Radio's New Media Gauntlet - 18-34 Year Olds

March 15, 2018

Traditional radio has been facing an almost continuous onslaught of new media competition for most of this century. It began in earnest with the advent of short-lived music file sharing service Napster plus satellite radio and smart phones.

Bridge Ratings has been tracking the impact of the multiplying digital media on radio partisanship since 1998 and when displayed on a graph, the entire audio consumption landscape is vivid.

In our latest installment of this bi-annual study completed in February 2018, podcasting usage and smart speaker technology have been added.

For the purposes of this analysis, we will focus on the most active lifegroup, the 18-34 year olds who have adapted to the new tech so easily because they literally grew up with it all over their media and personal lives.

Most striking is the "favoriteness" scores trended for radio, on-demand music streaming, podcasting and smart speaker use.

We define "favoriteness" as a way to determine primary daily use of a technology. 

So, what is really going on with this group of audio consumers?

Ease of use and discovery have been perhaps the final two barriers to a more rapid rise in podcasting consumption.
— Dave Van Dyke, President Bridge Ratings Media Research

How to read: trend lines refer to the various media and their annual favoriteness percentages over time for 18-34 year olds. Radio was still a primary consumption platform in 1998 on the left side of the graph and over time has fallen to under 60% in 2018 saying they use radio as a primary source. On-demand streaming (red line) began significant growth in 2007 with the arrival of the iPhone with 19% of this age group saying it was their primary way to consume music. By 2019 this number will have risen to 92%.

In evidence is the gradual decreasing in usage by 18-34 year olds each year. And no matter the year, the adoption and subsequent heavy usage of on-demand music streaming and podcasts is eye-opening.

Podcasting has grown steadily since we first starting tracking its use in 2012, but you'll note that the growth, unlike streaming for example, is more gradual. We believe this has more to do with the manner in which the concept of podcasting has expanded throughout society. Podcasting's growth has been primarily at the hands of word-of-mouth or through recommendations of hosts on podcasts that are being consumed.

The trend line for smart speakers is more rapid due to media attention, pricing and word-of-mouth.

Click on image to enlarge.

Perhaps the most striking trend on this chart among 18-34 year olds is the power of podcasting when coupled with smart speakers. The blue dotted line represents the growth trend of the combined technologies among this group. We believe that as smart speakers are used to easily access podcasts of choice - and especially for discovery - podcasting's growth will begin to mirror that of on-demand streaming.

The combination of on-demand music streaming, powered by playlisting especially, and podcasting is at the core of the attrition the radio industry has been experiencing.

Using the trends of the last 18 to 24 months as a basis, we are projecting that favoriteness among 18-34 year olds will drop below 50% for the first time in 2021 as the acceleration of smart speakers, music streaming and podcasting become the primary source of audio content for this age group.

Ease of use and discovery have been perhaps the final two barriers to a more rapid rise in consumption. The one-two punch of podcasting and smart speakers should overcome this.

For radio, the future is this generation and to slow the decline of daily usage, the industry should consider accelerating its use of podcasting, especially with topics that focus on the lifestyles of the young. Fortunately, radio has the advantage of a built-in weekly audience to which it can promote podcasts. With quite remarkable on-air talent, ties with the music and entertainment industries and high production value, radio should be able to slow the attrition. 

The question is: are there enough financial resources to accomplish this quickly and is there a will to make it happen?