Media Forum: Can radio rise to ad challenge?

Are the ambitious targets set by the RadioCentre achievable, Alasdair Reid asks.

The honeymoon period is over. Not that Andrew Harrison, who took up his role as the chief executive of the RadioCentre back in October, has had much of a honeymoon.

Morale in the commercial radio industry has not been sky high of late. Advertising recession, a reinvigorated BBC and the bungled merger of Capital Radio and GWR stopped the medium dead in its tracks - Harrison has inherited a daunting task as he aims to get the medium moving once more.

The RadioCentre is an umbrella organisation that now oversees what were previously two distinct roles - the corporate and political lobbying functions undertaken by the Commercial Radio Companies Association on the one hand, and the marketing function of the Radio Advertising Bureau on the other. In theory, bringing the two sides together under the guidance of a single chief executive will enable the medium to fight its corner more effectively.

But the industry has been impatient to see if the reality can live up to expectations. So, last week's speech, delivered by Harrison at the inaugural RadioActive conference, lays down some important markers. In particular, he set two ambitious targets. First, revenues: over the next three years, he would like to see the medium's share of display ad revenue rise from 6.1 per cent to 7 per cent. In absolute terms, that will probably mean leaping from £600 million to more than £700 million. The driver, he argues, will be audience - and here, he says, history is on radio's side.

When people access the medium via digital platforms, commercial audience share is higher than is achieved through analogue reception. Furthermore, radio is the only medium that dovetails with internet usage. After all, you can't watch TV or read newspapers while you're surfing. So, here's target number two: achieve audience parity with the BBC as soon as possible.

Should the advertising industry be encouraged by what it heard? Are these the right, and achievable, targets?

Jeremy Found, COI's head of media, implies that the actual targets aren't the real issue here - the important thing is for the medium to start moving in the right direction. He explains: "It's a question of degree. I'm sure digital will be a contributory factor as regards audience share, but it is dependent on programming, too. The revenue target is also challenging, but if the commercial radio industry can get everything else right, it can certainly expect to raise its share of advertising revenue, even in a highly competitive and increasingly fragmented media market."

But Erica Taylor, the group buying director at radio's biggest buying point, Starcom, says she's not wholly convinced. She adds: "Digital is important, but I'm not sure about the notion that commercial audience share will grow because older generations will die off. The BBC isn't stupid - so I don't think you can take anything like that for granted. You can't assume that, because a certain age group has grown up with commercial radio, it will stick with it. You have to keep your audience by giving them good programming."

Al Young, the executive creative director of St Luke's, is a former chairman of the Aerial Awards and is a passionate advocate for raising creative standards in the medium. Shouldn't Harrison's speech have at least touched on that topic? Perhaps, Young responds - but Harrison is right to talk about infrastructure issues, too. He says: "I believe radio has an exciting future. From a listener's point of view, radio is a medium you can listen to while you are out and about. And it's the one medium that really works with online - and that is important because people are spending increasing amounts of time online. It's a great companion medium. It's true though, that in that particular context, programming and advertising quality is more important than ever. Without engagement, radio becomes ever easier to ignore."

True, Howard Bareham, a managing partner at MindShare, agrees. But he argues radio has to start making urgent headway where audiences are concerned. He says: "I do buy into the notion that digital will help the commercial sector. The problem here, on the other hand, is getting people to migrate to digital in the first place. Hardly anyone listens to digital radio in their cars, for instance. The equipment just hasn't been fitted. And even if the audience numbers do start moving in the right way, that's still no guarantee that the advertising revenue will follow."

YES - Jeremy Found, head of media, COI

"These are quite challenging targets, but that is not in itself an issue. Radio has been through a period where it has been looking inwards. Now it has to be more outward-facing, and it's encouraging to see it re-engaging with its audience."

MAYBE - Erica Taylor, group buying director, Starcom

"Younger planner buyers now have a negative perception of radio - how it's losing listeners and the audience measurement system is inadequate. Just remaking the case for radio as an advertising medium is not going to do the trick."

YES - Al Young, executive creative director, St Luke's

"Only if the medium keeps promoting creativity as the RAB has been doing. There are other bodies doing their bit to get their own media energised. If radio neglects that aspect of things, it will feel the effects very quickly."

MAYBE - Howard Bareham, managing partner, MindShare

"In some ways, moving revenues forward by £100 million in three years doesn't sound so bad - it's only £30-odd million a year. But it's a tall order, even if audiences move in the right direction. You have to be ambitious though."

- Got a view? E-mail us at campaign@haymarket.com.

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