Thursday, July 19, 2007

Some thoughts on CBC Radio management's strategy for Radio Two

In a Globe and Mail article published in the March 19 2007 edition, Ms. Jennifer McGuire, Executive Director of Programming, is quoted as follows:

"'And we are trying to have a service that is sustainable, with an audience that regenerates.' In other words, McGuire said, Radio Two's target audience is between 35 and 49 years old, yet the majority of current listeners are over 50. So the network is looking to attract a relatively younger, although still adult audience."

Statistics Canada has recently released some interesting data that allows an interested former CBC Radio Two listener to analyse the wisdom of the above statement. The data recently released by Statistics Canada is: (1) a survey of the radio listening habits of Canadians during 2006 and (2) the 2006 census data.

(In the best interests of my readers, I should point out at this point that the rest of this blog entry will very likely bore the pants off you if you are not (a) a thoroughly outraged former CBC Radio Two listener or (b) already working for Statistics Canada or (c) a student of business strategy and/or marketing who is looking for an idea for a term paper. Just for the record, I am in group (a).)

Now, if CBC management's target audience is the 35 to 49 year old age group, then presumably they hope that the 35 to 49 year old age group will be listening to the radio more than any other age group and that there will be more 35 to 49 year olds listening to the radio than any other age group. After all, if you are in the business of offering a product to consumers, you should be targeting the group that (a) has the most members (b) will use your product the most number of times and is also increasing their use of your product and (c) that can benefit from your product the most (if you are a not-for-profit organization) or (d) who pay the most for your product (if you are a for-profit organization).

Given these principles, we would expect that since CBC Radio management is targeting the 35 to 49 year old age group, this age group is (a) the largest (b) listening to radio the most and (c) will benefit from CBC Radio's programming the most. We can use the recently released data from Statistics Canada to check whether this is the case.

Well, guess what? Using the survey of radio listening data and 2006 census data, one can determine that the 35 to 49 year old age group's total radio usage has in fact declined during the years 2002 - 2006! And furthermore, they are not the largest age group - it is the much-maligned 50+ age group that listens to radio the most and, what is more, the 50+ age group's radio usage is increasing! See the graph below. (For those who find the graph too small, my apologies. The top line is the 50+ age group, the middle line is the 35 - 49 age group and the bottom line is the 18 - 34 age group.)

Now so far, CBC Radio management has missed the mark on the target market selection criteria (a) and (b) that I have listed above. But what about criteria (c)? Who will benefit the most from CBC Radio Two's programming? To answer this, we have to look at the listening habits of each age group.

From Statistics Canada's radio listening survey we find that the percentage share of radio listening by format for the 35 to 49 year old age group is as follows (I only list the formats up until we hit the CBC's numbers, there are more formats that I don't bother to list here. The interested reader can see the full data tables at this link.)

Gold/oldies/rock: males 21.7%, females 14.8%
Adult contemporary: males 19.6%, females 35.9%
Album oriented rock: males 10.3%, females 5.2%
Talk: males 9%, females 2.5%
Contemporary: males 8.8%, females 8.3%
Country: males 8%, females 9.8%
CBC: males 7.5%, females 7.6%

(I think Stats Canada meant "Golden oldies/rock" for the first category, but never mind. We get the idea.)

For the 50 to 54 year old the percentage share is:

Adult contemporary: 19.9% , females 32.1%
Gold/oldies/rock: males 17.8%, females 12.4%
Talk: males 12.2%, females 8.6%
CBC: males 11.9%, females 12.8%

For the 55 to 64 year olds the percentage share is:

Adult contemporary: males 20.6%, females 25.1%
CBC: males 16.9%, females 19.2%

And finally for the 65 years old and over group the percentage share is:

CBC: males 22.6%, females 24.6%

Not surprisingly, CBC Radio takes a greater share of each age group as the age groups advance in age - this is what we expected. However, if you are a CBC Radio executive and are trying to decide on a new format for CBC Radio Two, do you really think that the 35-49 year olds will benefit from another radio station moving towards a contemporary format? No, the 35-49 year olds already have a plethora of Adult contemporary/Contemporary/Album Rock/Golden oldie stations to choose from. Those who will benefit are those listeners who do not already have an alternative - i.e. the 50-54 year olds (among whom CBC is #4), the 55-64 year olds (among whom CBC is #2) and the 65+ year olds (among whom CBC is #1). As I've pointed out in previous blog entries, there are very few stations broadcasting classical music - CBC Radio Two presented an alternative to commercial radio, but does not do so any longer.

"Well, this is all just fine", you may be thinking, "but guess what James? The 50+ age group are going to be dying off! What then?"

Which brings me to my final point - demographics. If you consider that the oldest baby boomer is now 61 years old and the youngest is 41, you will see that over the next 10 - 20 years the largest target market will be the 50+ age group. I know this is something that those who are not part of the baby boom generation find intolerable, but it just happens to be fact. As time goes on, and the baby boom generation ages, there will be increasing numbers of the 50+ age group for CBC Radio to draw its audience from - which brings me back to criteria (a) and (b) - the 50+ age group is the group that will be the largest target market and who is actually increasing their radio listening. See the chart below.

(Apparently I can reproduce the above chart as long as I include the following text, as well as a link to the Statistics Canada data:

Statistics Canada information is used with the permission of Statistics Canada. Users are forbidden to copy the data and redisseminate them, in an original or modified form, for commercial purposes, without permission from Statistics Canada. Information on the availability of the wide range of data from Statistics Canada can be obtained from Statistics Canada's Regional Offices, its World Wide Web site at, and its toll-free access number 1-800-263-1136. )

"Ah", you may also be thinking, "but what makes you think that the current group of 41 - 49 year olds, 50 - 54 year olds and 55 - 64 year olds will listen to classical music and CBC Radio when they are 55+ or 65+? What makes you think they won't still be listening to Van Halen, the Grateful Dead, Duran Duran (dear God, no) or the Rolling Stones?" (Who, I assume, will still be touring in 2022.)

Well, I don't have any assurances to give you that these age groups will still be listening to CBC Radio and classical music as they age. But I can tell you this: if it's CBC Radio management's goal to kill off interest in CBC Radio and classical music among these age groups, then they're doing a damn fine job of it.

If I can do the above analysis in my spare time using publicly available data and reach the conclusion that CBC Radio management is missing the most desirable target market in their recent decision to broaden the scope of CBC Radio programming at the expense of classical and new music programming, why can't CBC Radio management see this?

If you have any criticisms of the above analysis, or if you are a CBC Radio executive willing to defend your decisions in a public forum, I'd like to hear from you. As I've said before, I'll publish all comments, as long as they are not derogatory, defamatory and do not use profanity.

1 comment:

Anonymous said...

Very good work. CBC Radio 2 is now an unmitigated disaster.