Using Talent to Win on the Radio

K and J

 

A couple of stories have popped up this week concerning the power of talent to drive radio station successes.

Over in Australia, ARN managed to snatch the number 1 breakfast show in Sydney from 2Day FM. The talent were so important that ARN junked its Mix brand and created a new format that better suited Kyle and Jackie O – the pair they grabbed – KIIS.

The big question in the market was whether listeners would move up the dial. Were the draw of K&J big enough, or was much of 2Day’s success in their own brand?

Well, the results came out this week and K&J became joint number one in the market and they took their station from the least popular FM music station (7th) straight to number 1. Meanwhile 2DayFM went from number 1 down to the bottom, the 7th and least favourite FM music station.

This a storming result for KIIS  shows what an essential part of 2Day that show was. I don’t, however, imagine they’ll stay in that position for long. Their own new show will get better and some of the excitement about the change will likely fade a little.

Grabbing talent at the top of their game though, backed by strong marketing and distribution paid off for them. It’s also something that’s paid off for the BBC quite a bit here – see Evans joining R1/R2 etc.

K&J’s success has created a ‘the only way is talent’ mantra in  lots of Aussie radio discussions. However that tends to skip over the other success story in this ratings round and that’s Smooth FM. Paul Jackson (ex-Capital, Virgin and Richard Park’s son) took hos company’s perennially under-performing station Vega/Classic Rock and re-branded it 18 months ago as Smooth. Basically think Magic London. Whilst it has the occasional name, it is very much a music-driven radio station. The result has been a rapid rise to the number three FM music station in the market and I imagine there’s still some growth their yet.

The other story that caught my attention was Fubar Radio. It’s a predominantly comedy/entertainment speech station that emphasises its “we’re on the internet we can say anything” position and is a subscription service – £2.99/month to tune in.  It’s basically a comedy 6Music. They’ve got shows from people you’ve heard of – Mark Dolan, Richard Herring and Jarred Christmas and have just added a daily show from Justin Lee Collins and a weekly show from Sean Hughes to the line-up.

You get a 7 day trial and I’ve had a bit of a listen – it’s a good listen and an entertaining station.

I think their positioning is probably off though. I’d concentrate on the entertainment angle rather than “ooh, we’re naughty”. Most of what I heard would  actually be absolutely fine on a terrestrial station. What’s interesting about them is that they’re speech-led with good talent.

I’m also not massively sold on the way the subscription works – I don’t think they’re maximising the opportunity they have there. It’s also a tough model to make work in the UK. The choice of UK stations is pretty good, it’ll be difficult to make someone not only switch from a station they love, but also pay for the privilege too.

However, more power to them for having a go. Just as there’s always more than one way to win, I’m sure there’s also more than one successful commercial radio model too.

BBC Three Switch Off Update

Danny Cohen

My last post’s guesses about the announcements today were pretty accurate (point 5 in the top bit).

Turns out they’re basically saving £50m and then re-investing £50m in content for BBC3 on iPlayer and (politically friendly) drama on BBC1, a channel who already has a £1bn budget…

I also think my strategy claims were pretty accurate to, here’s Head of TV Danny Cohen quoted by Media Guardian:

“In an ideal world we would not be taking BBC3 online in 18 months time, we would probably do it in three or four years time.

“But taking on the World Service cost £245m to licence fee payers, we took that in from the government in the last licence fee settlement along with another set of commitments totalling £300m. It means we can’t keep offering the same with less money.

“For BBC4, that means if future funding for the BBC comes under more threat then the likelihood is we would have to take more services along the same [online only] route [as BBC3].”

Cohen added: “By making the move we made today we know we can manage our funding through the licence fee period which ends in 2016/17. We will have to see what happens in the future with the licence fee whether we can keep BBC4 [as a TV channel].

In other words, BBC3′s been sacrificed to tell the Government to keep their tanks of the BBC’s lawn, otherwise their favourite channel – BBC 4 – gets the bullet.

 

Turning Off BBC Three

The BBC has a problem. It does quite a lot of things. Most of which are very successful. It generates a lot of money from the licence fee (£3.7bn) but it spends this on a vast array of services. Unlike the Daily Mail would have you think, because of the level of consumption of these services, the value for money is generally pretty good.

It’s problem is that the Government is not really a fan. It’s freezing its income whilst loading on the organisation lots and lots more costs – £340m a year (to pay for the World Service, Monitoring and S4C). It wanted to load on even more – the cost of licence fees for the over 75s – £566m – but the BBC managed to escape that.

Like any organisation it’s hard to pay for everything you’re used to doing if the budget’s cut. Up to now the BBC has made efficiency savings to cope with these additions as well as small cuts to programme budgets – salami slicing in popular parlance.

There is clearly always more that can be done in ‘efficiency savings’ – but it’s hard. What’s much easier is to not salami slice, but to axe something. A big chunk of costs suddenly gone.

