Radio has two big problems today – growing media clutter and shrinking marketing budgets, according to author Matthew Ragas.

Ragas, speaking at the NAB Radio Show in the US, says: “In a time of shrinking media budgets and clutter, cult brands have a big market advantage” because they can help businesses “lock in repeat customers.”

Explaining the psychology behind the success of cult brands such as Harley Davidson or US broadcaster Rush Limbaugh, Ragas told Radio Show delegates:

“In the face of a fragmenting society, the people we studied told us that they wanted to fit in and have an identity. Every cult brand we’ve studied finds a way to fill this void… They are not just selling a product, they are selling a sense of belonging.”

He believes radio stations which interact with their audiences in the right way, and bring their listeners together to from self supporting communities, can achieve cult brand status by fulfilling the basic needs of “belonging and being loved.”

“People want to make a statement about who they are by what they listen to,” he says.

In Australia a recent example of what Ragas is talking about was seen at ABC702’s knit-in, where the station tapped a groundswell of listener enthusiasm and brought its “community” together for a charity knitting event in the station’s foyer.

Ragas’ 7 tips for creating a cult brand are:

1. Consumers want to be part of a group that’s different

2. Cult brand inventors show daring and determination

3. Cult Brands sell lifestyles

4. Listen to the choir and create cult brand evangelists

5. Cult brands always create consumer communities

6. Cult brands are inclusive

7. Cult brands promote personal freedom and draw power from their enemies

Ragas has published a book detailing his studies, which (you guessed it) is called ‘The Power of Cult Branding.’