Seems like a simple question, but actually a hard one to answer.
What metric should we use to judge a station’s health?
If we use share, do we look at how the top stations are doing? Do we look at how well the majority are performing?
What about the stations struggling at the bottom of the rankers. Shouldn’t we look at those too?
Last post we stepped into the middle of the Rock is Dying debate to illustrate the problem of answering the question. In this post we’ll dig a little deeper and show how really complicated things can get.
We’ll also show that while Rock isn’t dying, it is far from stable.
We’ve plotted 6+ shares against market size for all the stations with at least a one share.
Notice how widely scattered the shares are. While there are stations with 7s, 8s, and 9s, there are also plenty of stations with 2s and 3s.
Shares vary a little by market size, but perhaps less than you might expect.
While the smallest market Rock stations tend to have larger shares than the top markets, things are pretty even through the top 25.
When stations in the same format can have two or three times the share of other stations in the same format, is share really a useful metric?
To come up with a single measure of health, we can just average all the stations in the format, but the few stations with large shares drive up the average.
The second graph looks at median by flavor of rock. It compares Classic Rock, Mainstream, and Alternative. Classic Rock has a median of 4.2, Mainstream 3.7, and Alternative a 2.9 share.
It means that Classic Rock stations tend to out-perform Mainstream stations, and Mainstream stations tend to out-perform Alternative.
Looking at the median station may be better than looking at the average station, but is it really all that helpful?
Every station is a unique story. The number of competitors combined with the history of the market make every market different. That’s why two identically sounding stations perform differently in different markets.
And it still doesn’t address the original question of how well the format itself is doing.
Momentum is a metric that tells us whether stations within a format are growing or declining.
While unique local conditions have an impact on a station’s share, stations in the same format still tend to move in the same direction over time.
If we watch how individual stations within a format perform over time, we can see whether a format is growing or declining.
As we wrote in 2002:
Formats go through cycles of boom and bust. Formats that were once popular and growing lose their popularity as listener tastes change.
The cycles are driven by the cycles within pop culture. Nostalgia, rock, pop, country, rhythm and hip-hop all go through periods of growth and decline, primarily based on the strength of the music.
How do we determine momentum? We look at the stations that have been in a format for at least a year and see if each station is higher or lower than the previous year.
If a majority of stations are higher than last year, the format has positive momentum. If the majority of stations are lower, the format has negative momentum.
So what kind of momentum does Rock have?
As the third graph shows, Alternative has positive momentum. Slightly more than half of Alternative stations are ahead of where they were one year ago.
Mainstream Rock is flat. While half of Mainstream Rock stations are up, an equal number are down.
While Classic Rock may have the highest median share of the three formats, Classic Rock has negative momentum. More stations have lower numbers than they had last year.
Most station share changes from month to month are random, an issue we discussed in a 2010 post.
Looking at the movements of all stations in a market, we find that in any month half of the stations go up while the other half go down. (Share always totals 100.)
In the following month, most stations will change direction. In other words, if you have a good month, it is more likely that you'll have a bad month, than a second good month.
Directionality improves over time as we aggregate more stations over more months, but even then random wobbles can obscure real changes.
So we’re not yet prepared to declare Alternative's positive momentum the dawn of an Alternative renaissance, but it may indicate a shift in Rock listening.
We’ll just note that our Winter 2003 analysis looked very different.
During a time when Alternative was drifting downwards, our momentum analysis showed that only 42% of Alternative stations gained share from the year before. In contrast, a majority of Classic Rock stations had made gains over their 2002 numbers.
Classic Rock’s decline here is of note also because of the large number of stations in the format and the relatively high proportion of stations in decline.
Is Rock dying? Absolutely not.
But within Rock itself, something may be going on. There's a hint of format rotation within Rock. We see evidence that Classic Rock's growth has stalled, and Alternative is gaining momentum.
Note: We suspended our analyses during the transition to PPM because the change from diaries to meters made trends impossible. Arbitron has now completed the roll-out and we have previous year ratings for most stations.
We’ll be posting similar analyses of other formats shortly.