Wednesday, December 19, 2012

Bring It On

Yesterday, I wrote about possible upsides and downsides for today's broadcast radio in the recent Nielsen "lunch" which featured Arbitron as a main course (Hopes And Fears).

There's one aspect of the deal that doesn't worry me one bit:  Nielsen's intentions in acquiring Arbitron is to begin measuring online radio services like Pandora.

The research has already been done and it's clear that when measured on an apples to apples basis, both streaming of terrestrial and also over the air broadcast stand to gain.

The fact is that traditional "radio" (I can't wait to universally adopt the term 'audio' advertising) currently is greatly undervalued.

It's been happening in the real world for three years now in Canada with BBM using PPM to measure radio and television usage across the same panel.  It's possible to literally follow which ad on one affects the other and of course how a combination of both broadcast media can impact branding, product adoption and make cash registers ring.

James Cridland is a British radio futurologist and has become expert in the real world as well, consulting, writing and speaking about what happens when radio and new platforms collide.

He was a on air talent at local stations, digital media director at Virgin Radio in the UK (now Absolute Radio) and helped the BBC to develop the iPlayer. Cridland operates the website Media UK, works with The Radio Academy, is involved in RadioDNS and a co-organizer of the conference.  I love the way he puts it:  "Radio needs one voice." (click to read his recommendations for radio to make the most of their online presence)

An October 2012 EMarketer study on the growth of mobile found that broadcast radio has a 13.2 percent share of time spent wih all media per day, with a 9.3 percent of the U.S. ad share. 

It's a sad statement that our sellers have not been able to justify increasing radio's rates by the 30% the current audience rating shares affirm that we earn.

Perhaps when buyers see radio's online and over the air usage stats on the same page with all media based on the identical sample, we'll finally get the price we deserve.

If Nielsen's vision for Arbitron can help us do that, they are going to find radio managers and owners asking them "what are you waiting for?  How soon can we start?"


Eric Rhoads said...

It is in Nielsen's best interest, as it was in Arbitron's, to keep radio thriving and healthy. (Some would argue that radio doesn't need Arbitron, but I'll not address that today.) At our Forecast conference last month, it was revealed that radio has a serious credibility problem in the agency community, based on two primary issues: 1) the lack of evidence that radio actually works and 2) the belief that radio is no longer relevant in a digital world.

Nielsen has the brand strength and credibility to conduct an in-depth study of radio's viability as an industry -- something I wrote about a couple of weeks ago. Radio needs to invest in proving our ability to drive business, as other media has done, so firm metrics can be provided to advertisers. This is an excellent opportunity for Nielsen to help radio get to the next level.

Jeff Haley said...

When was the last time somebody said ‘I think I’m gonna spend more than a billion dollars to buy a radio company?'

Fundamentally, there was a recognition that mobile consumption of media is on the rise, and the only company who really has a mobile measurement device is Arbitron.