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Audio Now

Audio Now

Welcome to the Audio Now microsite. Audio Now is the Radiocentre’s latest research project which takes a look at how the audio market is changing and offers some perspective on the role played by different audio services in people’s lives today. As well as detailing all the findings and subsequent implications for advertisers, you can watch participant videos and download a copy of the full report and supporting presentation slides.
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1. THERE IS MORE LISTENING THAN EVER BEFORE

Overall audio listening is growing
Total audio hours listened in a week




Source: RAJAR MIDASplus

Alongside the developments in technology, a new form of audio has emerged. The two traditional forms of audio are:

  • “owned” content which people have purchased (or pirated) and keep for themselves
  • “live radio” consumed in real time as transmitted

These have now been joined by a third source:

  • “on-demand” audio which people access online e.g.
    • radio station content (non-live) such as podcasts or catch-up radio music
    • music streaming services like Spotify and Deezer
    • online audio/video clip services like YouTube

Within this, broadcast radio listening has remained more robust than media and music industry forums might suggest – an apparent instance of Amara’s Law, where we overestimate the effect of new technology in the short term (a similar misperception has applied in recent years to broadcast TV).

Around 90% of the UK population tune in to radio each week and, as the chart shows, this has been pretty stable over recent years, even for 15-24 year-olds who tend to be the biggest users of the new audio platforms.

Radio reach remains stable


Source: RAJAR MIDASplus

2. Modern lifestyles drive the need for audio

People use audio to help them cope with life. The Sound Research idenfified six different need-states where audio played a role. For a deeper explanation select one from the grid below.

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LIFE IS NOISY AND COMPLICATED

- Audio provides a sanctuary from the outside world
- Blocks out external noise
- Me Time
- Helping to recharge

“I’m feeling stressed after the drive home and need to chill out a bit. I’m going to lie down here, listen to some music and have some quiet time”
Phil, Newcastle

Role for audio

- Reflect my moods/emotions
- Avoid interructions
- Surrounding me in my space
- "Digging" can be relaxing

Primary audio
format

On-demand

Also used
Live Radio

I NEED ENCOURAGEMENT AND SUPPORT

- Fuel to keep going
- Audio accompanies an activity providing support
- Audio is also a ‘pick me up’
- Combating loneliness

“We’ve all had our dinner, and the children are in bed. I’m listening to Kiss FM while I tidy up. It’s quite a boring job so I need something that keeps me going”
Marie, Bristol

Role for audio

- Be a friend, keep me company
- Reliable accompaniment
- Give me energy
- Help me focus

Primary audio
format

Live Radio

Also used
On-Demand

BE PRESENT IN THE OCCASION

- Brings people together
- Physically and emotionally
- Setting the tone
- Audio adds to the moment, memorability

“I’m sitting in the garden with my mum, it’s a nice day, so we’re going to listen to some summery music on my iPod and chill”
Daniel, Newcastle

Role for audio

- Create ambience for a place
- Match music to the occasion
- Avoid interruptions, focus on people
- Enhance the moment

Primary audio
format

On-demand

Also used
Live Radio

GIVES US SOMETHING TO TALK ABOUT

- Allows listeners to connect with others
- Sparks conversations
- Know what’s current
- Audio allows listeners to stay relevant

“Whatever they talk about on the breakfast show gets us chatting in the office - stuff like ‘you know you’re old when...’”
Katie, Newcastle

Role for audio

- Tell me something new, surprising
- Chat, gossip stories shared
- Feed me bits of info effortlessly
- Help me keep up with latest

Primary audio
format

Live Radio

Also used
On-demand

SO - SURPRISE ME

- Audio arrives unexpectedly
- Serendipitous moments can link to more
- It can also inspire a journey
- Allows listeners to keep it fresh and interesting

“You sometimes get bored of your own music. It’s great when you hear a new track that you would never think to play!”
Rachel, Newcastle

Role for audio

- Serendipity; the unexpected
- Unpredictable choice of others
- Links to new, unknown music
- Let me find more, explore

Primary audio
format

Live Radio

Also used
On-demand

IT’S EASY TO LOSE TOUCH

- Audio plugs listeners into the wider world
- Stay aware and feeling informed
- In touch with reality
- Audio allows listeners to multitask