Therefore a leaked suggestion that the BBC is going to axe BBC3 – and perhaps move it online – therefore saving a huge chunk of cash. A big contribution to the £100m they want to save.

Unfortunately I don’t think this is really about money.

If there is one thing the BBC is exceptional at doing is that it works very hard to guarantee its future existence. And as a supporter, I’m very glad it’s good at it too. But let’s get real…

The BBC3 announcement is the first volley in the next licence fee settlement and a pre-cursor to warn off more government loading of services or top-slicing of the licence fee.

The reason the BBC are willing to sacrifice BBC3 is because:

  1. It demonstrates they’re willing to make tough choices
  2. If they incur more costs from the Government that they will be capable of axing more things rather than meekly just absorbing costs as they have done in the past.
  3. They will be happy to ingest the negativity of the closure because it will burnish their credentials that they’re serious and it’ll remind the Government again that licence fee payers are not happy about services closing.
  4. It will have very little political impact. The political class despise BBC3 anyway. They don’t watch it and the people annoyed by its closure don’t vote anyway. AND unlike 6Music are not made up of a moaning media elite who are able to be noisy.
  5. There will be a sop about the service continuing to exist online. This is clearly rubbish. Some shows branded BBC3 will survive on iPlayer, though they’ll also end up on 1, 2 or 4 too. Also – the purpose of killing BBC3 is to save money and 80% of its costs are content (and let’s be honest the other 20% broadcast/infrastructure costs are probably just group costs that will continue to be incurred with or without BBC3 being ‘broadcast’). In other words the savings will all come from programming, so there’s no way they’ll keep paying for the content for an online channel at anyway near the current levels.

Personally I think axing BBC Three is about tactics and not strategy. It’s a clever (licence-fee related) wheeze, but it will probably bite them on the arse.

Why?

  1. It still requires Trust approval. This will take ages and they’ll be a consultation. The story will be re-hashed over and over again – more BBC negativity in an already hostile press.
  2. There will be a ‘campaign’ of some sort from viewers. It may or may not be successful. The result will either be a climbdown (painful) or ignoring the wishes of a chunk of licence fee payers (long term not a good thing to do).
  3. The BBC has a bit of a youth problem – keeping and engaging with this audience is difficult. The BBC are sacrificing the number 1 station for 15 to 24s – I believe BBC3 does better in the demo than C4 does. This will leave R1 and 1xtra as the only services dedicated to the young. A demo that, as discussed ad infinitum, the radio stations themselves have their own problems in maintaining reach and hours with.
  4. Demographically it also does well with C2DE’s, which unsurprisingly, tend to have much more reduced internet access. So let’s assume there is an online move of some semblance off the existing channel’s content to iPlayer, well , a large proportion of the target audience won’t have the gear to receive it. Whatever happened to universal distribution?
  5. The BBC will have to come up with some ‘stuff’ to say that 12 to 30 year olds will be catered for on their other TV channels. Hello again T4 style programming on BBC2 etc. This will cost some money. So the savings won’t actually be that huge when everything’s counted.
  6. The Government want to ‘get’ the BBC. They’ve now got over a year to respond to this tactic. This is enough time to negate it or beat it.

Net result? No score draw in the licence fee battle. But viewers lose a valuable, decently watched service whilst other people carry on playing their poker match

Exclusive Online Content

Jimmy

I try and generally be positive, or if not at least constructive with these blogs. The last post just about does that, though I updated it for the Radio Today Australia version with a few things from Australian social media that I liked.

I’m a big fan of examples, so when I saw this from Jimmy Fallon (the new host of the Tonight show on NBC) rather than try and squeeze it into a tweet, I though I’d post it here.

The video is part of an occasional series Jimmy does where he answers viewers questions.

What I like about this is it’s very lo-fi, very honest, not showbiz at all. He’s answering honestly and isn’t trying to be ‘up’ or showbiz. I think he builds a better relationship with the audience by coming across as a real person, sharing his answers with his friends watching.

It’s amazing that today when we regard ‘being real’ as a core radio presenter quality – we so rarely truly deliver it, let alone on other platforms. Let’s be a bit more like Jimmy.

Social for Radio is Not About the Big Number

Like

I guess these things come in waves.

The biggest issue ‘media professionals’ (for want of a better name) have with social media is that they’re obsessed with the big number.

It started off with the Facebook Page Like number or the Twitter number of followers. On the radio it was plug, plug, plug whilst someone in the studio hit refresh. Make it go higher, make it go higher they wished.

Eventually people realised that it wasn’t all about the big number after all. It was about ‘engagement’ – yeah man, what’s your Retweet to Follower ratio? Favourites are the new RT don’t you know? Engagement is more important, but a lot of the stuff around it is bullshit.

The same issue with that original ‘big number’ now plagues how people measure engagement. The volume of Likes, RTs or shares mean very little on its own.

What you should be measuring is the action generated by engagement. 

