Contenu connexe Plus de Grant Goddard (20) 'David Versus Goliath: UK Commercial Radio Spends An Average £27 Per Hour On Programmes; Competitor "BBC Radio 2" Spends £4,578' by Grant Goddard1. DAVID VERSUS GOLIATH: UK
COMMERCIAL RADIO SPENDS
AN AVERAGE £27 PER HOUR ON
PROGRAMMES; COMPETITOR
'BBC RADIO 2' SPENDS £4,578
by
GRANT GODDARD
www.grantgoddard.co.uk
October 2010
2. There has been an abundance of fighting talk from the commercial radio sector in the press in
recent weeks. Commercial radio seems determined to pick another fight with BBC Radios 1
and 2, two of the three most listened to radio stations in the UK.
Guardian Media Group Radio announced that “by broadcasting on National DAB, Sky,
Freeview and Freesat, Smooth Radio will provide a strong commercial alternative to BBC
Radio 2.”
Chief executive Stuart Taylor said: “We are still at war with the BBC and we still compete for
listeners tooth and nail, as we always will."
The press headlines affirmed:
“New national network makes a Smooth attack on Radio 2” (Telegraph)
“Forget Radio 2: in five years’ time, we’ll all be going Smooth” (Independent)
“Smooth Radio takes on Radio 2 in national rollout” (Marketing Week)
“Radio Two faces fight, warns new Smooth news chief” (Press Gazette)
Then, Global Radio announced that its local FM stations will be re-branded ‘Capital Radio’ in
2011. Chief executive Ashley Tabor said:
“With the launch of the Capital network, there will now be a big national commercial
brand seriously competing with Radio 1.”
The press headlines responded:
“Capital Radio will go national in bid to challenge Radio 1” (Evening Standard)
“Capital Radio set to rival BBC Radio 1 in move to broadcast nationally” (Daily Mail)
“Global to take on Radio 1 with Capital Network” (Marketing Week)
“Capital Radio to form first national commercial radio station” (ITN)
Both the GMG and Global Radio statements achieved the intended sabre-rattling headlines in
the press though, for me, these sentiments are remarkably hollow. This ongoing phoney war
between the BBC and commercial radio is like a war between a one-eyed giant and an over-
exuberant mobile phone salesman. The giant will win every time.
Commercial radio can huff and puff all it wants, but the BBC knows it is perfectly safe in its
house built from Licence Fees. It can afford to chuckle loudly at every challenge like this
lobbed at it by commercial radio. Why?
average content costs by radio stations (£ per hour
output 2008/9)
27
434 594 742 786
1,192 1,255
1,698
3,658
4,554 4,578
6,004
9,120
0
2,500
5,000
7,500
10,000
commercial
radio
BBClocal
radio
Radio7
6Music
1Xtra
Asian
Network
ALLBBC
RADIO
BBC
Nations
Radio1
Radio3
Radio2
Radio5Live
+Extra
Radio4
Firstly, you could only ever hope to seriously compete with the existing formats of BBC
Network radio stations if you had access to their same abundance of resources. This is
something that Channel 4 belatedly realised after having promised for two years that it would
David Versus Goliath: UK Commercial Radio Spends An Average £27 Per Hour On Programmes; Competitor 'BBC
Radio 2' Spends £4,578 page 2
©2010 Grant Goddard
3. invent a new commercial radio station to compete with BBC Radio 4. Then it scrapped its radio
plans altogether.
The huge gulf between the funding of commercial radio content and BBC Network Radio
content makes direct competition simply pointless. In a recent report for the BBC Trust, I noted
that commercial radio spends an average £27 per hour on its content, while BBC Radio
spends an average £1,255 per hour. There is no way that commercial radio can make
programmes that will sound like Radio 2 on a budget that is 170th of the latter’s £4,578 per
hour.
Secondly, what sort of message do these press headlines send to consumers? To me, they
say ‘we realise that Radios 1 and 2 are fantastically successful, so we want a slice of their
action’. Or maybe even ‘you really like Radios 1 and 2, don’t you? Try us, because we want to
be just like them.’ So where is the Unique Selling Point [USP] for your own product? Don’t you
have enough faith in it to tell us why it is so good, rather than comparing it to your much
bigger, much more successful rival? Or is this the Dannii Minogue method of marketing?
I had always been taught that the cardinal sin of radio was to mention your competitors to your
audience. Every reference to your competitor tells the audience how much you respect them
and their success. Ignore them! Pretend your competitor does not even exist! Plough your own
furrow and concentrate on making a radio station that is genuinely unique. Then you will create
a brand that has a genuine USP, rather than being merely a pale imitation of Radio 1 or 2
without their big budgets. ‘I can’t believe it’s not Radio 2’ is not a tagline to which to aspire.