“I really wanted to listen to a conversation this morning (on the radio). There’s a few things on the news I want to catch up on”
Ben, London

Role for audio

- Want to stay plugged-in to life
- Keep up with the wider world
- Effortless fit with routine
- Reassurance of connectedness

Primary audio
format

Live Radio

3. LIVE RADIO AND ON-DEMAND AUDIO PLAY COMPLEMENTARY ROLES

Broadly, listeners perceive that there are two types of audio source – live radio (which can be listened to on many devices) and on-demand, which is available from several different services and on multipleplatforms.

The different characteristics of live radio and on-demand audio mean that they are suited to different need-states (in reality, people can use any audio – or none – in a given need-state, but these are the typical patterns).

Live radio and on-demand audio play complementary roles


Source: The Sound Research

The need-states where on-demand audio has the best fit are those where the listener wants to feel in control of what is being played; for example in the Amplify The Moment need-state, where people sometimes want to create just the right atmosphere in a shared space.

By contrast, live radio shows a better fit when people are looking for a bit of external input, for example in the Lift My Mood need-state, when people are often happy to let the radio station do the choosing and mixing.

Live radio fulfils more need-states


Source: The Sound Research

Some need-states are much more prevalent than others. Although the qualitative sample did not allow a precise measurement of this, there were over 800 listening “moments” captured in the study, and the researchers concluded that one need-state is significantly more common than others – Lift My Mood.

This tends to be the mood we are in during routine chores and at work, where our tasks are set for us, and we look for something to help us make time move along faster, lift our spirits and ward off boredom and loneliness.

The same analysis amongst the 15-24 segment showed that they have slightly different mixture of need-states. Although they too major on Lift My Mood, they are also equally inclined to be in two other need-states – Help Me Escape, and Amplify The Moment.

Live radio and on-demand audio play complementary roles


Source: The Sound Research

Why? Certainly younger people are more adept with technology on the whole, but this is less about devices and more to do with attitude. A generous interpretation would be that young people are being creative, exploring and following their dreams. A more pragmatic explanation would be that, although older people would like to escape and spend time matching music to moments, they simply don’t have the time to indulge themselves in this way – and many young people do.

By the same logic, it seems likely that young people'€™s tendency to be in these two need-state 'Help Me Escape and Amplify The Moment'€“ will diminish as they get older and enter the world of work and day-to-day family life.

4. RADIO REMAINS THE DOMINANT COMMERCIAL AUDIO FORMAT,EVEN FOR YOUNGER AUDIENCES

But what does this mean for the advertiser, who is mainly interested in platforms which offer commercial messaging?

In this respect, live commercial radio still dominates listening hours. If we exclude audio sources where there is no advertising (e.g. BBC, owned content and subscribers who pay to avoid advertising on music streaming services), commercial radio accounts for around 90%of the hours people spend listening to audio – and even amongst 15-24s it still accounts for 71% of listening time.

Note: this is live radio only – podcasts and other time-shifted radio consumption are included in On-Demand Audio.

Radio dominates commercial pure play audio services


Source: RAJAR MIDASplus;Wave 4, Spring 2014

So if live radio is still the dominant medium in terms of advertising potential, what does this mean for advertisers who want to use audio effectively?

5. AUDIO CAN PLAY AN IMPORTANT ROLE IN ADVERTISING EFFECTIVENESS

A synopsis of the analysis conducted by Les Binet, Head of Effectiveness at adam&eveDDB and co-author of the IPA'€™s report on effective advertising '€œThe Long and the Short of t'€.

In a world where the supply and consumption of audio are both increasing, it makes sense to look again at the way audio works for advertisers in terms of effectiveness. We already have a mass of data in the world-leading IPA Databank about ad campaigns using audio (mostly in the form of radio), and we are able to draw some conclusions.