The Australian radio groups are now press-releasing engagement numbers like it’s the latest RAJAR sweep such as ARN have unexpected response to social post and Mix Facebook Post Reaches 20million.

The Mix story is that someone at the station found a meme that had been circling for god knows how long and then pasted it, with an intro, on a station’s fanpage. It became viral. Great. But what does it actually mean for the station?

Well, on the positive side, lots of people will have seen the station name and logo. However the vast majority of these would have been outside of the TSA. The Page’s name is one of the world’s most generically named radio stations and there’s a frequency but not location. In the text there’s no reference to what show it is, or where it is etc. There’s no link to the station’s website. There is a call to action to encourage comments, which is okay, I suppose.

But what does it do for the station? Does it help its positioning? No. Does it help someone tune in for the first time? No. Does it re-affirm any brand values? No. Did the station re-create the image in a better way and add some branding on? No. Did they include a next action on station-owned media? No.

They cut and paste an image onto a page that had a decent amount of traffic and then they were lucky.

I would be embarrassed that this got 20million because it does nothing whatsoever for the station.

It’s mean to just pick on them. Lots of radio stations around the world are obsessed with posting these memes because they get numbers they can be excited about. They are the only ones that care.

Radio stations’ fanpages that are full of memes are just lazy. They’re often unrelated to the station’s brand and positioning and they get in the way of content that pushes people to listen to the station or engage in places where stations can derive value. They also stop you doing the hard thing of making and promoting decent original content that actually engages with listeners.

People who click LIKE on your Fanpage or FOLLOW on Twitter are your superfans. They are your P1s. They love you. They want to hear from you. That’s you, the radio station, not you the meme-monkey.

There will be some followers who like the page because of the memes. THESE ARE THE WORST PEOPLE TO HAVE. They don’t care about your radio station, they only like the cats!

These real P1s should be pampered. 20% of your audience probably provide 65% or more of your hours. They should be worshipped! You should find ways to reflect your output even more! By clicking like or follow they’ve already told you they’re hungry for it. Where’s that video clip from the actually hilarious bit of the breakfast show, where’s the extra clue to the contest, where’s the pic of that embarrassing situation their favourite presenter got into?

If you sacrifice these things for merely viral posts, you’re mad. The only value you’re building is that for Mr Zuckerberg. 20million views – means a couple of hundred million ad impressions for him. Well done. No wonder he can afford WhatsApp.

What the success of the viral memes should tell you is that at your station you have the tools necessary to make something go viral. That’s a brilliant thing to have. Why don’t you then make some content that is connected to your brand’s values, helps position you, as well as is fun, or silly, or racy, or whatever. Of course it’s harder to do than pressing CTRL-C and CTRL-V, but at least it will be worth something.

To me, good Facebook pages, or Twitter feeds are places that combine a number of things together that help show you to be a rounded person (or brand).

In Facebook, it’s the combination of links, statuses, images, videos, content, promotion and hey, even the occasional meme – it’s something that shows your brand is real, accessible and worthy of being part of someone’s life. Indeed, worthy enough to be within a newsfeed that’s mainly what their ACTUAL friends are posting.

And at your station? Please never get obsessed with the big number. It doesn’t really mean anything.

Communicorp Acquires Global’s Disposals

ls

It’s finally been announced. Global Radio has disposed of the stations it had to, to Ireland’s Communicorp.

When Global Radio acquired GMG Radio, unexpectedly for them, the Competition Commission decided that it would give them too much control of the local advertising market (they were fine about audience share and national revenue control). They then set them quite strict rules about what they would have to let go. This somewhat got in the way of Global’s desire to grow their Heart network as the disposals would likely cut across different brands.

However, the deal they’ve done with Ireland’s Communicorp is nearly perfect for Global. It was also a brilliantly well kept secret – no one that I talked to knew anything about it. Truly amazing and not something that tends to happen nowadays.

What the deal really means is that Global gets to re-imagine UK commercial radio along their own lines.

Capital

All the existing Capitals remain. However, Capital South Wales and Capital Scotland will be owned by Communicorp.

In addition a new Capital appears – Capital North Wales (owned by Global). They can do this because the frequencies that Heart in North Wales are on, are the old Marcher frequencies that used to be ILR radio stations. The formats of these are quite broad and so could easily ‘host’ either a Capital or Heart brand. Heart will leave these frequencies and re-appear on the current Real North wales frequencies replacing that brand.

Global will provide the Capital brand and network feed from Leicester Square.

Heart

Heart becomes a truly national brand.

Communicorp gets Real Radio Yorkshire (to be rebranded a Heart). Global will take on Real Radio North East, Real Radio North West, Real Radio Scotland and Real Radio South Wales, rebranding them all as Heart.

Global will continue to provide the Heart brand and network feed from Leicester Square.

Smooth

Global announced that Smooth is coming off Digital One. This is because it starts to get complicated from a local ads perspective. A D1 listener in Newcastle would get national ads on DAB, but an FM listener would get local ads. It gets commercially complicated, so Smooth is split back into a network of local FM and DAB stations.

