RAJAR REVIEW

By The Drum, Administrator

November 30, 2005 | 14 min read

With the latest RAJAR figures released last month, all eyes (or should that be ears) are currently fixed firmly on the medium and how effective it can be for advertisers.

While technology advances have affected almost all media in recent years, the advent of DAB has, arguably, had the most dramatic effect of all. However, despite overwhelming benefits of ‘going digital’, many of us are still tilting our heads towards our analogue sets.

Despite having landed, launched and provided much improvement to the medium, the digital revolution, for radio at least, appears to still be lurking around the corner.

So what’s it waiting for?

Many advertisers are continuing to err on the side of caution while others are slowly beginning to embrace it fully.

Wanting to get to the bottom of DAB, and discover the opportunities that advertisers have, Adline has briefed five media buying and planning chiefs to cast their expert eye over what’s on offer.

Sandra Knowles

Head of Radio, Brilliant Manchester

We are in the digital evolution, radio is right in the middle of this technology and you have to be in it to win it! DAB ie, the future, is here and advertisers will have a greater choice and stronger voice throughout this new era.

DAB’s strongest point is that it can appeal to the non-analogue listener, people who never really listened to the radio in the car or at home but have now found new avenues. Through TV (Freeview and Sky) there are a plethora of stations to suit every taste and with the ease of use and accessibility this audience is growing. Home internet through broadband – this is an ideal accompaniment whereby listeners tune into their favourite radio station through their PC. It can also help to increase the advertisers potential market by appealing to the youth market who can listen whilst they are doing their homework, surfing or chat-rooming.

DAB has helped advertisers become a bigger part of the listeners’ day, it is now a medium that they can take with them whilst carrying out their day-to-day lives. This has been helped by technology enabling people to tune in through their mobile phones. Advertisers who are clever enough can target their listeners by daypart and also in some cases at the point of purchase, giving their messages greater intensity.

Breakfast is still the most popular time for advertisers to reach their potential audience but weekday, daytime and evening have both shown considerable growth via the DAB platforms, which will allow advertisers to take advantage of this less expensive airtime, and ultimately give a more balanced schedule and reach a wider variety of listeners.

There are now radio stations in areas where they have no analogue signal but with DAB they have radio brands and existing analogue areas have more choice ie., Heart FM in the Northwest and Galaxy in London. These stations have recently started to sell digital platforms to advertisers on a network basis while keeping news and traffic elements local.

Sound quality, although important to the listener, is very important to advertisers with messages through DAB much clearer and becoming stronger. When ads are placed within a high quality environment listeners become far more receptive to the messages offering a better call to action.

The future for Digital radio will become more creative for advertisers as it will eventually allow visual display of the clients logo on their stereo as their ad is played giving reinforcement to the messages heard. Digital radio can also exploit the same ‘red button technology’ as Digital TV allowing advertisers to run competitions and offers supporting on air promotions. This will further enhance the commercial offering. As technology advances it will also be possible to pause and rewind live radio and eventually advertisers will be able to target specific messages and products to individual listeners’ tastes, needs and wants – very Big Brother!

Alison Black

Account Director, Feather Brooksbank

What digital radio can offer to advertisers...

To look at what digital radio can do for the advertiser we need to look at the overall picture. Consumer uptake of DAB digital radio sets has been fast, doubling every year since 2002 and the Digital Radio Development Bureau (DRDB) has predicted that by the end of 2009, 40 per cent of households will have a digital radio. It is estimated when people buy a digital set that their listening goes up by almost a fifth. Falling costs of digital radio sets will be a main driver of uptake amongst consumers and sets are now available for under £40. Disappointingly, car manufacturers have been fairly slow on the uptake with newer technologies such as MP3 players making an in-car impact. However, iPods don’t give you news, new songs and local information. So what does digital radio offer the advertiser?

