Alexa, are you radio’s saviour?

When you have a problem there’s always a bit of you that hopes something will magically happen that won’t make it a problem any more. Of course, wish-based solutions aren’t the most reliable.

For radio stations that don’t have a well-thought out distribution strategy, there seems to be a hope that ‘the internet’ will solve any problems. IN THE FUTURE, these people often say, you won’t have to worry about FM or DAB (or whatever), THE INTERNET will make all that irrelevant.

The current adjunct to all of that is that SMART SPEAKERS are radio’s future.

But first, let’s rewind. What are radio’s problems?

Radio listening is pretty steady – 90% of the population consuming around a billion hours a week of radio – and it’s been like that for a long time. I think the key thing to be concerned about has been around young audiences – 15 to 24s.

Clearly there’s been a decline for both, though I think reach has held up pretty well – radio in the last 12 months reaches 80% to 84% of youngsters whereas 10 years ago it did 87% to 89%.

Hours have seen a much greater decline. It’s now 90m vs 10 years ago when it was 130m. However, though we’ll see what the next lot of data says in the coming weeks, if anything (looking at the last two years) I think that decline is slowing.

Why’s it been dropping though? Well, I think that’s two things.

Firstly radio, up until the beginning of the naughties has a lock on free music and entertainment. In 2000 – little broadband, no data on mobiles, we’d only had Sky Digital and Channel 5 for three years. Radio existed in a lucky monopoly. Limited new radio entrants, no real digital products and limited mass media competition. I think we have to look at 1973-2000 as the ‘we didn’t know we had it so good’ years. If anything youth consumption (and what will follow as that group age) is really just a true market correction.

I think our second issue is a lack of radio product development for teenagers.

Of course there’s stations like Radio 1, Capital and Kiss but they’re not really designed for teenagers. They need to have broader 15-34 appeal. Capital delivers more 35+ hours than it does 15 to 34s and for Radio 1 and Kiss around 40% of their hours are 35+ too.

Bauer’s in the process of closing The Hits, it closed Smash Hits quite a while ago and Kerrang has less distribution than its had in the past. Radio 1 itself is now playing significant ‘greatest hits’ content.

I find it difficult to listen to the radio sector prattling on about it being really important how we get young people to listen to the radio when they don’t really provide that much to grow the next generation of radio listeners.

Anyway, I digress, so if we hold demographic changes as a threat – some decline today with the young (and a potential for that to grow across other demos in the future) what else have we got?

Well, I think the big threat isn’t to the medium, I think its to prior business models. As mentioned before, in the ‘never had it so good years’ the market was entirely invented – a planned economy. The regulator decided where radio stations should be, what content they should provide and whether they got any competition.

The radio sector now, with 50% listening through digital platforms, is a market-led economy. Many small stations are still trying to operate the same business models they operated in the 90s without understanding that their competitive environment has changed. And that’s not just audiences with a choice of what station to consume. That car dealer who used to only be able to advertise with you? Now they can use Google AdSense and appear on local computers and mobiles with targeted messaging.

For decent sized local radio stations there used to be a nice national revenue cheque appearing each month. The inventory was sold at a lower price than local and it was a bit annoying around Christmas, but fundamentally it was free money. Now though, Global and Bauer’s share deals means that spot revenue isn’t as easy to come by.

This is why I get confused when people say that the internet as the delivery mechanism of the future will put everyone on the same playing field. Why? Let me get this straight, you want to gamble the way people listen to you at the moment (primarily for devices designed for that purpose) and you want to swap it to a device where you face untold more competition AND on a device that makes it harder to find you?

If a radio person says to you that the internet is the future for radio, the question to always ask them is “what’s your station’s website like and how does it do financially?”. If the answer is “it’s not very good or doesn’t make much money” then ask why you think they’ll be able to do any better in an internet-delivered audio world.

There are lots of companies that have made a fortune on the internet, where it has truly transformed what they do. It’s usually because they’ve smashed a monopoly, or the barriers of entry to a sector. It hasn’t tended to have come from the people who’s monopoly has been smashed.

If anything, Smart speakers like the Amazon Echo, only exacerbate the problem for small or new stations. Why? Because you need to know the name of the radio station to get it to play for you. New station discovery on those devices will be non-existent – there’s no channel guide or EPG to look at. The only people who will be successful in that space are those with brands and/or non-radio marketing spend.

So is it all doom and gloom? No, not at all.

I think there are a number of things that radio as a platform and radio stations themselves need to do to secure a strong future for their businesses.

1. Radio as product. Think about the radio ‘offer’. What is it that radio provides audiences? And can we make all of the UK get that product? That’s about content, being free-to-air, on any platform, but on those platforms always easy to use and easy to find. It’s the BBC and commercial radio nationally – 40-odd stations that cover the vast majority of interests and it’s local stations and those with local content too.

Yes there’s probably some build-out still to do, but the vast majority of people can get this radio product today. Rather than battling against each other shouldn’t we be selling these bundle of stations like Sky or Virgin do?

2. Primary radio platforms. We shouldn’t forget our biggest positive is that loads of consumers have these cheap boxes, that they like, that does ‘playing free audio’ really easily. FM is pretty good, but DAB is better. It’s better because it improves the radio offer. We deliver a better (and larger) bunch of stations, to more people in an easy to use device. Consumers have a better radio experience – a better experience of our platform through that device. A better radio product in that device means that Spotify and Bluetooth’d podcasts and all the rest has a harder fight to unseat us.