This has an affect on local programming too. By not being ‘national’, Smooth has to provide seven hours of local programming for each of their areas. Unless, that is, Global’s patchwork of local Smooth coverage gets up to 70% – if that’s the case it’s still regarded as ‘national’ and therefore none of the regionals (whoever owns them) will have to do local content (thanks to Will Jackson for that spot).

Smooth London, Smooth West Midlands and Smooth Glasgow will be owned by Global direct whilst the Smooths in the North West, North East and East Midlands will be owned by Communicorp.

In addition it seems that most of Global’s AM stations will be rebranded as Smooth – and take the Smooth network feed. Something that will increase DAB as well as analogue coverage too.

Global will continue to provide the Smooth brand and network feed from Leicester Square.

Gold

Gold loses a lot of its AM transmitters but will continue in London, the East Midlands and Manchester (where Smooth exists on FM).

Global will continue to provide the Gold brand and network feed from Leicester Square.

XFM

Global keeps the London and Manchester XFMs, but also adds what’s currently Real Radio XS in Paisley to the network.

Global will continue to provide the XFM brand and network feed from Leicester Square.

Still to come…

I’m not exactly sure what will happen with Real XS in Manchester (now owned by Communicorp).

There’s also a question whether the new “70s, 80s and 90s” brand that will go on Digital One could end up being what’s know at the moment as ‘Gold’ – but could, of course, be rebranded as something else… Heart Classics etc.

Summary

Overall, it puts Global in a very strong position. They’ve managed to satisfy the competition commission and hit their national brand objectives completely.

They’ll continue to provide national programming and sales and I wouldn’t be surprised if the Communicorp stations are co-located in Global buildings too.

Mark Lee who’s run Real and Smooth Ltd in the interim for Global has seemingly done a great job and will now get to do that in an expanded fashion as the UK Chief Exec for Communicorp.

Thoughts on RAJAR Q4/2013

Radios

Well, what have we learned from RAJAR? Not a lot, as everyone’s been trying to finish their Radio Academy Award entries.

So, after a quick glance…

Radio 2

Jesus, Radio 2, give it a rest. Let some of your listeners listen to something else!

It’s another increase for Radio 2 , they’re now at 15.5m listeners and 181m hours, that’s a 17.6% share of all radio listening. It’s an amazing result, driven by great talent, especially at breakfast, a clever ‘station we all agree on’ music policy and targeted specialist programming that’s out of the way. There’s also the bonus of no ads and a £47.8m content budget! Yes really!

6Music

Whilst we’re at Western House, its sister station 6music had a great book too (maybe it’s in the water?).  1.96m reach and 17.6m hours. It’s a whisker below Radio 3′s 1.99m, but way ahead on hours. R3 manages just 11.1m. That’s the odd thing about Radio 3, its average hours are quite poor – just 5.6. You would expect a specialist station like this to have much higher average hours – only 1Xtra has lower average hours if you look at the BBC’s national stations.

Commercial Radio in London

London is a competitive place to be.  Market leader is now Capital with a 5% share. They’re also number one for reach with 2.1m listeners. Also with a 5% share (but with just 50k less hours) is LBC. Back to average hours – LBC is nearly the market leader and whilst it has the same share, it has half the reach of Capital. But boy do its listeners give it their time – 10.6 average hours. Capital has stuck stubbornly for the last year around this disappointing 4.7 mark – its share would be much higher if they made people listen longer. Kiss, Magic and Heart all do better than Capital on average hours.

A dismal performance for Heart London, a 3.7 share and reach lowest for a long time, at least the last 5 years with just 1.55m listeners.

(Paul Easton later tells me it’s the lowest since Q4/2000)

Heart’s not doing that much better across the UK either. Heart’s ILR network is now reaching 6.4m people with 44m hours – its lowest ever figures. To put that in perspective. Chris Evans, on his own on Radio 2 does 36.2m hours.

Not a great result for CapitalXtra this quarter (which I think was half Choice and half Xtra?) 470k reach is below where they’ve been for the last few years. But still early days for this new brand.

Another disappointing one for XFM who’s audience does seem to bounce around a bit – London reach now 440k.

Smooth did OK (but still a low base) reach static, now 442 vs 441 last quarter. Hours back up a bit to 2.2m. Nothing to write home about.

Collectively however, this means the lowest total hours for Global in London ever.

Manchester

Slightly odd results in Manchester for both Key 103 and XFM. Key’s reach skyrocketed from 395k to 570k, with hours nearly doubling whilst XFM saw its reach drop back to its average over the past few quarters – around 180k, but its hours nearly halved.

I imagine this is a bit of a hiccup for both stations and will be corrected next quarter. However, it’s probably the first time when a wife (Kate Cocker, PD of Key) has nicked a load of hours from a husband (Tim Cocker, Breakfast XFM). Both are brilliant radio people, but I wouldn’t want to be round their kitchen table this morning.