Where, when and who – digital radio has created more situations and occasions where and when people can listen to radio and has also opened up radio to new audiences. Internet radio is listened to in the office, traditionally a difficult environment to reach, and as broadband becomes more popular an increase in listening at home can be expected with children surfing the internet or doing homework on their PC. Over 63 per cent of homes in the UK have digital television giving access to digital radio and we are seeing younger audiences tuning in to radio via their TV in their bedrooms. Sets are now being introduced that include features more attractive to younger audiences – such as pause, rewind and record functionality and the new Sky Gnome allows the user to listen to the radio, via their Sky box anywhere in the house.

Choice – digital radio provides listeners and advertisers with huge increases in choice:

* There are 421 DAB Services (227 of which are DAB only) vs 281 analogue services.

* There are 166 brands on digital radio (35 of which are digital-only) 123 of these are commercial radio brands vs 43 BBC radio brands.

Data opportunities for advertisers – on a DAB Digital Radio LCD display an advertiser could currently run a phone number or web address. There is scope for far more imaginative use of data broadcasting and the integration of DAB Digital Radio into mobile phones could prove integral in this area with opportunities for advertisers to use video clips. Radio can also exploit the same ‘red button technology’ that Digital TV uses offering a visual support to radio programmes. This gives users access to competitions/offers/ring tones by pressing the relevant coloured buttons. Internet radio probably provides the most scope for creativity when it comes to adding an extra dimension to spot advertising. Competitions and other promotional dynamics can be run on the station website. This can be particularly powerful in support of sponsorship and promotional deals.

So what does the future hold? The digital operators really need to get behind the services they offer and do some hard selling, not only to the consumer but also to potential advertisers and invest in good programming. There is no doubt that digital radio offers potential opportunities for advertisers to reach existing and new audiences, working in partnership with the digital operators to maximise campaigns using the new data opportunities and technologies.

Nola Astle

Head of Radio, Mediaedge:cia Manchester

Despite digital radio being around for more than five years I still believe it is a missed opportunity for broadcasters. Firstly three key radio facts:

1. It is estimated that there are between 110 million and 150 million radio sets in the UK

2. Current figures show that there are over 1.8 million digital radios in the UK giving a household penetration of c.8 per cent

3. The latest Rajar figures show that the BBC takes 54.5 per cent share of total radio listening while commercial radio falls behind with only 43.4 per cent – in fact commercial radio share dropped from 46.6 per cent for the same period in 2000

In truth, the advent of digital radio has not had a huge effect on all radio listening. The total number of listening hours in September 2001 was 1,092 million, for the same period in 2005 that figure had decreased slightly to 1,071 million. We have also seen a decline in the total number of commercial listening hours for the same period (September 2001 507 million, September 2005 466 million). Therefore all that is happening is that stations are cannibalising their own market with the launch of new stations and making it more difficult for advertisers to reach large audiences.

The physical planning and buying of digital radio is confusing and complex. Each group has its own sales policy – these sometimes differ from station to station. Copy splits can be difficult to navigate especially when dealing with regionalised copy. Promotional mechanics on digital only stations are limited; in many cases digital stations can’t provide the same level of interaction and flexibility as their analogue counterparts. In short, many of the digital initiatives we were promised six years ago are still not present today.

That said, there have been some great success stories with digital commercial stations. Kerrang! digital delivered, on its first Rajar, an impressive weekly adult reach of 771,000 and the success of this station must have played a part when awarding Emap with the analogue license in the West Midlands.

There are opportunities for growth within the digital market.

* Radio groups have to focus on digital brands and stop fighting with the BBC on peripheral issues – revealing programming budgets.

* Partnerships need to be formed with other media owners for promotion of digital radio. Emap have made a good start with cross promotion via different media platforms – Kerrang!, Q, Mojo etc... but GCap have forged no notable alliances.

Efforts should be focused on convincing the car manufactures to fit digital radios as standard in fleet cars making digital brands more accessible.

Paul Bramwell, Universal McCann

Does Digital Audio Broadcasting (DAB) occupy a major place in the current media market? Well no, not really. It will however have a major role to play one day and judging by recently released figures, that day may be approaching faster than some of us thought.

According to Rajar 10.5 per cent of UK adults now own a DAB receiver, up from 4.5 per cent the year before. While this represents massive growth DAB sets still only account for 2.5 million of the estimated 100 million radios in the UK, although the Digital Radio Development Bureau believes that there will be 20 million sets in existence by 2009.

