Feature: National Commercial Stations Feel The Squeeze
Figures compiled by Nielsen Media Research exclusively for NewsLine suggest that the difficult market conditions and the growing number of digital radio formats is helping to drive down advertising revenue at the UK’s most established national commercial radio stations.
The data shows that Classic FM, which is the country’s most popular commercial station, with more than 6.5 million listeners, has seen ad revenue fall by almost 15% year on year in the second quarter of 2003 to just below £7.6 million. This coincides with a 1.7% decline in weekly reach during the same period.
Longer term analysis shows that Classic FM has performed strongly over the last few years and a 5.9% increase in weekly reach since the second quarter of 2000 has prompted the station’s owner, GWR, to launch a digital TV extension of the core radio and subsequent magazine brand. However, the station has been hard hit by the advertising downturn and revenue has dipped by 8.7% over last three years.
Classic FM has secured a number of high-profile sponsorship deals recently and GWR’s sales house, Opus, is hoping to further boost revenue with a new research study, which claims that Classic FM listeners respond better to advertising than their pop music counterparts (see Classic FM Listeners Respond Better To Ads).
Meanwhile, national speech-based sports radio station, talkSPORT, experienced a slight 2.7% year on year drop in advertising revenue during the second quarter of 2003 to just below £3.6 million. This comes in spite of the absence of last summer’s World Cup, which helped to attract a number of big brand sponsors to the format. However, the Wireless Group’s flagship station was less lucky in terms of weekly reach, which dipped by 10% year on year during the same period to just below 2.2 million, demonstrating the station’s reliance on high-profile sporting events to bolster its audience figures.
talkSPORT, which relaunched in its current format just over three years ago, has proven its ability to deliver advertisers to a young male audience and longer term analysis shows that weekly reach has increased by 7.5% since the second quarter of 2000. Meanwhile, revenue at the station has experienced a number of seasonal peaks and troughs, as advertisers capitalise on the coverage of major sporting events to reach their target audience. However, a number of lucrative sponsorship deals have helped talkSPORT to see ad revenue increase by almost 21% over the last three years to just under £3.6 million.
SMG’s Virgin Radio has attracted its fair share of press coverage recently after emerging triumphant in its High Court battle with star DJ, Chris Evans. However, the station has been slightly less victorious on a national level and Virgin Radio AM saw ad revenue decline by 18% year on year during the second quarter of 2002 (see SMG Triumphs Over Evans In High Court Battle). This coincides with a 13.3% year on year decline in weekly reach during the same period to just below 2.2 million and follows a series of changes to its DJ line-up earlier this year.
Longer term analysis also paints a less than rosy picture for Virgin Radio AM and a 25.8% decline in weekly reach between the second quarter of June 2000 and the same three month period this year, was accompanied by a sharp 48% decline in advertising revenue to just below £2.8 million. However, Virgin Radio AM saw its weekly reach improve in period on period analysis and the station is one of the most popular with those listening via the internet.
Virgin Radio is hoping to improve its fortunes over the coming months with a series of innovative new advertising packages, designed to bring brands closer to the station’s editorial. It is also reportedly attempting to boost its image among music fans by signing a virtual unknown to present a weekday show dedicated to breakthrough bands and cutting-edge music.
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