Digital Radio

Digital Radio continues its march. 57% of the UK now listen to some form of digital radio each week (36.8% of the UK listen with DAB, 17.1% through their telly and 16.8% through the internet).

Digital hours now account for 36% of all radio listening (of that 65% is DAB).

Grimmy

It looks like Grimmy’s last book was a bit of an anomaly (5.5m reach) and he’s returned to a more healthy position – 6.29m listeners. It’s still down year on year, but it’s his highest reach figure for the past 12 months. His 15 to 24s are still lower than Moyles though and this quarter he’s added more 25 to 34s than any other demo.

If we compare Moyles in Q4/11 with Grimmy in Q4/2013, Radio 1 are able to say that Grimmy’s making the breakfast show younger. Just. Moyles 15 to 24s made up 29.4% of his audience, it’s 30.9% for Grimmy.

Moyles average age in Q4/11 – 33.6, Grimmy this quarter – 33. It isn’t particularly a Nick thing – all the shows follow a similar pattern (and similar age). Radio 1 as a whole in Q4/11 – 34.2, today? 33.7.

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Other RAJAR blog posts

 

Working Together as One Product

2014 is set to be another busy year for radio. Whilst Global Radio’s acquisition of GMG and Bauer’s need to respond have been a big driver, the key catalyst is the change in consumer behaviour and the opportunities it will provide.

The real engagement in digital  by Global and Bauer is led by opportunity. Consumer media consumption is resulting in the biggest change in listening habits for decades. Listeners have historically been given little radio choice, but the digital platforms have broken that monopoly. Listeners are seeking out what best suits them, rather than tolerating the least worst option.

This puts many listeners ‘in play’ for the first time in a while. With stations like Absolute 80s, Planet Rock, 6Music and 1Xtra grabbing a million listeners or more – developing and deploying a strong selection of stations has suddenly become a very obvious thing to do.

That’s not to say that the analogue stations are going anywhere in particular. Whilst their average hours are sure to face an inexorable decline, their reach and awareness is strong and FM is still a great platform to be on – loads of devices have it and there’s a restricted supply of new entrants. We should squeeze the benefit out of it whilst it’s still relevant and well-used.

However, with local hours under fire and local regulatory commitments to service, their long-term profitability is very much in question. Global’s resilient profits have been driven through significant cost-cutting and a strong brand roll-out. The addition of some more stations to the network will mean a repeat of their now well-practiced exercise.

It will be interesting to see if the buyers of the stations Global has to sell will choose to be a franchisee of a Global brand or go their own way. If they do become a franchise it’ll be a sure sign that the economics of running even a regional station are tough to make add up.

Ofcom’s recent correspondence about Heart Cornwall is also very little to do with the output down there, it’s very much a warning shot across the bow of what Global (or a franchisee) will be able to do to the Real Radio stations.

Global started it with Heart, but I imagine there’s more to come as owners decide what to do with their maturing/declining analogue assets.

At a larger group level, the regulation and costs associated with running these smaller stations does start to seem crazy when a well-executed, regulatory-free service like Absolute 80s or Kisstory can engage with a million people from a standing start. I’m also not sure whether increasing speech at certain points from 30% to 50% on a single station in Cornwall will make much of a difference if your listeners have already made the move to listening to 6music on their digital radios!

This change the industry faces is completely led by consumers and their ready access to more media.

As an industry, that’s what we need to be focused on – the consumer, and how our product offer fits with their lives. I often think that we should stop competing with each other – our (joint) enemy is other things that compete for our listeners’ time.

When we look at our digital radio product (DAB, DTV and our stations online) it actually does incredibly well – with over 17million people already using it every week. As throughout history, the rise of streaming services, just like television, walkmans, CDs, iPods, the Internet etc hasn’t really caused us that much trouble. Well, it has definitely caused us (in the UK) considerably less trouble than it has in other territories around the world.

Quite a big reason though is history and dumb luck. The dominance and quality of BBC radio and commercial radio’s attempt to keep up has meant that our radio ‘product’ is really very good. And really we should start to think of what we offer as a whole – commercial and BBC.

As ‘radio’ we offer listeners a high-quality ad-free music product (through Radio 1, 1x, 2 and 6m) and well-resourced news and speech services through Radios 4 and 5 and LBC and talkSPORT. We offer two classical services – one high and one popular. We offer local radio channels (some music, one speech) targeting different demographics and localised for every area of the UK. We also offer a range of national and quasi-national stations playing different types of music, around 20 ethnically-targeted stations and even a children’s radio station too. Taken together the radio product is pretty good. It’s why 90% of the country choose to use it each week for a 1billion hours of listening.

I think, in our internal focus, we forget that it is actually one product – Radio. We need to ensure that ‘Radio’ is something that continues to be understood and valued.

