After a two-year lull, the radio industry is finally hoping to see a stronger festive season this season. Businesses are still recovering fully from Covid and have not reached pre-pandemic levels of earnings, but experts say this year will be good for the industry as the sector already shows key signs of a strong recovery. I am optimistic as I get older.
According to Rahul Namjoshi, CEO of MY FM’s radio division, this year is much better than the first two years as almost every category has recorded growth. “Even the stock market is at an all-time high and we are benchmarking this holiday season to 2019 (the pre-Corona period) and I am confident we can beat that.” he says.
In the same opinion, Nisha Narayanan, Director and COO of RED FM and Magic FM, shares that the overall volume trend is northward. “For Red FM, the season has started well and volumes have picked up. she added.
The radio industry has come a long way since the pandemic. His 2022 festive season, which begins with Ganesh Chaturthi and runs through Dashara and Diwali, is expected to spur radio’s recovery.
Neeraj Saraswat, CRO of Fever FM, also claims to be optimistic about returning to pre-Covid levels this year. “With several innovative products being launched, the channel is focused on continued engagement with its audience,” he says.
According to the Pitch Madison Advertising Report 2022, radio spending increased 36% in 2021 (after a 44% contraction in 2020), but radio AdEx has not fully recovered. According to the report’s estimates, his AdEx of Rs 1,733 crore in 2021 will take radio back to his 2016, when he recorded spending of Rs 1,749 crore. In terms of share, Radio AdEx, which was 4% in 2015, 2016, 2017 and 2018, is now only 2%, similar to what it achieved in 2020.
Namjoshi shares that radio AdEx has been a big hit due to Covid, with special rates offered to brands as support during that period. But this fiscal year, we’re seeing near-normal business operations across categories.
Regarding pricing, Namjoshi said: As a market leader, we have initiated a rate adjustment process with our business partners and are on the right track for rate recovery,” he said.
Regarding moving averages, Narayanan added: However, there is room for improvement in the larger generation markets and categories, and we expect the gap to be minimal as we enter the fourth quarter. ”
After two years of pandemic slump and slow recovery, the market is definitely booming, and the radio business is no exception, according to Saraswat. He said August was the first month in the last two years that advertising inventory was squeezed in Delhi NCR. And they believe this trend will continue since Navratri’s inception.
According to the FICCI EY 2022 report, ad volumes in the sector have recovered by 29% compared to 2020, but are still 6% behind 2019 volumes. In fact, advertising prices dropped by an average of 13% during this period.
Some players in the space have raised prices, while others still offer discounts on advertising rates, according to media experts.
“Yes, as volumes have increased, all players have tended to raise their prices, and they have also raised their celebratory prices. One Preeti Nihalani said:
Advertisers, on the other hand, are still very cautious in their approach and tighten their purse strings. “This has created price competition among media players, impacting overall revenue and media in general,” said Narayanan. and properties also block, adding: “We believe that a good product can get its price despite the competition and challenges.”
Regarding volume, Saraswat said: However, from a price point of view, it is still not at pre-corona levels. However, with much higher demand during this holiday season, advertisers are expected to be willing to pay a premium for better service and a differentiated advertising environment. To meet the surge in demand, he plans to raise prices by 15-20% during the festive period. ”
According to the FICCI EY report, 71% of radio ad volume in 2021 was delivered by the top five ad sectors, including services, banking/finance/investment, food and beverage, and automotive and retail. In fact, these top five sectors remained the same as in 2020.
“We also know that certain categories are spending more aggressively than others: retail, food and beverage, automotive, durables, e-commerce, and food delivery apps, aggregator platforms, payment apps. Categories such as new-age businesses will benefit the most from this holiday season surge in demand, with the real estate sector growing by more than 50% compared to last year. Overcoming problems and slowly regaining buyer confidence, it continues to invest aggressively in launching new projects and bringing them to market.Radio is one of the most popular hyperlocal media in the real estate industry. We are looking forward to a profitable holiday season,” added Saraswat.
Narayanan said the major categories that have been very active on radio this year include dotcom, BFSI, government, automotive, industrial, FMCG, consumer durables and organizations. Retail, real estate, stores, education, medical services. “It’s really encouraging to see real estate, education and shops come back among the top categories this year, and radio to see better earnings and growth on the way.”
Speaking about the factors driving growth this season, Namjoshi shared that the festive season adds 25-30% of revenue in all major categories. “People are safe and looking forward to an exciting holiday season after a two-year hiatus due to Covid restrictions,” he said.
Nihalani shared that rising consumer spending is one of the biggest drivers of growth this holiday season. Consumers are back in full swing after his two years of low-key festivities, and brands are aggressively rolling out strategies to connect and respond to them.
Because radio is hyperlocal, it is always used to advertise retail education, real estate FMCG, and public services. Retail, lifestyle, events, real estate, and education have also bounced back from the pandemic, seeing increased transaction volumes and improved revenue each month. Also, during the festivities, all major advertisers and segments will utilize the media’s ability to serve as a multiplier of reach and frequency to mate with all other media. ”
With the lifting of restrictions, radio players have also launched terrestrial events, with non-FCT revenue contributing an average of 15% of total revenue, according to industry reports. The FICCI EY report forecasts that radio advertising will grow at his CAGR of around 8% over the next three years, while non-FCT revenue he could grow at more than 17%.
“Fever FM is also coming up with innovative terrestrial IP aimed at delivering a unique and unparalleled consumer experience through meticulous curation of entertainment content and handpicked F&B options. February is packed with exciting events and IP that help brands reach their target audiences, build public awareness of their brands and products, create interest-inducing experience zones, and It provides brands with a unique opportunity to generate conversion leads.”
Similarly, Nihalani says that at Mirchi, almost one-third of its revenue comes from providing digital content (audio/video), impact properties, and “solutions” by creating customized multimedia solutions for clients. shared that it is due to
“Now that fears of pandemic-related restraint are no longer a major concern, our ‘solutions’ business, particularly those that provided audiences and brands on the ground, have also begun to scale back to pre-pandemic levels. This year, for the first time in two years, the physical format will be revived and various on-ground events will be held. One of our most popular dandiya his events Rock ‘n’ Doll is back in high spirits,” he said.
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