12-19-2012
Nielsen?s move to acquire Arbitron confirms three undeniable truths about the radio industry: brands know that radio?s audience is vital to their business; radio is woven deep into the fabric of local marketing; and radio is a great complement to the broader media marketing mix.
By buying Arbitron, radio?s preeminent measurement engine across the United States, Nielsen has accomplished a number of things. First and foremost, it expresses a huge vote of confidence in the radio industry, which is still pervasive and relevant even in the face of an evolving media landscape. Arbitron?s own metrics show that more than 241 million people in the United States listen to the radio each week, which is about 92 percent of the population. That?s more than the population of England, France and Germany combined!
Further, the move validates radio?s scale and substantiates its power as a local medium. With radio?s airwaves reaching into communities all across the country, radio?s power as a local activation engine is unmatched. This deal is an unqualified endorsement of the growth prospects for radio, and the assumption that radio will continue to be a part of the media mix, even as it evolves.
The deal also signals that media consumption habits are increasingly mobile - radio?s birthright. Radio was the original mobile device, going back to the transistor and then the Walkman. Now, with radio on smartphones and tablets - it?s as ubiquitous as ever. Radio will continue to do well in this environment because it is inherently portable. And, should Nielsen adopt Arbitron?s Portable People Meter (PPM), the unique audience measurement system that tracks what consumers listen to on the radio by detecting ID codes embedded in the audio, radio will continue to benefit.
According to the Mobile Marketing Association?s 2012 TargetSpot Digital Audio Benchmark and Trend Study, internet radio listenership has reached 42 percent of adult US broadband households, an increase of 8 percent versus 2011. Connected devices such as tablets and smartphones are leading to increased listening with an 87 percent year over year increase in tablet ownership, and a 22 percent jump in ownership of smartphones among Internet Radio listeners. Consumers are spending more time listening across multiple devices compared to last year, according to the report, with 48 percent of digital audio listeners spending more time listening on their tablets, 44 percent on computers and 38 percent on mobile phones.
Also good news for radio will be the added resources applied to measurement. This extra muscle will continue to reveal our power as a marketing tool, especially on a local level. By providing accurate, up-to-the minute measurement and analytics, brands can have confidence in their buys, trusting that radio will perform, driving listeners, i.e. consumers to act.
All that said, it?s worth noting, that without meaningful competition in the marketplace, Nielsen?s influence on pricing and research methodologies may be outsized. Radio broadcasters will be at its mercy, forced to accept its results positive or negative. But, because its role as the media industry?s preeminent media measurement tool will be assured, as new media emerge, social or otherwise, Nielsen will be well positioned to deliver cross platform analysis that surely will affirm radio as a mandatory marketing channel.
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