Naughty or Nice? PPM Reveals Christmas Music Insights

Last Fall, dmr unveiled the first-ever comprehensive study of Christmas music in PPM markets. The study — which will be updated with new PPM markets next year — showed that a switch to Christmas music comes with big benefits along with some hidden costs. 

Unwrapping The Present: The Magic & Myth of Christmas Music, looked at Christmas music stations WLTW New York, KODA Houston, and WBEB Philadelphia. Three five-week periods were used to group listening before, during, and after Christmas.

Not surprisingly, the all-holiday format triggers a massive audience increase. KODA doubled its 27,600 AQH persons during the five-week Christmas period. Typically, ratings gains are driven by an increase in the average number of occasions, not time spent per occasion. That’s not the case for any of the Christmas music stations. In fact the average number of occasions goes down from 21 to 16 per week. However, time per occasion increase by 20 percent from nine minutes to 11 minutes.

In addition, prior to Christmas, KODA was running with a 197,000 P1 cume; during Christmas, it shot up to 375,000.

One-third were previous KODA P1s, two-thirds were new P1s. We saw a similar effect in Philadelphia and New York. In each case, the majority of the new P1s came from older rock (classic and hits) or news/talk and sports formats. WLTW’s and WBEB’s newfound P1s had similar formatic origins. (Fred Jacobs recently released some PPM analyses that demonstrated similar conclusions here.)

After Christmas music, KODA’s ratings were flat or below what they had been before the switch. KODA lost nearly 200,000 P1s after Christmas—more than they gained. Why? Looking at every listener KODA had in the five weeks before Christmas, we discovered 43% of KODA’s prime P1’s (heavy radio users who are deeply loyal) go away while KODA is in all-holiday mode and they don’t come back in the five weeks after holiday programming ends.

So, while the station nearly doubles its P1 cume with new listeners from rock, news/talk and sports, most of those new P1s go back to their usual choices. Left with 43% fewer prime P1s, KODA’s AQH drops because those who remain don’t use radio as much; overall they’re not very good radio listeners. A similar pattern emerged in New York and Philadelphia.

WBEB lost one-third of its prime P1s but gained 244% in new P1s during Christmas and swelled up to almost 88,000 AQH persons (up from 37,000). In New York, WLTW lost half its prime P1s but more than made up for it in new P1 reinforcements.

In all three cases, prime P1s fade during Christmas music by an average of one-third to one-half, and most did not return. Instead, stations temporarily gain P1s and afterward end up flat or slightly better after Christmas music ends. That new structural change in audience makes it more difficult to sustain or build ratings in late January and February without actively marketing to your P1 listeners who switched during Christmas music.

The 4% Factor And How Small Groups Drive Success

Why It’s Critical To Radio

Recently AdAge pointed to remarkable new research that demonstrates repeatedly that 4% of consumers of a product or service drive most of the consumption. The Pareto Principle, aka, the 80/20 rule — 80% of the business comes from 20% of the customers — has compressed to the 4% factor.

In the article, How To Grow Your Business When Everything Else Is Shrinking, author Scott Morgan highlights “Catalina Marketing, with its Checkout Coupon system, recently identified that 1% of Iams’ pet-food buyers accounted for 80% of the annual volume of the brand’s sales via the supermarket channel. Cincinnati-based LaRosa’s Pizzeria chain found that a small percentage of pizza consumers account for significant portions of various menu items (for example, 4% purchase 65% of calzones).”

We’ve written extensively about Best Buy’s life-sustaining customer segmentation strategy that focuses on the most important customers rather than casting the net wide with TV hoping for any warm body to walk into the store.

Most importantly, a close look at the respondent-level PPM data conclusively supports this small % matters most factor. For example, in the White Paper, P1’s in a PPM World, our partners UW-Madison and Arbitron showed that even for Houston market leader, KODA about 4% of the market meters accounted for nearly half of the station’s listening. More recently, Bonneville’s record-setting WTMX shows small is the new big with nearly 60% of the station’s 25-54 listening coming from just over 1% of the Chicago market’s panelists.

Morgan maintains, “The 4% Factor goes well beyond a loyalty strategy — it is a penetration strategy — designed as a competitive approach to protecting and growing your business. Simply put, start smaller to get bigger faster. It also tends to be a much more sustainable approach than traditional strategies of casting a really wide net, going through trial and then hoping to retain a percentage of new customers.”

In what ways should this new insight direct your strategy? Consider these steps:

• Identify: Determine your PPM audience profile. You can look at P1 percentages to begin. In addition, dmr can provide insight and depth to help. Next, use your database to more deeply understand your listener profile (this can be appended to shed additional insight about their demographics, psychographics and potential listening behavior) and details gathered via social media and other research tools.

• Filter: Use geo-demographic data with PPM and with your database to segment, profile, and develop targets to focus your resources on the consumers and areas that provide the most leverage.

• Magnify: Examine, select and prioritize the top one to two target groups. Test various messages and approaches and look for deeper insights with those target groups. Seek to deeply understand the consumer and their lifestyle.

• Penetrate: Target and grow selected communities via multi-faceted, integrated communications strategies ranging from mail, phone, text, digital, and social media in order to establish dialogue and grow the loyalty and engagement with existing and new advocates.

• Amplify: Brands are built by communities of like-minded individuals who share their brand experiences with others and those with whom they have some connection. Pinpoint those communities (both virtual and physical) and find creative ways to get them to help recruit your new listener or build loyalty among existing listeners.

New: One Stop for Industry News

We thought it might be valuable to share our news widget, dmr RadioActive. It’s an easy-to-use way to see the key industry trades quickly. Along with the widget, we have a mobile version and a tradtional RSS feed.

 

Click on the image below to launch the widget.