HD Radio: Why Marketing Matters

I was impressed with the British Invasion in the 1960's. "Those Brits are real good", I thought to myself as the whole string of music successes starting with the Beatles came across the 'pond' to invade America.

Now, they're showing up America once again, but this time it's in the area of HD radio - or "Digital Radio" as they package it.

In a survey just released by Britain's ratings service RAJAR, more than 25% of the British population listen to digital radio, defined as Digital Audio Broadcasting, Digital Television and the Internet.

At first glance, this is rather impressive. However, when combining those three digital radio sources in the U.S., the percentage of the American populous that listens to some form of digital radio is closer to 50%:

• Internet radio - 60 million
• HD Radio - 500,000
• Digital TV - 90 million homes

What is intriguing is the marketing of digital radios (comparable to the U.S. HD concept).

Unlike the U.S. where broadcasters must market HD radio by themselves and with the help of the National Association of Broadcasters, the United Kingdom has a dedicated body: the Digital Radio Development Bureau.

It has become clear in our studies at Bridge Ratings that there is considerable consumer confusion in the U.S. about HD radio and its benefits. Three quarters of the U.S. population has heard of "HD Radio". Less than 5% really want it.

So, the Brits and their Digital Radio Development Bureau are taking the U.S. broadcasters to school about digital radio. Here are some of the ways Digital Radio is marketed in the UK:

• More Choice - "Because of the way it transmits a signal, DAB Digital Radio can double the number of radio stations you can get on FM. Many cities will pick up around 40 stations, and in London you can receive more than 50!

There are national, local and regional stations on DAB Digital Radio, and more than 85% of the population is covered by the DAB signal.

It's not just more of the same... there are new, unique stations on DAB with programmes designed for different segments of the population. So, rather than trying to be all things to all people, DAB means you can have stations dedicated entirely to dance, hip-hop, garage, rock, jazz, big band, country, pop, soul and disco. Or your can get stations specifically for young children, the mature listener, ethnic communities, news junkies, sports fans, lovers of the spoken word, world music and environmentalists, gays, classical buffs, ...in other words, something for everyone."

• No Interference - "DAB Digital Radio means interference free listening in digital quality sound. There's no hiss, crackle, or pop, no fading, no overlap, just great radio all the time. We've surveyed thousands of DAB owners and nearly 90% reckon DAB sounds great."

• Ease of Use - "Quick, what's the frequency of your favourite FM radio station? You'd be surprised how many people know the name, and kind of, sort of where it is on the dial, but waste time searching around for it. Some people are even afraid to change stations because they worry they'll never get back to their favourite. Others mark the dial with a pen, or sticky tape so they'll always be able to find their way home... a bit like a trail of breadcrumbs.
  
  With a DAB Digital Radio there are no frequencies. Just choose the station you want by name from the text display screen. It's easy every time and you don't need to worry about getting lost."

• Control Time - "With some DAB Digital Radios let you pause and rewind live radio. And with some of the latest models, you can record radio to a memory card. For the first time this puts you in control of when you listen to the radio. You can stop time, go back in time, or set a timer to record a future programme."

• No Re-tuning - "National DAB Digital Radio stations, both commercial and BBC, are broadcast on the same frequency across the country, so you never need to retune when you're on the move."

Does all this sound vaguely familiar to you? It should because it is almost exactly the Satellite Radio model. In the UK, though, the contemporary evolution of radio is focused on Digital Audio Broadcasting (DAB) services, such as HD Radio rather than satellite radio.

Much has been said of American radio's indecisiveness when it came to moving into the 21st century with HD/Digital Radio. It took so long, Satellite Radio took the position right away from U.S. Broadcasters. And now the fight to insert HD radio into the lives of Americans has become an offer of another product where there already is one.

Yet, marketing may solve this problem - but it also may be too late.

In our society we thrive on choice - too much choice - and the successful products that have identical competitors are the ones that market and position themselves most skillfully. Has anyone read Ries & Trout's The 22 Immutable Laws of Marketing"?

Oh, and one more thing. Digital radios in the UK start at about $58 (29 pounds).

So, while the UK has managed to effectively launch Digital Radio, U.S. Broadcasters - who should know better - are fighting a positioning battle which, frankly, is over.

HD Radio in the U.S. is a niche market out sized by Internet Radio and Digital TV music services. And portable digital radio will be real with the arrival in the near future of wide-area-wireless Internet or Wi-Max.

This lesson has been difficult to learn - but it is time to face the facts.