The growth is fuelled by improved clarity of reception and increased station choice but DAB sets themselves offer little in the way of excitement to advertisers. What is likely to get the interest of planners is the change the digital radio stations bring to the way radio is delivered and received. Over a third of the population listen to radio through their TV, almost 20 per cent listen online and a growing number through mobile devices such as mobile phones or integrated MP3 players.

Indeed it is this ability to penetrate the mobile market that holds the key for the industry in capturing elusive but highly valuable targets such as youth and business audiences. More active and transient than other target groups, they are less likely to find use for the static DAB sets that have dominated the early market growth. If the industry can come up with something as sexy as the iPod or integrate receivers into them then they will surely crack this market.

In terms of reaching the high mileage business market in-car availability is key. This year only 15,000 cars will have digital radios fitted although as prices fall and manufacturers start fitting as standard this figure is estimated to grow to 702,000 by 2009. Parallel growth patterns in home broadband and 3G enabled mobile devices will also increase online consumption.

One side effect of these multiple formats of delivery will be a change in the type of stations we listen to. It is likely to turn a largely local commercial radio sector into a more national one. Currently only three national commercial analogue stations exist (Classic, Virgin and Talksport) and two of these are AM services. The commercial market has always been dominated by local or regional stations competing for audiences with national BBC stations. This pattern is now changing. For example online listening growth is biased to the national networks with 13.5 per cent of listeners accessing a national station. This compares with just over 5 per cent listening to a local station in their area, almost identical to the percentage of people listening to a station outside their area (other UK regions and overseas). Ofcom have just announced plans for a new national digital multiplex which should provide an extra eight national stations, possibly accelerating the move to listening based on affinity rather than just geographical convenience.

Claire Garner

Head of Radio, Mediacom North

Is DAB having a significant effect on radio advertising opportunities? Not yet. Will it? Definitely. When? Within pretty much the same timeframe as any relatively new media format reaches its tipping point from innovation to mainstream. Or to put it another way, when there are enough DAB listeners to merit a decent weight campaign, and when the technology moves onto the next stage of genuine interactivity.

Right now, the main changes in radio opportunities resulting from DAB have been the extended choice of stations in the national marketplace and the increase of genuine radio brands across the regions. Strong national brands such as Kiss and XFM, which have only previously been available in London, are now accessible on either a national platform or in major conurbations. So targeting more niche audiences nationally is now a realistic option – previously, the only options were Virgin or Classic.

Current DAB-only stations, such as QFM, offer advertisers an upmarket, well-defined audience. They also seem to offer a less cluttered environment than is the case in analogue radio. Certainly, they seem to be conscious that the average DAB listener may be significantly more discerning than their analogue equivalent, and considerably less receptive to excessive commercial minutage. The low brand count provides advertisers with the opportunity to stand out a little more – and to be associated with this relatively cutting edge media. But the numbers aren’t big yet. So right now, DAB is a bit like a cappuccino machine – stylish, modern, nice to have around, but by no means essential.

By my reckoning, the main change to advertising will come as the technology develops further. Visual streaming (the ability to use the screen to show much more than text) has yet to really materialise but when it does, it’ll provide great opportunities to advertisers who particularly require a visual campaign element.

But whilst pictures are always nice – radio traditionally sells itself as ‘pictures for the mind’ – interactivity rules, and this is where DAB can really make progress. Hopefully, some form of red-button killer application is in the offing. I’m sure that the commercial heads of the various radio groups are looking at how they sell music online (“I like that track and I want to buy it – now”), but that’s no use to advertisers. What they want is to be able to communicate more closely with listeners – and if those listeners can register their interest quickly and easily (“press the red button for a voucher / brochure etc”), then the format will be embraced much more readily.

It feels as if we’re waiting for the digital revolution to explode within radio. The numbers behind the stations aren’t big enough yet to be impressive to clients, and there isn’t enough research or case studies being put together behind successful campaigns. But we’ve been here before with other media, and DAB radio will be powerful enough within the scheme of things to become an important advertising tool.

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