To recap briefly, we know that brands which use advertising successfully in the long-term balance two types of activity:

  • “activation” – designed to create an immediate response, using a rational message and building short-term business
  • “brand-building” – longer-term communication which changes feelings about a brand, working at the emotional level, with a cumulative effect over time

Where does audio fit in to that?

i. Audio for activation: the radio heartland

The short-term, sales-response model of audio advertising is fundamentally the way local advertisers use radio, and is based on its obvious strengths:

  • it’s highly targeted, by region and by age group
  • it offers short lead-times and relatively low cost
  • it’s consumed in real time, often at relevant moments across the day (cooking, travelling)

People also spend many hours listening to commercial radio each week (13 hours on average), and this ensures a high number of impacts for the advertiser'€™s messages.

But what about the longer term?

ii. Audio for brand-building: the radio higher ground

We know from the IPA Databank that successful, long-term, brand-building campaigns need to do three things: reach a wide audience, make an emotional connection and create fame. Can audio do these?

As far as reach is concerned – the weekly audience for commercial radio is 34 million people, or 64% of the adult population. It means that audio is already one of the truly mass channels, and this is set to increase with the availability of new audio platforms which, as MIDASplus data shows appeal to an audience which has low overlap with the existing radio listenership.

Audio can also clearly create an emotional response. Music is inherently emotional and radio stations are often talking on-air about topics in a way that triggers an emotional response: hence people phoning in with their very personal contributions – be that a strong view about a topic, or a dedication for a piece of music.

A SPECIAL NOTE ABOUT THE POWER OF MUSIC

Radio undoubtedly gets a lot of its emotional power from music, and this would apply to wider forms of audio too. Music has a unique ability to influence our emotions and change the way we perceive and interpret things.

Surprisingly, there has been relatively little research into the effects of music in advertising. [Out of 48,000 articles on the WARC database, only 29 look at music in any detail.] But what work has been done suggests that music can make a big difference.

Music increases attention to advertising and makes people more likely to recall the ad, the brand and the message. Music increases intent to purchase and can increase actual sales effects by 10%-30%.And, given that music is one of the main reasons why people listen to radio, musical advertising can be particularly effective in this medium.

Music makes advertising work harder



Source: Binet, Mullensiefen and Edwards, Admap 2013

But can audio offer fame?

“Fame” is one of the effects which is monitored in the Databank – the extent to which people have not just heard of a brand (awareness), or feel it is front-of-mind (saliency), but have actually talked about it.

As this chart shows, the campaigns which used radio had a far stronger “fame effect” than those which did not.

Radio amplifies fame



Source: RAJAR MIDASplus;Wave 4, Spring 2014

iii. Evidence of audio’s effectiveness from the IPA Databank

Beyond “soft” measures like fame, the IPA Databank also gives us a good indication of the power of audio in terms of the bottom line – the results for marketing effectiveness

There are three analyses in particular which paint a clear picture for the role of audio – or radio, which was the audio source in all these cases:

a) sales efficiency:
When all other things are equal, a brand'€™s market share tends to follow its share of voice. This chart shows that brands which use radio have a much higher efficiency rating for converting their share of voice into share of market

Radio amplifies sales efficiency

b) ROMI (Return On Marketing Investment)
Sales efficiency directly influences the return which brands make on their marketing investment. The IPA data suggests that campaigns which include radio have a much higher financial return than those which don’t, and this is in line with previous research for the RAB conducted by Holmes & Cook in 2013. This showed that on average, advertisers get nearly £8.00 back for every £1.00 they spend on radio

Radio boosts ROMI

c) effect on profits and margins
In a sense, this is the ultimate metric for an advertiser’s marketing spend – the effect it has on profitability. Again, the data here indicates that including radio in the mix significantly increases the effect on the client’s profits and margins.

Radio amplifies advertiser's profits

iv. Audio is an underexploited opportunity

While these findings suggest that audio is a credible and powerful brand-building medium, there is one analysis which jumps out.

Radio – the primary audio medium – takes around 6% of all display advertising revenue, yet accounts for around 22% of the time people spend with media. When considered in the context of the evidence of this study, this suggests that the advertising business is underinvesting in audio advertising and missing out on the powerful influence it can exert for brands.

Again, there is a fit here with the Holmes & Cook ROI study of 2013, which identified that raising radio’s share of an advertising budget to around 20% leads to a significant rise in ROI - not for radio alone, but for the overall ad campaign.

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