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International: Digital audience poorly sold, radio and papers told

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International: Digital audience poorly sold, radio and papers told

Research by Group M, the combined media planning and buying operation of WPP, argues that while commercial digital radio has been a "technical and critical" triumph, it is "not yet the commercial success it deserves to be".

Commercial digital radio commands 66% of all digital radio listening - the reverse of BBC dominance in the analogue domain - and has reached 16% of all commercial radio listening, according to the report.

However, the audience is "poorly sold at a time when commercial radio needs all the help it can get", study says.

Group M predicts that radio's share of media spend will drop from 4%, or £471m, at the close of 2005 to 3.7%, or £466m, in 2007.

"There are over 100 digital stations now and while analogue radio has lost out to the BBC over recent years, the idea has been to migrate revenue to digital," said Howard Bareham, managing partner at WPP media agency MindShare.

"In the last year or so, digital audiences have grown but, as a general rule, sales companies are not pushing the opportunities.

"In my view, they need to make sales easier by, for example, perhaps packaging stations together across different radio groups on the basis of audience type."

In terms of the newspaper market, Group M predicts that the share of media spend on national newspapers will drop from 13.4%, or £1.6bn, this year to 12.5%, or £1.5bn, in 2007; and share of media spend on regional newspapers will drop from 19.6%, or £2.36bn, to 18.1%, or about £2.2bn, in 2007.

"With some exceptions, newspaper groups don't seem to be marketing their digital assets particularly well," said Adam Smith, the futures director at Group M.

"Regional press groups, in particular, still seem to be overly focused on only selling in print.

"As with radio, the sales forces neglect their digital assets. The typical newspaper sales department still regards online as an exotic distraction, if they are aware of it at all."

However, the report praises the management decisions made in the quality sector to reposition as brands rather than titles and for "listening closest to advertisers".

This is key as the report identifies national newspapers in particular as having young readers that "migrate online sometimes at alarming speed" and are also particularly price-sensitive and likely to seek out free content online.

Paul Thomas, the investment director at Mindshare, argues that only 5% to 10% of most newspaper groups' revenue is coming from online operations and this is not good enough.

"What most newspapers haven't done and where they are trying to catch up is monetise and move audience online. They have not done enough to build web presence in the same vein as their position offline and yet the internet is much more competitive and diverse.

"There has been a failure to fill the 'web void'. Most newspaper groups have been insular and are too focused on the traditional newspaper market, not as content creators."

In terms of regional press "sorting out online", the report identifies a need to crack the "bad habit" of "expecting advertisers to buy packaged areas, while proclaiming "life is local", when advertisers want tighter geographical targeting. This applies to display and, in particular, to classified recruitment.

Furthermore, while regional newspaper groups are investing in digital, in the form of blogs, podcasts and video chat, sales teams are not making the most of opportunities and looking to cross-sell, the report stated.

Source: MediaGuardian


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