THE RACE TO BE NUMBER ONE

Consolidation is the name of the game with Bauer currently spending money like a drunk on payday.

Nationally, they have always been impressive while locally, miles behind the ball. That can’t continue because radio is big business with fat profits for those who get the formula right.

Make no mistake, winning is everything, especially in the commercial world and if you think life was competitive before, you’ve not seen anything yet. What this past week has shown is that Bauer are no longer content with being second. As the table below highlights (thanks to Matt), there is still a gap between first and second place, but it’s narrowing. Don’t forget Bauer also has Scala coming on stream soon which may take audience away from Classic which in turn will reduce the gap even further. It is possible, therefore, that with a little luck and a well thought out strategy, the tables could be turned. This, of course, assumes Global won’t react and I very much doubt that. They’ve had a clear strategy for over ten years with the best programming brains in the business but should they take a cough on LBC, Classic or Heart, anything could happen.

What we do know is that cheque books don’t bring success, people do. You need to have the best, constantly evaluating what you have and just because someone may have been brilliant last year, it doesn’t mean they are the wisest choice for tomorrow. That said, they will be excited as it’s always more fun being the chaser than the defender. You have everything to gain while they have everything to lose and momentum is a very positive force indeed..

Hours.jpg

Overall, there is not a lot more to buy that would make any real difference so further growth must come from sweating your assets more effectively. If closing that gap is an all important goal, I would be marketing GHR much harder as we know the older audience add a lot of hours if not huge cash.

Clearly, you can’t buy all of these stations and not be ready to drive change. As James Cridland points out in his blog, Global are the leading group in the UK with just 8 big brands while Bauer now have a staggering 100 or more. You can’t manage all that from a programming and sales perspective easily so a big review is coming. Otherwise what’s the point? Why they don’t just roll out their big national digital brands on their local services is a mystery to many.

I suspect Bauer will wait until Global reveal their new strategy before confirming their own. Readers will be aware that the market leader hit the pause button just before Christmas telling staff that they were seeking clarification from OFCOM on what they can and can’t do around certain areas. In any case, there is no rush because it takes time to successfully integrate acquisitions into the wider group and there is a lot to consider.

One of those is how you mix people together within an enlarged group. Are those in Bauer more talented than those they have just acquired? Believe me, it is a dangerous thing to believe that just because you’re the buyer, you have the better talent. And then we have the Scottish issue. Do you rebrand a successful group of local stations in order to run a brand led UK strategy? That alone is a big call but this is where strong leadership comes in. You either have a strategy, or you don’t.

And yet, through all of this, I have this thought about the Wireless Group. They sold their local assets for the right reasons but I just can’t believe Rupert will enjoy sitting in third place for long. Even if Evans brings in 2 millions listeners and 10 million hours, they will still be a long, long way back. Commercially, it will be like going to agencies armed with a pop gun while Bauer and Global are turning up in tanks. They may still do well, but not well enough to matter. They may even step outside of the UK to gain more radio but whatever they decide, being last in a short list of three is not a great place to be.

Let us not forget that we live in strange times and ego gets more love than logic, certainly in radio. Being top dog matters so while people are throwing a few million about, it wouldn’t surprise me at all to see someone chucking a couple of billion on the table to see if that tempts a sale. You can argue that the top two are already owned by very rich people but hey, this is radio. Who said it makes sense?

They will disagree of course and talk about having a firm plan but to paraphrase Mike Tyson: Everyone has one of those until they get smacked in the face.

This game of musical chairs is far from over

john myers