I hope that we’re coming to an end-game of what Digital 1 will look like – the chopping and changing will start to stop and we will be consistently able to offer listeners a great choice of stations that cater for a variety of needs.

If we’re offering a ‘Radio’ product – whether that’s consumed on DAB, DTV or the Internet – it needs to be  consistent, of quality and well marketed.

We are not immune to occasionally thinking this way. Radioplayer is a great example – a consistent product in webplayers and an excellent app on mobile and tablets that brings all of our stations together. Something we can all point to, and be proud of. And reading the comments in the app stores, is something listeners are proud of too.

But more than technology, I also think we can go further with how we market our product. I no longer think that solely concentrating on single channel brands should be our 100% focus. I’m not however advocating the tried-overseas, “isn’t radio great” marketing campaigns, usually just played on the radio.

Reach, even with young people, isn’t a big problem for us. Our enemy is time, the time consumers spend with our competitors. It isn’t because they dislike us, there’s just more stuff to do than there was in 1995. We were lucky we had these people to ourselves then, now we need to work harder to keep them.

If we’re concerned about young listeners, why aren’t we creating products (websites etc) that brings content together from Radio 1, 1Xtra, Kiss, Capital, The Hits and Fun Kids – whether that’s audio or video – and use it to show our quality and collective product’s relevance?

Yes, I would rather people listened to my radio station than someone else’s. However to do that they’ve got to be regular radio listeners in the first place.

If we were all just one product – like Sky, or Sirius or Pandora – we would be using our selection of channels to demonstrate the value of our product to subscribers. We would also be marketing specific chunks of it to different demographics to give them reasons to subscribe and get involved.

That’s why I think it’s time for us to think of ourselves as one product and make sure we’re using our vast content and skill to make sure that we continue to enjoy the success we have and grow our impact for the future.

2014 Radio Predictions

Crystal Ball

It’s a terrible idea to make predictions.

I often flick through the rest of my blog and see how wrong I’ve been about lots of radio things. It’s really amazing that any of you bother to read what I write.

However, predictions are fun. They also probably give you more of an insight into how it looked like it was going to go and what you were thinking.

And sometimes it’s good to put your money where your mouth is.

Do leave your own predictions in the comments below too.

Global

To meet the terms of the Competition Commission Global have announced they’ll make more  announcements about the stations sale in February.

  • The majority of these stations will be sold to one company
  • That it’ll be a new entrant
  • That they’ll keep as many stations that they can so they’ll own the majority of a UK-wide Heart network and and England-wide Capital network.
  • However, the vast majority of stations that will be acquired will choose to continue franchising Capital, Heart and Smooth from Global.
  • The franchise model will work quite well and they’ll sign similar deals with other radio stations by the end of the year

Bauer

I think 2014 might be the year of Bauer with lots of changes and developments in the group.

  • They’ll keep Absolute as a brand, but all the spin offs will disappear
  • Magic will go nationwide on Digital One, but will have a big refresh
  • One of the Kiss branded stations will go on D1  as well. Kisstory would do well, but Kiss Fresh would put extra pressure on Capital.
  • We’ll see networked mid-mornings across the Place network (probably one for England, one for Scotland)

UTV

  • The sport business – talkSPORT/Sport Mag/Web etc – will be separated from the rest of UTV.
  • They’ll launch a digital-only station

Radio 1

  • They’ll be big changes to the breakfast show. Not necessarily a replacement of Nick Grimshaw but an alteration of the dynamics of the programme.
  • It’ll have a tough year with RAJAR as they try and get Breakfast right.

Other thoughts:

  • Digital 2 will be a very competitive bidding process and they’ll be at least three bidders.
  • 6Music will have a bigger reach than Radio 3
  • Radio 2 will add a female presenter to the daytime line-up
  • We’ll have a scandal at Radio 4. In between the pips.
  • Digital radio will continue to get a bad press but share will edge up to 44%.
  • 80% of new cars will have DAB as standard
  • There will continue to be no successful/business-like internet/mobile radio stations
  • Celador will acquire at least 10 new stations
  • The BBC’s Playlister won’t have captured users’ imagination
  • We’ll see a pop-up station from the BBC.
  • They’ll be some more tests of the new DAB mini-muxes

What are your predictions?

Picture from Mo.

Phase 2 of Digital Radio in the UK

On Monday, Ed Vaizey, the communications the Minister will take part in the Go Digital event at Broadcasting House in London and make some announcements about digital radio. If the papers are to be believed, he won’t be binding the Government to a switchover from FM to digital – but then he wouldn’t be the first politician to alter their direction of travel with an election coming up.

What he will talk about  is the kick-off of another round of changes that alter the direction of radio. In truth, it will bring together many of radio’s factions and bind them around a plan to suit how listeners have changed how they now listen to radio and consume media.

It will also provide a unique get out clause for some in the industry to take. It will unshackle them from big radio’s ship and let them go their own way.

