Who Makes Money in Radio

[job]

NY Daily News (David Hinckley):

________________
If you wonder why radio formats like oldies and adult standards disappear even though they have large numbers of listeners, the main reason is simple.

Radio owners measure success less by listenership than by ad revenue, and if a big audience doesn't translate to big ad dollars, the format may be expendable.

That harsh truth is reflected in a new national survey by Miller Kaplan (MK) on radio's 2005 "Power Ratios" - how various formats convert listeners into ad dollars.

A "power ratio" of 1.0 means a format breaks even. It has, say, 5% of the audience and makes 5% of the revenue.

Below a 1.0 is not good. Adult standards (the old WPEN), for instance, have 2.45% of the audience in the MK survey, but only 1.08% of the ad dollars, for a dismal "power ratio" of 0.44.

In other words, a station programming adult standards might well see a chance to make more money somewhere else.
_____________________________________

Here are Philly's "real money" Power Ratio ratings:

News (KYW) 1.99
AAA (SoJo) 1.58
Rock (MMR) 1.52
Classic Rock (Magik; The Hawk) 1.50
AC (The Bee; Sunny) 1.44
Sports (WIP; WPEN) 1.44
News/Talk (NTP; NJ101.5) 1.29
Country (XTU) 1.26
CHR/Pop (Q102; PST) 1.20
Talk (PHT; YSP) 1.16
Adult Hits (Ben) 1.13
___________________________________
Christian AC (ex-BYN) .99
Oldies (OGL) .97
CHR/Rhythmic (Wired) .94
Urban AC (DAS-FM; 107.9RNB) .94
Urban (Power 99) .92
Smooth Jazz (JJZ) .81
Gospel (Praise 103.9; DAS-AM) .55
Adult Standards (Old PEN) .44

Based on this:

All those Urban format stations don't make good business sense (regardless of what anyone thinks of the music).

Maybe someone should flip to AAA.

If Clear Channel flips an FM to talk, Smooth Jazz would be most likely.

 

[Starscream]

> Here are Philly's "real money" Power Ratio ratings:

> AAA (SoJo) 1.58

I think you just gave Andy Santoro and Eric Johnson a heart attack.

 

[job]

> > Here are Philly's "real money" Power Ratio ratings:
>
> > AAA (SoJo) 1.58
>
> I think you just gave Andy Santoro and Eric Johnson a heart
> attack.
>

Never listened. Can't get it. Why all those posts when the station first came on calling it Alternative? Basic point: At 1.58 somebody probably could make more money with AAA. Although Sojo would not be one of them - Hot AC is 1.78.

 

[vumeter]

Remember, these are national 4 book averages, against 12+
As to AAA and it's 1.5 power ratio, most Triple A's have a 2 share,which on average gives them a 3.5 in revenue. Also, it's distorted in that most of the successful ones were in the format over 10 years, evolving from AOR.
And, as to Urban AC, for example, with a .94 power ratio, most have a 5 share or better in Arbitron, giving them an average of 4.7, which is a 34 % advantage over the AAA power ratio.
Another factor is operating cost. Is it a format that is cheaper to do?
So...ya gotta watch the stats...many a good format was blown up because of distorted statistics.Just my observation.I could go all day on power ratios...

 

[Starscream]

> > > Here are Philly's "real money" Power Ratio ratings:
> >
> > > AAA (SoJo) 1.58
> >
> > I think you just gave Andy Santoro and Eric Johnson a
> heart
> > attack.
> >
>
> Never listened. Can't get it. Why all those posts when the
> station first came on calling it Alternative? Basic point:
> At 1.58 somebody probably could make more money with AAA.
> Although Sojo would not be one of them - Hot AC is 1.78.
>

SoJO is not an AAA. That's the issue. It leans definitely more towards a mature-oriented Hot AC than an AAA.