Thirdly, neither Capital Radio nor Smooth will be genuinely ‘national’ stations, as in capable of
being received on an analogue FM/AM radio from one end of the country to the other. So why
pretend to consumers and advertisers that they are ‘national’? In the case of Capital, its
proposed FM network presently covers 57% of the UK adult population. In the case of Smooth,
RAJAR tells us that DAB receiver penetration is presently 35%. Just how little of the UK
population can you cover and yet still describe yourself as ‘national’?
share
no. adults % adults % nationally
BBC Radio 1 11,810,000 23 9.3
Capital Radio* 5,973,000 12 3.8
BBC Radio 2 13,729,000 27 15.9
Smooth Radio 2,801,000 5 2.1
* = FM stations to be rebranded 'Capital Radio'
weekly reach (15+)
RADIO LISTENING: Q2 2010
Fourthly, don’t keep looking at Radio 1 and 2’s huge audience figures and dreaming of how
much money you could make if only you could monetise their listenership. Part of the reason
older listeners probably like Radio 2 is because there are no advertisements. Accept the fact
that Radios 1 and 2 together account for a quarter of all radio listening in the UK. Compared to
those mammoths of radio, both Capital and Smooth are mere termites. Live with that fact and,
instead, seek out commercial clients who are not merely frustrated because they cannot
advertise on BBC Radio, but who actively want to use your radio station because your
audience is intrinsically valuable to them.
Finally, invest the time and money to develop your own on-air talent rather than simply
hanging on the coattails of others’ successes. Whatever his next gig might be, Chris Moyles
will forever be remembered as ‘the saviour of Radio 1’, just as Chris Evans will always be
remembered for his Radio 1 breakfast show, not for his subsequent time at Virgin Radio. Find
new people who are good at radio and put your faith in them. Why does Smooth’s schedule
have to resemble Frankenstein’s monster, stitched together with a bit here from Radio 1 in the
80s, and a bit there from Radio 2 last month?
David Versus Goliath: UK Commercial Radio Spends An Average £27 Per Hour On Programmes; Competitor 'BBC
Radio 2' Spends £4,578 page 3
©2010 Grant Goddard
4. David Versus Goliath: UK Commercial Radio Spends An Average £27 Per Hour On Programmes; Competitor 'BBC
Radio 2' Spends £4,578 page 4
©2010 Grant Goddard
What your radio station should be doing is not competing with Radio This or Radio That for
listeners, but competing directly for consumers to spend time with you because you are ‘you’.
Radio is not like selling soap powder or yoghurt pots, where your business model can be built
upon undercutting the price of a competitor’s product, however low-quality your own cheapo
version might be. There is no price of admission in radio. Your content needs to be ‘different’
rather than ‘the same’ and it needs to create its own unique place in the market.
You should not think of your market competitors as radio stations, but as each and every
opportunity a consumer is presented with to pass their leisure time. A winning station must be
able to convince a consumer to listen to it, rather than watch television, read a book or simply
sit in silence. Because radio is ‘free’, the competition for radio is everything else that is also
free to consumers at the point-of-use.
To offer a practical example, when I worked on the launch of India’s first commercial radio
network, Radio City, the advertising agency produced an excellent marketing campaign that
extolled the virtues of the station over other radio stations. But the campaign had to be
rejected and the agency briefed in more detail. Why? Because we were launching the very first
radio station on the FM dial in a city such as Bangalore, so the overriding challenge was to
persuade people to use ‘radio’ at all, or to persuade people to buy an FM radio for the first
time, or to persuade people to switch off their television and turn to radio instead.
This philosophy seems to be a million miles away from the current UK commercial radio
strategy which seems to focus on berating BBC radio for being too successful, whilst wanting
to somehow achieve part of that success through osmosis. If only half this war effort was put
into developing policies to make the commercial sector’s stations successful on their own
account, the BBC would soon cease to matter.
Instead, RadioCentre is now demanding that commercial radio be allowed to re-broadcast old
Proms concerts recorded by BBC Radio 3. But how many of our 300 commercial radio stations
play classical music? One. And which Proms concert do you recall that would fit into Classic
FM’s playlist of short musical extracts? What next? Will Capital FM be asking the BBC for the
rights to re-broadcast some old Zoe Ball Radio 1 breakfast shows?
In September 2010, the government’s Consumer Expert Group criticised RadioCentre for
having proposed a policy for the BBC’s Strategy Review that, it felt, would have “bullied”
listeners.
Trying to bully listeners? Trying to bully the BBC? This is the war of the playground, not of a
mature media industry that has a strategy of its own making, a plan, a roadmap for its future
success. “It’s not fair. Your willy is bigger than mine.” No, it probably isn’t fair, but life deals you
a hand, you have to stop whining, get on with it and make the best of what you’ve got.
Just accept this reality: commercial radio’s willy is never going to be as big as the BBC’s. So
competing directly on size alone is a complete waste of time when, instead, you should be
developing your own individual ‘technique’.
[First published by Grant Goddard: Radio Blog as 'David Vs Goliath: Commercial Radio Spends £27 Per Hour On
Programmes, BBC Radio 2 Spends £4,578', 12 October 2010.]
Grant Goddard is a media analyst / radio specialist / radio consultant with thirty years of
experience in the broadcasting industry, having held senior management and consultancy
roles within the commercial media sector in the United Kingdom, Europe and Asia. Details at
http://www.grantgoddard.co.uk