Phase 1

Digital Radio was born out of frustration and competition. Not by listeners, but by industry. Six competing radio groups of similar sizes wanted to be able to grow and get around the limitations of the regulated world they existed in. The largest, particularly the Capital Radio Group, were quite happy with the status quo – whilst those with something to gain – mainly GWR – was keen to push to a digital world. Like all technology you over-estimate what the short-term will deliver and under-estimate what will happen in the long term.

Digital Radio’s growth was slower than anticipated. But then again, the radio industry had never really launched a new product. Their other attempts at diversifying – restaurants, online music streams, shopping portals, local websites – fared even worse.

The commercial national multiplex and Planet Rock, the local multiplexes and expanding footprints of brands like XFM, pressured the BBC to follow suit. Strategically this digital explosion would affect their stations and the value they delivered listeners. Their answer was Networks X, Y and Z – Radio’s 1xtra, 6Music and BBC7. EMAP, a magazine company with brands and access to spectrum then pressed the button on music radio and TV services delivered on Freeview and local DAB – Kiss, Kerrang, Magic, Mojo, Q and Heat.

The demand for multi-platform expansion conjured up a new national multiplex and a new entrant – Channel 4. C4 realised that it needed to be a multi-media entity and with strong commercial success ‘doing some radio’ didn’t even seem that complicated or expensive. Their fall from grace was driven by two things. First was the economic crash, the second, rarely talked about, was the existing radio industry’s desire not to play ball. A strong new entrant was not something that radio (commercial or BBC) really wanted, and behind closed doors they decided to give the new boy a particularly hard time. This frustration and the economic change, made C4 pull the plug.

This wasn’t the only corporate activity that was changing radio’s direction. Over a few years Tim Schoonmaker’s departure from EMAP, Fru Hazlitt’s desire to ‘save’ GCap, Digital One‘s pricing model, consolidation across the sector and the arrival of Global and Bauer alongside a massive economic collapse certainly re-aligned everyone’s views. Trendy multi-platform was out – sticking to the knitting was in.

However, one thing the industry chose not to pay attention to, was the change in how people were listening to the radio. Slowly but surely consumers have expanded the number of stations and platforms they listen in on. The UK leads the world in digital listening – with half of consumers now listening on a non-analogue device. Each week over 11m people make time for new stations not on the AM or FM dial.

Post-economic slump, the one group that was watching the changing behaviour was Clive Dickens and the team at ARI. Clive left Capital in 2000 and spent much of his time outside of radio and the UK. A combination of external new media consultancy and a few UK radio projects (Juice, FM107.9, Jack) gave him a slightly less-jaded perspective than a lot of radio who had been somewhat stuck fighting it out in the trenches over the previous decade.

With Virgin Radio up for sale, ARI had been working to acquire it. With the financial terms tough to achieve, they ended up fronting the Times of India’s bid for the station. With some money to play with and an asset with audience, Clive and the team worked to deliver their own vision for what they saw of radio’s changing audience.

Absolute did lots of things – but the success of their decades stations – particularly Absolute 80s – is where they had the biggest industry impact.

Up until then, everyone had launched new brands. But with no marketing, they  found it hard to gain traction with listeners and enthusiasm inside their businesses. Robbed of resources or sales focus, many languished.

For Absolute, the decades stations was an attempt to solve a problem – declining hours and revenue – and an expensive main operation. With digital listening growing they thought these services would be a cost-effective way to bolster hours. They were right. They’ve nearly doubled the group’s hours. They also aggressively sold the hours as a network with their main station. The stations continue to generate cash for the business. Without them, the company would have lost more money.

Up until this point the new Global Radio was not enamoured with digital radio. With an eye for a monopoly, the failure of digital radio, would have left them in an even stronger position. But it wasn’t just Absolute’s success that changed their mind.

The BBC was faring somewhat worse. Whilst 1Xtra and BBC7 were doing okay, 6Music’s cost per listener hour was just too expensive to continue. Spending £6m a year on something generating 500k listeners wasn’t good public service business. As we know, its threatened closure gave it radio’s best ever marketing campaign, supercharging its audience on the way to 2m, suddenly meaning its cost per listener hour was good value.

6Music and Absolute 80s successes were being observed elsewhere. With Global having rolled out Heart and Capital across previous local FM licences, they also picked up spare spots on mutliplexes up and down the country. Suddenly these ‘out of area’ and digital hours made up a growing part of their business – from 15% when they acquired GCap to over 30% now. Suddenly it wasn’t a nice to have, it was essential and even opened up a way to consolidate their lead even further.

Global’s rising scale and their announcement last year of a Real and Smooth acquisition suddenly meant Bauer had to do something before they ended up a far away 2nd place in the market.

They needed new hours, fast. So they acquired Planet Rock, Absolute Radio (and all of those spin offs), pushed Kiss national on DAB for the first time and launched their own spin-offs with Kisstory and Kiss Fresh.

