State of Radio – Q2/11

I’m a big believer in RAJAR. It’s a big survey that talks to  lots of people. When i’ve commissioned my own research, using a very different methodology the numbers are comparable. Also, i’m a big believer in trend being the best way to look at numbers. Of course, there may be oddities in any survey, but your trend line is the best indicator for how you’re doing.

This is why i’m not that bothered about the ups and down of the majority of well-established radio stations. There needs to have been a major change at a station or in a market before that’s interesting.

On the big changes front, for many of the new Capital stations this is the first book that’s all Capital, having jetisoned any residual numbers from their previous incarnations. If you look at the network as a whole it’s only a marginal change of hours up 1% and reach down 1%. Other than some hours declines, for the majority of the new Capital’s its been just about business as usual. Two though, stand out – South Wales and Birmingham.

South Wales has seen its reach drop 15% and its hours 20%. That’s quite a drop for the old Red Dragon and looking at (perhaps an unrepresentative quarter) could suggest that losing its Welsh position maybe hurting it. At the other end of the spectrum, Capital Birmingham has added 20% to its hours. Is this the benefit of ditching the legacy of being an urban station and being reborn as a pop one? Only time will tell.

The other big change – BBC 7 to 4Extra – has generated another 400k listeners to that service. Why? Cross-promotion and being part of a wider brand family. It’s now the UK’s biggest digital station.

I also think Jack in Bristol deserves significant kudos for dumping an under-performing format and replacing it with one that’s cut through. It’s been another record RAJAR result and it looks like there’s still some room for even more growth.

Big changes (like the Original to Jack flip) produce behavioural shifts, but then gradual change can have the same effect too.

Gradual change isn’t as fun or exciting though. The transition from the analogue to digital world for the radio industry is something that’s certainly taking its time. Our listeners have had thirty years of analogue commercial and BBC radio available in every device under the sun – kitchen radios, hi-fi’s, portables, car sets – and in every place they go – home, car, work or on the move. The ubiquity of radio in form and location means that 90% of the population use it and  they consume an eye (ear?) watering 24 hours a week of it. It’s the kind of media consumption that any other product or platform would kill for.

At the same time we’re offering listeners digital radio options too. Though, to be honest we’re making it quite difficult for them. For content we’ve gone from ubiquity – every station (in my area) available on every type of analogue radio – to one where we  put different stations on different platforms (just compare the line-ups on DAB and DTV), for cost we’ve gone from ‘free at the point of use’ to charging people based on usage for some devices (mobile data), for devices we’ve gone from every form factor being available cheaply (or often free) to one where you pay a premium and sometimes it’s hard to install (like in-car DAB).

We’ve also done all of this whilst continuing to provide radio that they’re used to, is still free and works on every device.

Looking at it, it’s amazing that anyone’s decided to listen to radio on DAB, Digital Television or the Internet.

But they have. They’ve decided that they want something more than what’s provided on analogue – be it choice, coverage, quality, ease of use. Now they haven’t decided to opt-out of analogue (even the most ferverent digi-phile still uses analogue in someway) but they’ve added a chunk of digital ‘to fix’ their radio listening.

Sometimes people who work at (predominantly) analogue radio stations dismiss the need for digital – they talk about it not affecting them – that their digital listening is small and not growing. They often forget that analogue and digital needn’t be mutually exclusive.

Our listeners are more than comfortable being multi-platform – listening to some stations on analogue devices and some others on digital ones. In probably most households the analogue device consumes the majority of listening, the digital the secondary.

I think all of these things hide quite fundamental changes. Though, as I started to dig through some of the data, you start to see how our listeners are building a new parallel structure of listening.

The availability concept can be demonstrated by NME Radio. Its been on and off a number of platforms in its short life. However, the reach over this time stays pretty static. Why? Well, listeners need to be aware of the service and then if it’s something they would like to listen to, they then seek it out – however they can get it. The circled area is when NME was nationwide on DAB. A small reach increase, but a massive hours jump. Why? The awareness doesn’t change, but suddenly a lot of these listeners can get in on a device they have more access to – their DAB digital radio – a device that’s much easier to listen for a decent length of time on (no fighting those in the house who want to watch Eastenders on the digital TV).

The dominance of analogue radios for primary listening points can be seen in the chart below. This shows platform consumption over a weekday. Breakfast and daytime is dominated by analogue radio, which then, like all radio drops away as we get into the evening. DAB (the red) and DTV (the green) grows – I’d wager these are  people opting out of traditional listening to consume non-analogue stations.

Availability of listening on digital devices is strong – over 40% of people listen to some type of digital radio each week. It’s interesting to see how Absolute have used their new stations to repair and then grow their total hours. At a time when there have obviously been issues for their main service, they’ve weathered the storm by bringing new products that are bringing significant hours to their business.

In fact the impact is such that they are transitioning into a predominantly digital business:

The thing that Absolute are actually benefiting from is wide digital radio reach but a low number of new mainstream choices for listeners.

This latent demand can be seen by the next chart – this is the Eagle TSA and analogue/digital reach. It’s not stacked, so the blue is analogue at just under 500k listeners, with digital at around 250k. Now this is a TSA where the local multiplex hasn’t switched on yet – so the Eagle only exists in an analogue (and internet) environment. For an ILR The Eagle’s doing quite well at the moment, but what I’d be worried about is that, at speed, the TSA are listening on devices that I don’t broadcast on. As these radio listeners transition from the devices being for secondary consumption to primary consumption the competition in the marker (even if we assume they’ll be on digital) will be severe.

If ever there was a need for evidence that there’s the ability for swift change is to look at the success of the transition of Radio 4 Extra from BBC7. Adding 440,000 listeners in one quarter isn’t about gradual development of new platform listening – its 440,000 digital listeners ready to switch into content that’s been promoted to them.

Last chart for today is one showing analogue vs digital hours for the BBC’s national stations:

To me this is the bell weather. The BBC’s national stations are available everywhere and the services have high awareness. There’s a mix of analogue favourites and new digital stations too. Taken as a whole a third of their output is now consumed digitally.

If unlike the BBC and Absolute, your output isn’t being consumed digitally at a similar pace then I think you have a problem. The audience is tooling up to consume more radio digitally – both to new and existing stations. Well over 40% listen digitally, the barrier isn’t the idea, its just a physical issue –  analogue sets are currently occupying the places that generate the most consumption.

If I owned or worked at an existing analogue station it’s not whether my reach was up 2% or that Capital nudged ahead in the market – it’s whether i’d built a brand that was going to be consumed by digital listeners – because that’s who my listeners have become and there’s far more competition on that dial.