Back to results Radio : Free air By Patricia Moore Think back a few weeks to the controversy that erupted around The Edge’s Hug a Ginga Day; television hosts spluttered their way through interviews and columnists devoted inches to an issue we were told was dividing the country. Meanwhile, the station involved enjoyed publicity beyond its wildest dreams. Despite the global financial crisis, radio has fared reasonably well over the past 18 months, says Martin Gillman at media consultancy MGCOM. “Radio is very resilient in terms of revenue because it’s very much a local retail medium.” That’s important in a nation of small businesses operating within a designated area, he says. NZ is a globally unique market, says The Radio Bureau gm Gill Stewart. “With a share of advertising revenue between 11% and 12% for the past 10 years, NZ radio has one of the highest share levels in the developed world.” TRB is also globally unique in that it’s the only company that represents every commercial radio station in the country. “That’s no mean feat given that the market supports over 320 licensed commercial frequencies, 80% of which are consolidated into 23 branded networks.” She says audience engagement, relevant media context, low wastage and incredibly short lead times all saw advertisers happy to stay with radio through the past 18 months. “The deep connection audiences invest in their favourite station means that radio provides the ideal media context for advertisers to build and maintain consumer trust in tough times.” There are growing signs of optimism in the marketplace, says Simon Marsh who’s made the transition from breakfast jock to running sales consultancy RadioAdvertising.Co.NZ. He says advertisers are returning to the medium after an absence – or turning to radio for the first time. “And I’ve found that generally the businesses that planned for the downturn by maintaining their advertising strategy have shown a trend toward growth in their marketshare, despite the market shrinking overall.” TRN and MediaWorks dominate NZ’s radio waves. Gillman suggests that’s led to a lack of variation, and doesn’t necessarily serve the market as well as it could. “They simply match what the other is doing. You’ve got two talk stations, two rock stations and so on.” Paul Hancox, director sales & marketing at MediaWorks disagrees. “The market is extremely competitive and the revenue advantages to the market leaders are substantial. With 40-odd stations in Auckland every format is covered so the spoils go to the best music mix, promotion, personalities and sales strategies.” Radio may have fared better than other mediums, but the past 18 months have been challenging says Rob Julian, TRN director of sales. “Clients have retrenched their spend by channel or demographic reach, and a number of categories have undertaken different strategies.” For a good many businesses, surviving the past 18 months has involved trimming fat wherever possible. Gillman notes that from a financial perspective the NZ radio business model is probably one of the most successful in the world. And given that it’s been going through a rationalisation phase for the past 10 years, the GFC doesn’t appear to have forced any further change, says TRN’s Julian. The things that will change the model are more in the area of distribution, he says. “The moving of spectrums, licences, digital media versus analogue, and also the internet as a distribution medium.” There’s been a lot of talk about digital radio but so far that’s about it. Paul Hancox of MediaWorks dismisses it as having “no history of profit anywhere. It’s a long way off.” TRN reports it’s been testing the different technology platforms and the user experience, and watching what’s happening overseas.”The thing is,” says Rob Julian, “there’s not going to be a big bang.” But if digital’s still to happen, social and online engagement has long since been embraced by radio. Online is big, says Paul Hancox. “Very big. It enables radio to connect personally with listeners, and develop databases and new revenue opportunities for advertisers. “Video online promotions and other content are a priority and I believe we are well ahead of our competitor in this area.” And Julian says radio will be successful in the online environment by engaging its audience to contribute to content in a far more interactive way that can then be leveraged with advertisers. The ability to drive customers recently saw a simple McDonald’s fan page grow from a few fans to over 13,000 in just a few days; “All it took was for The Edge hosts Fletch & Vaughan to push the page to listeners on air and online via their own Facebook page,” says TRB’s Stewart. “Arguably a radio host is in one of the best positions to integrate their role with social media,” says Julian. “They can tweet or update a social media site while they’re on air and even draw people from the social media site back into radio in real time.” Criticism of the big two radio companies ‘matching’ products may or may not be valid but there is a genuine diversity across the dial. Ethnic radio is an example, and is not niche, particularly in the Auckland market, says TRB’s Stewart. She cites Radio Tarana as an example of a station targeting a specific ethnic audience. “That’s nowhere near niche with a cume of nearly 42,000 10+ in the last survey.” Established in 1996, it’s NZ’s first Indian radio station and acts as a portal of news, views and information for the Indian community, says md Robert Khan. He stresses it’s not a community station. “Radio Tarana is a language broadcaster that competes in the mainstream.” And brand advertisers are slowly increasing. “Over 60% of our business comes from local Indian businesses but currently we’re being used by a number of brand advertisers,” Khan says. Chinese Voice is vital to the Chinese community, says ceo Samson Yau. “It’s also powerful and influential.” He says an example of this came in 2008 when, following several violent crimes in which three Asian immigrants were killed, the local Chinese community called for a demonstration. “Initially it was expected to have one or two hundred participants but by making it a talkback topic for a week on Chinese Voice, 15,000 people from all corners of Auckland flooded to the venue.” There are, of course, an increasing number of community stations – enterprises more interested in communicating with the locals than making money. “Community media are generally performing well,” says Jim Tully, University of Canterbury journalism lecturer & media commentator. “The message is that local content is what people want.” For a time, it wasn’t quite what they got in Christchurch and “a surge in local radio stations” followed NewstalkZB’s canning its Christchurch-based programmes. That local programmes have been reinstated is due only to the subsequent ratings dive, says Tully. Jacquie McVie at Maori Media Network works with 20 iwi/whanau stations and two dedicated rangatahi (youth) stations across NZ. These attract around 280,000 listeners in rural & urban areas and the community function is acknowledged as a major factor for listeners tuning in, she says. “Stations often broadcast live from local marae, hui and events, and listeners are kept up to date with what’s happening in their tribal areas.” To date Maori stations have attracted primarily government and non-retail advertising, but McVie points out that with Maori households spending close to $200 million every week – and an audience of around half of all Maori – the stations make a very attractive proposition. “It’s staggering that the medium has been largely under-utilised by agencies and retail advertisers to date.” Radio in New Zealand has achieved an admirable degree of success and consistency over the years, says Martin Gillman. But, having come through the past 18 months in reasonable shape, will commercial radio start attracting the big dollars again? The immediate challenge for the industry is winning back retrenched client spend levels, says TRN’s Julian. And will radio suffer as online adspend continues its climb? “Radio will remain key,” says Paul Hancox. “There is no sign at all that radio is not the leading media for retailers.” © Copyright AdMedia magazine June 2010 All material appearing is copyright and cannot be reproduced without prior permission of the publisher. Please contact the copyright officer: Ph 0-9-845 5114, Email copyright@mediaweb.co.nz.	Username Password Keep me logged in on this computer Forgotten your password? Enter your email address and we will email your password to you:

Radio : Free air

By Patricia Moore

Think back a few weeks to the controversy that erupted around The Edge’s Hug a Ginga Day; television hosts spluttered their way through interviews and columnists devoted inches to an issue we were told was dividing the country. Meanwhile, the station involved enjoyed publicity beyond its wildest dreams.
Despite the global financial crisis, radio has fared reasonably well over the past 18 months, says Martin Gillman at media consultancy MGCOM. “Radio is very resilient in terms of revenue because it’s very much a local retail medium.” That’s important in a nation of small businesses operating within a designated area, he says.
NZ is a globally unique market, says The Radio Bureau gm Gill Stewart. “With a share of advertising revenue between 11% and 12% for the past 10 years, NZ radio has one of the highest share levels in the developed world.”
TRB is also globally unique in that it’s the only company that represents every commercial radio station in the country. “That’s no mean feat given that the market supports over 320 licensed commercial frequencies, 80% of which are consolidated into 23 branded networks.”
She says audience engagement, relevant media context, low wastage and incredibly short lead times all saw advertisers happy to stay with radio through the past 18 months. “The deep connection audiences invest in their favourite station means that radio provides the ideal media context for advertisers to build and maintain consumer trust in tough times.”
There are growing signs of optimism in the marketplace, says Simon Marsh who’s made the transition from breakfast jock to running sales consultancy RadioAdvertising.Co.NZ. He says advertisers are returning to the medium after an absence – or turning to radio for the first time. “And I’ve found that generally the businesses that planned for the downturn by maintaining their advertising strategy have shown a trend toward growth in their marketshare, despite the market shrinking overall.”
TRN and MediaWorks dominate NZ’s radio waves. Gillman suggests that’s led to a lack of variation, and doesn’t necessarily serve the market as well as it could. “They simply match what the other is doing. You’ve got two talk stations, two rock stations and so on.”
Paul Hancox, director sales & marketing at MediaWorks disagrees. “The market is extremely competitive and the revenue advantages to the market leaders are substantial. With 40-odd stations in Auckland every format is covered so the spoils go to the best music mix, promotion, personalities and sales strategies.”
Radio may have fared better than other mediums, but the past 18 months have been challenging says Rob Julian, TRN director of sales.
“Clients have retrenched their spend by channel or demographic reach, and a number of categories have undertaken different strategies.”
For a good many businesses, surviving the past 18 months has involved trimming fat wherever possible. Gillman notes that from a financial perspective the NZ radio business model is probably one of the most successful in the world.
And given that it’s been going through a rationalisation phase for the past 10 years, the GFC doesn’t appear to have forced any further change, says TRN’s Julian. The things that will change the model are more in the area of distribution, he says. “The moving of spectrums, licences, digital media versus analogue, and also the internet as a distribution medium.”
There’s been a lot of talk about digital radio but so far that’s about it. Paul Hancox of MediaWorks dismisses it as having “no history of profit anywhere. It’s a long way off.”
TRN reports it’s been testing the different technology platforms and the user experience, and watching what’s happening overseas.”The thing is,” says Rob Julian, “there’s not going to be a big bang.”
But if digital’s still to happen, social and online engagement has long since been embraced by radio. Online is big, says Paul Hancox. “Very big. It enables radio to connect personally with listeners, and develop databases and new revenue opportunities for advertisers.
“Video online promotions and other content are a priority and I believe we are well ahead of our competitor in this area.”