All of the commercial groups had realised that digital had meant consumers were broadening their listening. They no longer needed to make them abandon Kiss for Capital or Heart for Magic, as  the playbook for the last two decades had instructed. Instead, if they had the right brands in the right places they could start to grow again by chipping away at competitors’ hours.

Nearly 20 years after Ralph and co. at GWR thought digital spectrum would let them expand, it turned out it was the changing consumer behaviour (driven by platform growth) that would allow commercial radio to expand (and the BBC to provide popular services for licence fee payers).

Monday’s announcements

The change in the big groups’ attitudes has been driven by consumer take up of digital radio – 56.7% of listeners tuning in digitally every week (reach) and give 35.6% of all of their listening (hours) to digital radio.

Whilst digital radio consumption continues to grow, it does so steadily, rather than explosively.

If take-up speeds up, then it means the BBC and Commercial Radio will pay less for transmission but it also means that radio consumption will stay high. Digital listeners listen longer because they have more choice and enjoy radio more. This is good for the industry and good for commercial radio’s business model.

So to accelerate it, there needs to be further carrots. We’ll see these in the form of the Government/BBC/Commercial Radio jointly funding the further roll out of local digital radio transmitters. It also seems that we’ll see the advertisement of a second national multiplex and therefore more national stations. I also imaging we’ll see a renewed focus on marketing, particularly with cars.

FM switchover

What we won’t see, is the ‘stick’ of any firm news about FM switchover.

I think this is a shame. Some further certainty about the end of big stations on FM would have focused the mind of manufacturers, stations and listeners and digital take-up would have accelerated. Just as it did with Digital TV.

It would have forced the industry to sort out a plan for migrating all commercial stations to digital and would have meant a plan for community radio to get hold of some more FM licences.

I’m not really worried about the bigger stations and the BBC. They have seen which way the wind is blowing and have adjusted their sails accordingly.

Who I feel sorry for is the smaller radio stations.

To start with, I’m sure Monday’s announcement will be a huge relief. If your business is really just an FM licence then suddenly it will seem like you’ve got a little more breathing room.

However, what I really think, is that it’s the beginning of the end for you.

However uncomfortable an FM switch-off may have been, at least it would have forced those stations to develop a plan for the future. Now what will happen is mainly nothing.

Already stations like Wessex FM, Wish and The Revolution have faced hours competition from stations on DAB, DTV and Online and struggled with an on-air product optimised for analogue days. These stations now have little radio hours growth opportunities and their lack of investment in a modern website, mobile strategy or any broadening of their businesses will leave them in a precarious position.

But maybe there’s still time for them to change? Perhaps. However based on past experience I’m not so sure.

Groups like UTV and UKRD seem to have parallel strategies in their business.

UTV have an amazing cross-platform brand around sport – talkSPORT, Sport magazine, a huge and mobile-friendly website as well as an exciting international business too. I’m less sure about their ILR division – where is their growth? Simulcasting some of their stations on DAB and online is good – but what else? What about the stations that don’t even have that?

It’s a similar situation for UKRD. I think what they’re doing in Surrey is totally the right thing – a simulcast of their successful Eagle Radio and building on that with a new service – Eagle 3. If they can do locally with audience and revenue what Absolute did nationally – then they’ll enjoy significant success.

But what about the other stations? What happens to those stations marooned on FM with shonky websites and middle of the road formats?

For many of those stations, there isn’t currently a digital broadcast route for them – which is a real shame. Unfortunately by there not being a switchover announcement they’ll likely lose the impetus to fix that.

I also imagine that from an investment perspective, the stations without a digital future are likely to suffer in these group’s investment rounds. Why invest in stations that don’t have a digital future when you can re-enforce the ones that do?

Phase 2

Phase 2 is great news for listeners – it does everything they’ve asked us to do. It re-enforces coverage of local and national DAB and it will give them more stations to listen to.

It’s also great news for the BBC, Global and Bauer – it’s a plan they all agree on that will drive digital hours and give them more opportunities to grow.

For many, Phase 2′s protection of FM will be a ‘good thing’ – both for listeners who find that platform performs better for them and for stations  who have it as their only broadcast platform.

Consumers

Radio is, and always will be, consumer-led. The reason the industry gets so flustered about digital, is that they’re trying to re-calibrate for how consumer behaviour is changing.

Nearly everyone in the industry would love it if listeners just stayed listening to FM. But listeners don’t want just FM. They want more. 6Music in the car, Capital in Liverpool on DAB, to listening to their old favourite from home on their smartphone or just tuning in to their local breakfast show on FM.

If you work for a station that doesn’t really have a decent website, isn’t the market leader in radio and who’s future is seemingly only FM, ask the boss what the plan is for dealing with all this changing consumer behaviour.

Me? I’m excited about changing consumer behaviour. It means we move on, evolve, do something new. It means we can re-think things we’ve always done, it opens up new opportunities, makes us stop and think,  and above all it means what we do stays being fun.

Update: An update from Adam Bowie on today’s announcement.

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