I was recently asked this question when I mentioned my plans to recruit some staff for a new radio station to one of my uncles and my response was Yes, it can be lucrative, but only if the right things are done.
With many radio stations struggling to pay salaries, shutting down operations, or barely surviving, it’s natural to wonder why anyone would still want to invest in a new radio station business. But, despite the challenges, many businessmen are still eager to enter the industry. 2 new stations are almost done with preparations to hit the airwaves in Ibadan while some will start before the end of the year
AFFORDABILITY OF STARTING A RADIO STATION IN NIGERIA
The cost of setting up a radio station can be substantial, with estimates ranging from 100m – 300 million naira depending on how big you intend to start and it can also depend on your location because radio stations located in Lagos, Port Harcourt, and Abuja are more expensive to start and operate than other states.
This money will cover expenses such as licensing, space, equipment, at least 4 operational vehicles(General Manager, Marketing Staff, News, and a general staff bus), and staffing.
SO, IS THE BUSINESS STILL LUCRATIVE?
The reality of the radio industry is that many CEOs set up radio stations with varying motivations, for some they just want to use it to tie down their money as they could sell off the license and equipment anytime they want, and some do it to achieve personal gains as we’ve seen from the politicians and clergymen but ultimately, every business owner hopes to reap a return on investment (ROI), the expectation of earning a return is a universal driving force.
However, when these expectations are not met, frustration sets in, and one of the most significant consequences is the inability to pay salaries. When staff members are not paid or adequately motivated, their motivation levels plummet, and the overall performance of the station suffers. This can lead to a downward spiral, ultimately resulting in the shutdown of the station.
Unfortunately, this scenario has played out in the Nigerian radio industry, with notable examples including Inspiration FM and Beat FM, both of which shut down their operations in Ibadan.
The radio business is still a lucrative venture, despite the challenges faced by some stations. The success of prominent radio stations and their owners is a testament to the potential for profitability in the industry. For instance, Chris Ubosi’s Megalectrics has established a strong presence with Beat FM in multiple locations, including Lagos, Abuja, Ibadan, and London, as well as Classic FM and Naija FM, which cater to different audiences.
Similarly, Serge Noujaim’s Aims Ltd has a diverse portfolio of stations, including Nigeria Info, Wazobia FM, Cool FM, Arewa FM, and Kids FM, demonstrating the viability of the business. Dr. Yinka Ayefele’s Fresh FM has expanded across the South West and Ilorin, with additional stations like Blast FM and TiwaNtiwa FM, further evidence of the potential for growth and profitability.
Other successful radio station CEOs, such as Dr. Larry Izamoje of Brilla FM, Late Raymond Dokpesi of Raypower FM, Oba Adebayo Akande MFR of Splash FM and Lagelu FM, Prophet Sam Ojo of Melody FM, Dr. Erastus Akingbola of Inspiration FM, and Prophet Sam Olu Alo of Adamimogo FM, Mr Greg Odutayo of Royal Root FM have also established multiple stations, indicating a strong demand for radio content and a potential for financial returns.
If the business is not lucrative, some radio stations will not be paying N800k salary to their OAPs, I know someone who earned N1.2m salary every month in Lagos before he left the country. In some places, some OAPs are comfortably earning N400k – N800k salary. Has anyone ever wondered how much Fresh FM generates on their Ajaabale and Opeyemi programs every week?
Don’t let anybody deceive you, there is good money in the radio business “if it’s properly done” and some radio CEOs are aware of this.
HOW LUCRATIVE IS THE RADIO BUSINESS?
1. Radio stations can attract high-paying advertisers and generate significant revenue through local and agency adverts – The biggest of it is from the media agencies, I know some radio stations that generate N15- 20m every month through the media agencies
2. Radio stations can diversify their revenue streams, such as through events, sponsorships, and digital content- When you see radio stations host events, they can make a lot of money from sponsorships
3. Radio stations that can build a strong online presence, through social media and streaming. I know some radio stations that have grown their social media presence, monetized it, and are earning a lot from it every month
HOW CAN A RADIO STATION BE LUCRATIVE?
Just like in every other business, the answer to this depends on how the business is…
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