Just three months after it launched, Gauteng’s first black radio talk station was among the country’s most influential media, according to independent research.
Talk station Power FM launched in June, heralded by much social media hype. With a solid line-up of talent (some of it poached from the competition, Talk Radio 702), and despite some glitches and gaffes, Power made a much more impressive debut than did certain other broadcast media this year.
In late August, Media Tenor found Power FM was among the most quoted business media, more quoted even than Business Day. While it was too early for the station to have any listenership figures, Power chairman Given Mkhari says there has been strong uptake by listeners, judging by the station’s interaction with its audience on social media, the number of unique browsers to their website and the volume of calls they handle.
Power FM’s initial success may still be momentum from the hype of their debut. But will they have a lasting impact on the radio advertising landscape? Mkhari’s consortium, MSG Afrika Investments, successfully launched Capricorn FM in Limpopo in 2007. Within its first year, It had 1.5 million listeners and it remains strong. But Gauteng is not Limpopo. Capricorn was the largely rural province’s first commercial station, whereas Power FM is up against Talk Radio 702 and another ‘black’ station, Kaya FM, in a metropolitan market. Advertising spend in radio is currently almost R1.5 billion, according to a report in the Mail & Guardian, about R500 million of which is spent with Radio 702.
Richard Lord, associate media director of The Mediashop, says he does not think the landscape will change much with the advent of Power FM. “Power FM will provide a station for a different audience and will provide a new opportunity for advertisers.
“But the radio advertising landscape is quite static, with stations that have been around a long time and have entrenched relationships with advertisers. They won’t grow the pie. If advertisers want to spend with them, they will have to take budget away from other stations. And people aren’t going to stop advertising on Highveld or 702.”
Lord says, however, that Power FM could lure away some listeners from the competition, as long as they are doing something fresh. “I think Kaya is the station that is most similar to Power in terms of who their listeners are. It’s their listeners that Power is after. But we mustn’t forget that 702, though it is positioned as a high-end station, actually has quite a significant proportion of emerging market listeners. While their core is LSMs eight, nine and 10, there are a number of LSM six and seven 702 listeners. If Power can provide a more relevant offering, they might attract these listeners,” says Lord.
In Power’s favour is its great line-up, says media strategist Virginia Hollis, who consults for Power through her company Magnetic Connection. She says Power’s smart hiring of already established talent will help to migrate listeners. “They have good people. Take someone like Eusebius [McKaiser, former 702 presenter and political analyst] – he had a great following on 702 and he will take this following to Power.” The new station has also attracted the likes of veteran broadcaster Tim Modise, spin doctor Chris Vick and TV presenter Pabi Moloi.
Kaya FM welcomes the advent of Power FM, says the station’s head of sales, Tyron Sharnock. It’s not a question of competing for advertising, but rather one of growing the profile of the black middle class, he says. And any quality black media will help raise their profile with advertisers. “We don’t feel threatened by Power FM,” he says. “Though I’m a little offended by the way they came at us hard in the beginning, saying they’d like to take listeners away from us. Black media has to stick together!”
But their strategy of creating hype on social media was brilliant, says Sharnock – and it benefited Kaya too. “The advertising pie is big enough… The black middle class is four million strong and rising. It has overtaken the white middle class in terms of consumer spend,” says Sharnock.
White men are still making significant business decisions, says Sharnock. “So we have to change perceptions about who our market is. The launch of Power made a big noise, which helps us a lot. They will increase interest in the black market and that’s great.”
Sharnock points out that radio listeners don’t necessarily choose between stations, but rather tune in and out of a range of channels. Competition is not the cut-and-dried thing it might be in print, for instance, where consumers may choose not to buy one title at the expense of another. “Do you listen to one station? No, of course not. Ten years ago, people listened to stations. Five years ago they listened to presenters. Now they listen to features.”
In terms of the sales environment, Power FM may have an effect, say Hollis and Sharnock. For Hollis, any new entrant into the media means a stretching of capacity at media agencies. “Having yet another station, as well as all these new TV stations, complicates the sales environment. You need a lot more people to handle the volume of work – and there aren’t any! The environment gets more and more fragmented, and you need better people. But you can’t train people quickly enough.”
For Sharnock, there is the potential for any new station to sell to clients at massive discounts (though he adds that he has no reason to suspect Power FM of doing this). “What I worry about is rate card integrity… When you are a brand new player, this is a difficult thing. It’s a buyer’s market and your rate card is going to be very low.”
Mkhari says Power FM is not struggling to attract advertising. “Four of South Africa’s top brands are already with Power. We have all but one of the cellphone networks, as well as automotive, fast food, fast moving consumer goods and retail advertisers. For a station that hasn’t delivered Rams [Radio Audience Measurement Survey figures], we are doing very well; we are 250% ahead of our targets.”
Mkhari told M&G when Power launched that he was aiming for 500 000 listeners by the end of the year. But he tells The Media that the station will not be focusing so much on numbers. “We are now leaning more towards showcasing the quality of our listener,” he says. “We have first-time callers to any station phoning in and they are the founder of this or the chairman of that.”
Hollis says that even if Power FM does not have an impact, radio advertising is changing. “One thing the industry needs to accept is that there will be change. The community stations are offering competition now too! MixFM is fantastic at the moment. There’s just so much going on in that space.”
Whether or not Power FM makes a huge dent on the advertising front, there is a shift because of new competition and competition is good on all fronts and can only benefit the consumer.