I’m absolutely not saying that we shouldn’t be in other places – of course we need to be everywhere. BUT we need to re-enforce our core broadcast platform. Right now we overwhelmingly own the audio space – we should defend it mercilessly, whilst attacking other platforms and colonising them with our great radio product.

The best thing I’ve learned from the Norway analogue switch-off is that they’ve upgraded the radio product. Everywhere gets more radio stations, some are new digital only others were the old analogue stations that just didn’t go to all parts of the country. Strikingly some of the ‘new’ stations have overnight become the most popular stations in the country. It turns out that analogue radio wasn’t delivering the services that consumers wanted, so when it went all digital their listening reflected their true desires, rather than relying on the planned economy of the 80s!

Getting people off FM is important. As digital listeners they get a better radio product. They will consume more radio and listen to more radio stations when they’ve been converted. The faster we move people across, the longer they’ll be exposed to our radio brands – and the deeper connection we’ll make with them. We don’t want people to think ‘there’s nothing on the radio’ if they’ve only got an FM radio and live outside of a big city.

I wouldn’t switch off FM tomorrow and I’d much rather consumers switched themselves – but it’s in our best interest to be more aggressive. Let’s send a clear message from stations and government that analogue will be ending (that doesn’t even necessary mean a date), let’s stop analogue only radios being sold, let’s turn off some more AM stations. At the same time we should be better promoting the content offer and reasons to switch.

3. The non-linear offer. Stations have to be delivering audio and multi-media that isn’t just re-hashed versions of what’s on their linear stream. I hate to break it to you, but the mobile phone is never going to be a successful linear radio. A phone is all about choice, interactivity and personalisation. Growth is not going to come from linear radio. Yes – of course – have an app that streams your station and be on Radioplayer etc – but it will, at best, replace some existing listening from a different linear device.

If you want to be successful digitally you need new products. You need to use the money you make from, and the talent that makes your linear broadcast to build out new products. What’s your podcast strategy? If it’s ‘Best of the Breakfast Show’ go into the iTunes chart and see how many of those do well. Where is your expertise – local, music, comedy, news – whatever it is to build out a suite of audio products and use your linear channels to kick start them and grow your scale. Podcasts, flash briefings, short-form clips – it could be anything.

What are you doing differently on video? I’m sorry you spent all of that money fixing cameras (with generally poor lines of sight) in your buildings, but clips from studios rarely work on YouTube. You are trying to impose your media style on a platform that has devised its own. Learn from the vloggers they build relationships and audiences with content – we should be great at that!

Have you got a content management system that allows you to distribute your content to new devices that may pop up? If you do good local news is it formatted for Google Assistant, Facebook Instant Stories, Apple News, AMP etc? Is it in a CMS that can easily cope with new places that might appear. Have you got someone who can mangle the XML to get it to spit it out to these new places? BTW, good local news isn’t just pasting your radio bulletin cue into the CMS and attaching a 12-second bit of audio.

4. Devote less time to social. Is your social media activity resulting in listening, web traffic or money? I’ve worked with stations where the answer is an emphatic yes and others where it’s a no. Post like counts or number of shares are addictive to see. But are we feeding that monster with content for our own gratification or does it do anything for our core business? Are you building content that benefits you? Are you creating audiences on platforms that you can monetise directly? Audiences that you control the relationship with rather than an algorithm?

5. Use your skills away from the live stream. I think radio has some great special skills. Entertaining DJs, local knowledge, access to guests, strong relationships with listeners, a news team, a sales team well-connected in the community, studio gear, events expertise, and much more. Why do we apply almost all that effort into just the linear stream? What a waste!

6. The only constant is change. Doing what you’ve done in the past, when there was less competition for ears and cash and hoping that everything will sort itself out will not work now, let alone in the futre.

Radio will maintain its relevance and grow by being focused on consumers and delivering them the best product we can on as many devices as possible, but also providing great reasons to get them and keep them on the platforms where we have a better chance of winning.

Radio stations will only maintain their relevance and grow their businesses by using their amazing skills to build and deliver great audio and consumer products to their listeners.

One thought on “Alexa, are you radio’s saviour?”

  1. I’d suggest Tim Westwood and James O’Brien get plenty out of their YouTube channels and video content.

    I disagree that DAB is superior to FM. If I listen to Clyde 1 on FM in the car, then switch to Kisstory on DAB there’s a horrible degredation of sound quality. Though I appreciate DAB has other benefits.

    I’m not sure radio is really on the radar for 15-25 year olds. As they get older, will it ever be? Surely that’s a serious problem for the industry?

    I’d suggest DAB is an interim technology. It’s like MiniDisc. I’ve never heard anyone other than people with a vested interest in multiplexes talk up DAB, apart from a few real audiophiles in the very early days. Whereas I hear constant enthusiasm for music and talk via YouTube, Spotify, podcasts, SBTV, the linkup etc etc.

    The only people who care about DAB, in my experience, have a vested interest in multiplexes. I got a new car last year and the Arnold Clark sales guy never mentioned the radio, assumed I wouldn’t want it, and told me excitedly how I could connect my phone to the audio system.

    I no longer work I radio, I’ve no interest in your distribution model, I don’t care whether I’m right or not, I just genuinely cannot see how DAB can have longevity and the only people I hear pushing it have a vested interest in multiplexes.

    And to be fair, even some of them, seem to be cooling on it.

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