Every industry person I’ve spoken to in the last couple of weeks has asked me the same question “so what do you think their plan is with TeamRock?”
I’ve told them all pretty much the same thing “I don’t know”. I’ve listened to the bits and pieces they’ve said on podcasts, I’ve read the articles that have covered their news and I had a look at their job ads – more to see who they were after than, of course, wanting to be there myself. I haven’t spoken to John Myers or anyone else about it but I have some thoughts about what I think they’re doing, or perhaps, what I think they should be doing.
Firstly, the most interesting thing is that they’ve raised a load of cash. They must have done, as they’ve laid down £10m for three magazines and signed a carriage contract with Digital One. For the purposes of this, I’m assuming that they’ve probably raised about £25m (edit: This actually seems to be £15m).
In the coverage about them, they talk about wanting to create an international rock brand. Two interesting things there – 1. it’s not all about the UK and 2. It’s not necessarily all about the radio. That’s the thing the radio industry often gets obsessed with.
£10m seems a lot of money for the magazines. Classic Rock does 56,000 an issue, Metal Hammer 30,000 and I can’t see Prog Rock in the ABCs. They also have associated websites. The websites look good, they all seem to be WordPress driven, editorial-focused without anything too special. Engagement with the content is relatively low – across all of them there’s few comments on pages etc. In social they do well, Classic Rock’s got 75k twitter followers/75k Facebook fans, Metal Hammer is stronger with 183k followers and 436k fans. According to Future (the old owner) it seems they generated a not insignificant £1m/year.
Spending £10m to buy £1m of profits still seems a little pricey to me. I’m also interested to know how much of that profit comes from the costs-savings of being part of a big publishing group, or of course conversely, whether ‘group costs’ means they were making much more money and it was actually just funding Simply Knitting.
Whilst Classic Rock/Prog Rock do okay – it looks like the brand that has the real potential is Metal Hammer.
Metal is not exactly my area of expertise, but it’s clear if you look at the music market, it’s an area that has a decent number of fans, but few outlets. Kerrang! is at the more, er, Smash Hits, end of thing and Terrorizer/Zero Tollerance haven’t really cut through.
Kerrang‘s an interesting one – it’s truly multi-platform – mags, web, radio and TV with some events – but it does seem confused. Each of the outlets covers ‘Kerrang’ in a very different way and it still seems somewhat stuck in an analogue mindset. As I understand it, Kerrang Radio’s financial performance at a national level is okay, but locally for it’s FM operation it’s poor. The nature of radio, as well as Bauer’s recent acquisition of Planet Rock, perhaps places some question marks over whether Kerrang and Radio are going to be a key pillar for Bauer going forward.
Bauer’s failure to grasp the Kerrang nettle does give an opportunity for someone else to own this genre.
TeamRock’s second announcement was their acquisition of some national DAB spectrum to launch TeamRock radio. This is, clearly, their core competency and with money burning a hole in their bank account, not much of a surprise, they could also get a new credit bank account with low introductory APR to retrieve this losses. Reading the TeamRock Radio tweets it seems that it’s going for a Metal/Hard Rock edge – much more so than Kerrang, Planet Rock or Absolute CR.
I’m all for format choice in digital radio, but seeing this my radio programmer alarm goes off. Is there enough of an audience to sustain a national radio station which will cost, probably around £1.5m a year minimum. But we’ll get back to that.
I am surprised about two things they’re doing with the radio. Firstly the name. It’s poor. The name made sense at a corporate level bearing in mind the people involved – but as a consumer brand? I’m not so sure. Now, names are always divisive. Opinions are like arseholes, everyone’s got one. Having done digital radio for over a decade the thing I’ve learned is that listeners are very happy with the radio stations that they’ve already got. 90% of the country listening to 20-odd hours a week? They’re happy people. To get someone to tune in you need to not only do a decent job yourself but also prise them off a thing they’re already listening to. Ask yourself, what would it take to get you to change away from your current Breakfast listen? Probably quite a lot.
