2017 in Review: Mixed year for radio; digital, polls keep market positive: Abraham Thomas

Abraham Thomas, CEO, Radio City, remains bullish on the radio industry. Not only did the year saw the launch of 91 new FM radio stations, digital also kept the sector buoyant. This apart, the challenges during the year also taught the radio industry to become smarter and run tighter operations. 

The year 2017 saw the launch of over 91 channels across 54 cities. Radio City launched 11 frequencies across strategic markets to become a 39-station network in the Phase 3 auctions. We successfully defended our leadership in 22 of our existing markets from new competition. The new launches also saw the introduction of innovative formats that disrupted the new markets. 

Digital media continued its staggering growth in 2017 by reaching out to critical masses. Radio City leveraged this opportunity to expand our digital presence to 47 web radio stations on Radiocity.in. Radio City was the first to launch an exclusive Hindi website – radiocity.in /Hindi. 

Radio is projected to be the fastest growing traditional media compared to TV, OOH and print, second only to digital advertising. A recent KPMG report suggested that advertising revenues on radio are expected to grow at 16 per cent CAGR to more than double from Rs 2,270 crore in 2016 to a projected Rs 4,780 crore in 2021. 

The introduction of GST, India’s biggest tax reform, is expected to significantly improve the ease of doing business, with the reduction in the layers of taxation. While there are initial problems in execution, the long term macroeconomic impact is also expected to improve revenue efficiency and tax compliance. 

Implementation of the Real Estate Regulatory Act, 2016 (RERA) has enhanced transparency and aims to reduce volatility in the real estate sector and the positive effects for the industry are expected to be seen soon. 

While the immediate after-effects of the above changes did result in subdued growth for a brief period, we are expecting a revival in the industry and consumer confidence on the back of policy stabilisation. With brands expected to run aggressive marketing campaigns to achieve their year-end targets and with the onset of the election season, we are optimistic about a positive impact in the remaining part of the year. 

2017 – Annus horribilis or Annus mirabilis? 

2017 has been a mixed year for the industry. While the market has been subdued, categories such as automobiles, BFSI, FMCG and telecom have seen growth. At the same time, we witnessed a dip in advertising revenues from the real estate sector and government. Radio City has demonstrated growth and maintained profitability in the business. Our expansion into Phase 3 markets has helped in driving growth. The period has also taught us to become smarter and run tighter operations.

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