Happy birthday to commercial radio – 40 today
40 years ago today, if you lived in London and the Home Counties and you’d turned a radio on you would have had been able to listen to LBC as well. A momentous moment in radio.
On 8 October 1973 the London Broadcasting Company began broadcasting as the country’s first independent radio station. This was closely followed by Capital & Clyde.
Interestingly, Clyde 1 (the third commercial station to launch) not only still exists but has grown and remains the No.1 station in Glasgow with a market share almost 50% higher than BBC Radio 2.
From pirate stations and the boats that rocked to DAB radio and petitions to keep stations alive, it’s been a tumultuous 40 years with the medium being consistently redefined.
Here are some highlights, some successes and more importantly where Radio is headed next.
- Edward Heath’s Government setting up the Independent Broadcasting Authority (IBA) in 1972. This encouraged interested groups to apply for medium-term contracts to provide programmes in given areas.
- The broadcasting Act 1990. The Radio Authority changes to issuing licences to the highest bidder and promoting the development of commercial radio choice.
- October 1998. Begin to licence the commercial DAB multiplexes.
- Dec 2010. Ofcom announced a deregulation in Sections 9 and 10 of its Broadcast Code which related to sponsorship and commercial references. This meant clients could become embedded within a radio station’s brand and into content that shares common brand values, personality or message – delivering the highest levels of engagement.
- Feb 2012. Absolute Radio launches InStream radio, offering digital targeting for broadcast radio.
There has been a lot of negative publicity about slow uptake by consumers – http://www.theguardian.com/media/2013/sep/25/radio-listeners-resist-digital but for clients it’s exceptionally exciting with new buying opportunities offered by the likes of InStream.
This applies digital metrics to broadcast radio. It is now possible to target logged-in listeners across desktop and mobile by age, gender, location and device. This brings digital capping, minimal wastage and clickable companion ads, which will increase stand-out and engagement for advertisers.
The threat of Spotify and iTunes radio.
The growth of music streaming services has made a big impact to the music world. Worldwide Spotify now has 24m active users and 6m paying customers. This has opened up new opportunities for advertisers to serve audio advertising to bespoke target audiences (currently on a much bigger scale than InStream radio).
The visual accompanying ads create a fully engaging experience for the user. Spotify is estimated to bring in £30m in UK ad revenue compared to £550m for commercial radio, so radio is still by far the dominant audio advertising platform.
The growth of InStream radio will help commercial radio combat the growth of streaming services like Spotify. This will be tested further when iTunes radio launches in early 2014. The sheer popularity of Apple will mean that iTunes radio will be a success.
Back to basics – what is radio good for?
Radio continues to deliver high ROI to clients.
The new RAB econometrics study, constructed from the broadest ever dataset relating to media ROI, puts radio as the second best media for ROI (behind TV, aligned with Thinkbox’s recent study). This shows radio has not lost any of its effectiveness over the years.
Online multiplier effect – radio works with online behaviour.
The Online Multiplier study shows that radio is the ideal offline media to complement increased online behaviour. Exposure to radio advertising boosts brand browsing by 52%. Radio is four times more effective than other media in this respect, according to the study.
The ability of the presenters to talk to their audience on a one to one level.
And now there are more ways than ever before for a DJ to engage with its audience and redefine how we can serve ads.
This is evident in our recent work for Wickes and Absolute Radio which has seen us working closely with the Christian O’Connell Breakfast show to create bespoke segments and content, such as our recent Mr Wickes Competition.
Competing Vs other traditional media
Traditional offline media has had to adapt to ever changing viewing behaviour and new digital platforms. Their increased flexibility challenges some of radio’s previous unique strengths.
- TV & Second Screening. A simple 30” ad in X Factor can now be a fully interactive Shazam enabled experience or offering the viewer the chance to be the fifth judge playing along to the interactive options.
- Cinema is now 100% digital offering increased flexibility on day of week, dayparts and localised messaging.
- Press now has fluid offline and online opportunities making full use of the new tablet opportunities to create an engaging experience for the user.
- Outdoor is becoming increasingly digitally enabled, offering real time placement opportunities.
Going forward, radio can still be a major player, but it needs to strengthen its USPs and continue to look for new opportunities in the new digital world.
Michael Williamson, Head of Radio, Carat