And Julian says radio will be successful in the online environment by engaging its audience to contribute to content in a far more interactive way that can then be leveraged with advertisers.
The ability to drive customers recently saw a simple McDonald’s fan page grow from a few fans to over 13,000 in just a few days; “All it took was for The Edge hosts Fletch & Vaughan to push the page to listeners on air and online via their own Facebook page,” says TRB’s Stewart.
“Arguably a radio host is in one of the best positions to integrate their role with social media,” says Julian. “They can tweet or update a social media site while they’re on air and even draw people from the social media site back into radio in real time.”
Criticism of the big two radio companies ‘matching’ products may or may not be valid but there is a genuine diversity across the dial. Ethnic radio is an example, and is not niche, particularly in the Auckland market, says TRB’s Stewart.
She cites Radio Tarana as an example of a station targeting a specific ethnic audience. “That’s nowhere near niche with a cume of nearly 42,000 10+ in the last survey.”
Established in 1996, it’s NZ’s first Indian radio station and acts as a portal of news, views and information for the Indian community, says md Robert Khan.
He stresses it’s not a community station. “Radio Tarana is a language broadcaster that competes in the mainstream.” And brand advertisers are slowly increasing. “Over 60% of our business comes from local Indian businesses but currently we’re being used by a number of brand advertisers,” Khan says.
Chinese Voice is vital to the Chinese community, says ceo Samson Yau. “It’s also powerful and influential.”
He says an example of this came in 2008 when, following several violent crimes in which three Asian immigrants were killed, the local Chinese community called for a demonstration. “Initially it was expected to have one or two hundred participants but by making it a talkback topic for a week on Chinese Voice, 15,000 people from all corners of Auckland flooded to the venue.”
There are, of course, an increasing number of community stations – enterprises more interested in communicating with the locals than making money. “Community media are generally performing well,” says Jim Tully, University of Canterbury journalism lecturer & media commentator.
“The message is that local content is what people want.” For a time, it wasn’t quite what they got in Christchurch and “a surge in local radio stations” followed NewstalkZB’s canning its Christchurch-based programmes. That local programmes have been reinstated is due only to the subsequent ratings dive, says Tully.
Jacquie McVie at Maori Media Network works with 20 iwi/whanau stations and two dedicated rangatahi (youth) stations across NZ. These attract around 280,000 listeners in rural & urban areas and the community function is acknowledged as a major factor for listeners tuning in, she says.
“Stations often broadcast live from local marae, hui and events, and listeners are kept up to date with what’s happening in their tribal areas.”
To date Maori stations have attracted primarily government and non-retail advertising, but McVie points out that with Maori households spending close to $200 million every week – and an audience of around half of all Maori – the stations make a very attractive proposition.
“It’s staggering that the medium has been largely under-utilised by agencies and retail advertisers to date.”
Radio in New Zealand has achieved an admirable degree of success and consistency over the years, says Martin Gillman. But, having come through the past 18 months in reasonable shape, will commercial radio start attracting the big dollars again?
The immediate challenge for the industry is winning back retrenched client spend levels, says TRN’s Julian.
And will radio suffer as online adspend continues its climb? “Radio will remain key,” says Paul Hancox. “There is no sign at all that radio is not the leading media for retailers.”

© Copyright AdMedia magazine June 2010

All material appearing is copyright and cannot be reproduced without prior permission of the publisher.

Please contact the copyright officer: Ph 0-9-845 5114, Email copyright@mediaweb.co.nz.

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Radio : Free air