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08 Feb

A Great Year Ahead For Radio and Audio

2016 was certainly an eventful year for the radio and audio sector, seeing much investment and growth. News Corp took over TalkSPORT owner, Wireless Group; Bauer bought the Orion network; D2 – the second national commercial radio DAB multiplex – was launched; Virgin Radio was relaunched; Global Radio has its biggest month of revenue ever in November; digital audio’s reach now exceeds 22 million adults each week with 19% of all UK app time being spent with audio apps; radio and digital both increased revenues in 2016. Yes, it was a pretty good year for our industry.

And 2017 looks set to be just as exciting.

This year more than ever, the industry is turning to research to back up claims that radio is very much alive and kicking! Here at Kalua, we are championing a number of research projects that do exactly that – research that shows how, and more importantly why, radio advertising is still so effective. (More on this to come in the coming months!)

For example, the growth of digital audio podcasts and streaming services has definitely not had the “death of radio” effect that was predicted. Far from it. Radio is still the medium with the biggest reach at breakfast time in the UK – with more than 89% off all adults tuning in each week. Recent numbers show that whilst digital audio figures are growing, this isn’t detracting from time spent with the traditional radio, but rather people listening to owned music that has declined.

And so digital audio is, in actual fact, a great new opportunity to reach consumers, especially when the interaction can be personalised. We should look at “audio” as a whole medium within a broadcast unit. We should create overall audio strategies for our clients.

The U.S. predicts that within the next two years 15% of digital budgets will be spent in digital audio. Global’s Dax is pioneering digital audio trading in many ways: signing agreements with other media owners to use their data; developing “Listener Insight ID” to track user’s “Post Listen” behaviour; synchronising traditional radio with out-of-home media to target specific locations and so on. There’s no doubt that we will see a higher proportion of media spend allocated to digital audio in 2017, but it won’t simply eat into radio budgets.

The audio business is also diversifying. Radio stations have been very successful at hosting their own live events – think Bauer’s Magic Of Christmas and the Capital Summertime Ball. Global has created a live division after buying the rights to six music festivals. Bauer is focussing on growing its radio group footprint across the UK and Europe. All three major radio groups are looking in different directions to diversify and find new revenue streams.

All in all, the year ahead is sure to be as eventful as the last!

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