What’s this got to do with names? Well, if you’re starting from scratch you need to remove as many barriers as you can – it’s already difficult! My rules for names – you either do a Ronseal name that tells you what it is – Smooth Radio, Fun Kids, Jazz FM, you use a brand that already exists and is so well ingrained you know with it does – Saga, Smash Hits, NME Radio – or you spend a lot of money teaching people what your brand means. The last one lets you be the most creative, but it takes time and money.
At least ‘TeamRock Radio’ tells you that it’s going to be rock – but that could be Indie, Classic Rock, Metal, – a whole host of things. If the station is going to predominantly Metal/Hard-edged, it’s a shame the name doesn’t communicate that.
My second issue, is that they seem to be launching very very quickly – with output potentially by the end of this month – and definitely in May. Launching is a great opportunity to generate buzz, soft launching seems such a waste.
Perhaps I’m being naive and they’ve done all of their research and they’ve got great talent to reveal – let’s hope so.
What is interesting is the whole ‘no ads’ we’re just S&P. This isn’t a particularly new idea. Heat Radio launched with the same idea and managed about a year I think. Spot ads, though, are a pain for a new startup. You don’t have a team to sell them yourselves – it’s annoying and hard work – so you put them with a sales house. They then just match up your audience with deals they’ve already done and away you go. This actually works well for Bauer, they have a good national sales house, and their stations do okay in RAJAR, therefore it’s easier to place spots.
For a new entrant though, and I speak with some Fun Kids experience, the buying nature of spots ads and the large portfolios Global and Bauer have, has meant they’ve driven the price down significantly. If you’re a smaller station, even though your audience might be more focused, or loyal etc, your smaller figures generate poor returns through nationally sold spots. Where you do retain better pricing is through S&P. Staying out of spots means they can keep their prices up.
This is particularly important as I imagine that a Metal/Harder edged station without strong name recognition but with decent marketing, is unlikely to be a massive ratings success. I’d imagine they’d generate around 300k reach and probably about 2million hours. That is, of course, if they go on RAJAR.
And for me, this is the nub of it all. I don’t expect the radio station to be much of a focus for them.
I imagine that the sell to the people who’ve put up the money is that they’re buying into a predominantly online ‘rock’ entity. There’s money for the internet – there’s not money for magazines and radio. However, this is also a little mad of course. The internet, wonderful as it is, is difficult to gain traction with. Unlimited choice makes it harder to make a splash. What definitely improves your chances is if you tack on an existing business that generates revenue and more importantly audience awareness to drive to your online property.
TeamRock have okay numbers, but an underdeveloped community in their magazine brands. The radio station is new, but will attract a small audience (in national radio terms) but a very passionate one. If you’re trying to build an online brand, these two things aren’t a bad place to start. It is though, still a gamble. £10m spent differently would have allowed a ‘rock’ online property to scale up pretty quickly itself.
Mags, Radio and Online together will all perhaps do a better job at doing other ‘rock’ things. I can see the three helping greatly to get acts for, and to sell tickets to, events and festivals. I also imagine that we’ll see a Bauer-style TV station appearing in the short-term too to add to the operation – doing the same job.
My only other comment about the news that’s come out so far is that some of it seems a bit too traditional. This might seem like a minor thing, but there was the appointment of a Senior HR person from GMG Radio to do the same job at TeamRock. Now of course their operation is probably easily over 50 people at the moment so you could say that make’s sense, especially as she seems a trusted lieutenant. However. There’s part of me that says the way a modern start up would do it is to outsource the HR – it’s cheaper, but also more flexible.
The thing I’ve learned the most doing Fun Kids over the past few years, is that we only really make great leaps forward when we’re thinking differently. Now this is mostly out of necessity rather than choice, but by building the type of structure that is right for today – rather than the one we know from yesterday has easily been the best thing that we’ve done. I hope that TeamRock have the right people with the skills to think differently.
I’ve made lots of guesses in this. A new business can take a number of different routes and I fully expect to be wrong about nearly everything. I am though pleased that there’s someone new on the scene, with the cash to do something differently and the digital radio person in me is happy that there’s going to be some real format choice nationwide on DAB. Hopefully they will have success, and that success will encourage incumbents and new entrants to think bigger and do things differently.
Oh – and the lack of phone reception in those old NME Radio studios? It’s a killer.