm

07:00 am

450

Denotes 10

sec Rate

RADIO MIRCHI

Prime time -8-10am, 6-8 pm15-20 % hike in slot.

Minimum jingle length

The minimum jingle duration will be considered as 10 sec.

Over 10 seconds, jingle length would be counted in multiples of 5 seconds.

E.g. A 23 second jingle would be billed as 25 seconds

( R AT E P E R 5 S E C S )
Region City Delhi North Rate 1500 Split
7am to 12noon 12noon to 5pm 5pm to 11 pm Prime time -8-10am, 6-8

Jallandhar Japiur Kanpur Lucknow Varanasi

150 200 200 200 130

pm15-20 % hike in slot.

Region City

Central Rate

Bhopal
Indore Jabalpur

175
200 150

Raipur
Gwalior

150
200

Region City Kolkata Guwhati Patna

East Rate 500 150 400

Region

West

Pune Kolahpur Nasik Aurangabad

650 150 200 150

Nagpur
Panaji Ahmedabad Surat Vadodra Rajkot

200
150 550 150 150 150

Region City Bangalore Mangalore Hyderabad Vijyawada

South Rate 700 150 550 150

Vishakhapatnam
Chennai Coimbatore

150
600 200

RADIO ONE

CHENNAI LIVE
FIXED TIME BAND 06:00-08:00 08:00-11:00 11:00- 14:00 14:00-17:00 17:00-21:00 21:00-24:00

Rs. 10/secs 2,500 3,500 2,500 2,500 3,500 2,500

Total Audience Plan (TAP) Monday-Sunday 06:00 - 24:00: Rs. 2,500/-

Best Time Available (BTA)

Monday-Sunday 00:00 - 24:00: Rs. 1,500/-

FIXED TIME BAND

Rs. 10/secs

06:00-08:00 08:00-11:00 11:00- 14:00 14:00-17:00 17:00-21:00 21:00-24:00 CHENNAI LIVE RATE CARD Total Audience Plan (TAP) Monday-Sunday 06:00 - 24:00: Rs. 2,500/Best Time Available (BTA) Monday-Sunday 00:00 - 24:00: Rs. 1,500/-

2,500 3,500 2,500 2,500 3,500 2,500