Not to be argumentative Kent, but where is the evidence?
The ratings last holiday season pretty well showed it. As I'm sure you remember, Cox didn't do all Christmas on most of its AC's because their research indicated the audience they had and were after didn't want to hear a month of Christmas music. If you look at Atlanta, WSB-FM showed a slight uptick in December. In Tulsa, the Holiday book was slightly higher for KRAV, too. They held, and even increased, their audience, and that tells me their research was good. I'll grant you that Lite 106.9 was lower in Fall '12 than it's been since and didn't see the same results WSB-FM and KRAV saw, but Lite has had its own problems over the last few years. Cox has never been a company that's been accused of under-researching anything!
Fewer stations are going all-Christmas because advertisers like younger demos? Two things wrong with that sentence. First, AC stations that switch get a bump in ALL the demos, even younger ones. And second, when there is no AC in a given market, it's often the Hot AC station in town that jumps in to fill the void. In fact, when an AC station gets a boost at the end of the year by playing Holiday music, it's often the Hot AC, along with Country, Urban AC and Talk stations that see a small drop in their numbers.
I haven't observed many hot AC's dropping with the all Christmas format. I've usually seen much the opposite. In fact, Kansas City's former E-105.1, an 80's leaning hot AC, used to see its audience jump as much as 40% when the AC's went all Christmas. Since flipping to Jack FM in either '04 or '05, its highest numbers were often when KSRC/KCKC and KUDL went all Christmas. Its ratings have steadied out a lot more since both of the AC's went away. Y-98 in St. Louis also outperformed when sister KEZK and Clear Channel's KLOU went all Christmas last year. CHR's also hold their own during the holiday season, and they're more of an AC competitor today than ever before. I'll agree with you that country, urban AC and talk see drops, however. Of course, country's median age is about what a traditional AC's is, though the audience is more male. Urban AC typically has a higher median listening age than country, and talk is the oldest of all three. That tells me older listeners tune into the all Christmas format more than the younger ones do.
Fewer AC stations went all-Christmas last year? Maybe that's because in some markets, as many as FIVE stations once flipped!
The big difference last year was that stations that had historically been "The Christmas Station" walked away from it. I won't say there were no markets that didn't have five all Christmas stations, but I'm not aware of any. Most had no more than three, and I'll agree that's too many. In fact, you rarely see more than one all Christmas station benefit from such a flip. There's really not enough of that audience to go around.
So if now only three stations are running Holiday music, I guess that's a reduction, but hardly indicative of any trend. The truth is, when you look at the December and Holiday ratings periods, 90% of all markets have an All-Christmas station in the #1 slot. Some stations like WLIT Chicago and KVIL Dallas double or triple their normal ratings. In NYC and Philly, WLTW and WBEB often go into double digits. I'm not sure I could find a top 100 market where the Holiday station wasn't #1, #2 or at least #3.
Funny you mention KVIL. Guess what? It just announced this week that it's not doing all Christmas this year. CBS is another company that seems to want to move all Christmas off of its AC's. In Dallas, the older-skewing KLUV will be going all Christmas instead. Some think part of the reason for the all Christmas stunt is because KLUV is changing formats, though CBS has gone all Christmas on several of its classic hits stations before. Keep in mind that, while holiday music usually does very well, it's a double-edged sword. Before it got swallowed by Billboard, Radio & Records did a survey that found more than 90% of participants surveyed thought Thanksgiving Day was too early for all Christmas. That number didn't go below 90% in any demo until the "two weeks before Christmas" mark. Of course, in most markets 8-10% is enough to put you in the top-3. In other words, you can get good ratings and free advertising doing it, but much of your existing audience will listen less and disperse. Audience growth after the holiday book is also usually around zero.
I'm not sure I understand why it works so well, where a station abandons its normal hits for 6 or more weeks, where it's playing long dead artists (Crosby, Sinatra, Cole, Karen Carpenter) it would never play any other time of the year. Where it's playing instrumentals (Leroy Anderson, Manheim Steamroller, Kenny G.) or artists nobody today knows (Harry Simeone, Burl Ives, or again, Leroy Anderson). But clearly it gives a boost to many stations that do it every year.
Christmas music has always been a salesperson's dream and a programmer's nightmare. From a programming perspective, there's so much that can go wrong it's a major headache. You have to redesign your clock and schedule almost twice-as-much music every hour because few Christmas songs run longer than 2:30, and you have only a handful of titles to choose from, which makes separation difficult. A good portion of your regular audience goes away, and almost no one listens as long as they do when you're in format. Then, you have to worry about getting back the audience that left you or listened less often for a month or more, though most of them come back on their own, and January's often a soft advertising month anyway. TSL is an absolute horror story, but it's not a sales metric. Sales people can sell the crap out of the Christmas format because shorter songs mean you can add more avails, and the higher-than-normal sampling of your station means more people want to buy longer schedules. However, the bounce is always temporary, and you have to hope the dispersal will be, too.