Tripp Eldridge is a host and member of the Cincinnati Public Radio station WVXU which producers his weekly show Start Hear where he plays the role of "Podcast Jockey" to introduce his audience to new national and local podcasts.
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Campbell: For many older media, like newspapers, magazines and network television, audiences have been shrinking dramatically in the wake of the Internet and social media. But one legacy medium is still growing its audience and that's Public Radio. In fact, last year, National Public Radio reported that its listeners top thirty-seven million, the largest number in N.P.R.'s fifty plus year history. Radio and its audience are the subject of this episode of Stats and Stories. Stats and Stories is a partnership between Miami University's departments of statistics and Media, Journalism and Film as well as the American Statistical Association. I'm Richard Campbell, chair of Media, Journalism and Film and doing double duty as moderator today as Rosemary Pennington is away. As always, I'm joined in the studio by our regular panelist John Bailer, Chair of Miami statistics department.
Today's guest is Tripp Eldridge. Tripp is the president and C.E.O. of D.M.R. Interactive, a leading international marketing consulting firm for Media and Entertainment. He also knows a lot about radio and ratings and full disclosure, Tripp and I are both board members of Cincinnati Public Radio. Thanks so much for being here today, Tripp.
Eldridge: Thank you! Appreciate being here, gentlemen.
Campbell: Yeah. So, let me start with this. We first heard radio was dead in the 1950s, when T.V. came along and the T.V. set replaced the radio set as the center of attention in our living rooms. So, what's the deal with N.P.R.'s impressive growth here in the twenty first century?
Eldridge: Well, that's a great question and I would say that N.P.R. is probably one of the best consumer brands in understanding its audience. They've spent a significant amount of time and resources in researching and understanding what it is that brings people to N.P.R. or why do they have such great, almost incomparable loyalty to N.P.R. and what does the future bring for that audience. I think they've done an incredible job of really understanding their audience more than most consumer brands, let alone radio.
Bailer: How do they do that? How do they understand their audience? What do they do to get that insight?
Eldridge: Well, they focus on a lot on listening to their community. They spend, for example, they have…there's an entire Facebook group that helps them with one of their apps, gives them feedback for the apps. What do I like, what I don't like, what features would I like…there's an entire community called N.P.R. Listens that you can opt into or used to be able to opt into, on a regular basis and they would simply ask questions and get feedback and then they do more conventional or formalized research, where they're inviting people to give their thoughts and opinions, attitudes via the internet, email and online forms and things like that and then they actually bring in groups and talk to them in person as well. So, it's a significant amount of research.
Campbell: Yeah. I remember a few years ago they said that people, young people don't really start listening to N.P.R. till they're twenty-five and I had this experience with my son who is twenty-five and he said, have you ever heard of this person called Terry Gross?
Eldridge: (Laughs out loud) There it is!
Campbell: So yeah for twenty years I've been listening to her. So, he had discovered public radio when he was twenty-five years.
Bailer: Does that mean you're forty-five, Richard? Let's do the math!
Campbell: So, what I want to know is today there are so many channels and resources for young people, but N.P.R. is managing to grow that audience, public radio is growing that audience. So how are they doing that?
Eldridge: Well I think it…
Campbell: Just with the groups you talked about?
Eldridge: I think it does get back to understanding the audience and the listener and that goes beyond just - what do I like, what don't I like, but what's your life like? What are your passion points? What are some of the areas in your life that are areas that N.P.R. can connect with? For example, along with being one of the first and leading organizations with apps and that kind of podcasting and the whole sort of nontraditional radio environment, they built an entire website called N.P.R. music, because they discovered that one of the most important passion points of the N.P.R. audience across the age spectrum, from the young people to older people, is music and music is a binding force for the N.P.R. audience.
Campbell: So this is a show about numbers. So I’m going to ask you about numbers here. So I was looking at some rating and share numbers and the Cincinnati station that carries N.P.R. programming W.V.X.U. had a 3.6 Nielsen rating or share I'm not sure what…
Eldridge: Probably share…
Campbell: …it was, in November and that dropped to 3.4 in January. I want to know if that’s a significant drop, but first I want to know for our audience, what's the difference between a rating and a share? What exactly does that 3.6 and 3.4 mean?
Eldridge: Sure. A rating point is the percentage of the population that's listening to that particular program, so it doesn't matter whether you have the radio on or not your divisor in that calculation is how many people are listening to this particular radio station at this moment compared to the entire population of that market, Cincinnati for example. In your case the 3.6 is called a share and the share changes the divisor from population to number of people listening to the radio at that time. So it's kind of like how big is the pie.
Campbell: So the share will always be a smaller number or a zero?
Eldridge: The share always be a larger number…
Campbell: Oh larger number.
Eldridge: It's a percentage of the people using radio in their…so what you're looking at, there's about average, between 10 and 20 percent of the population is using radio at any given time in Cincinnati. And then within that population that’s listening to the radio, how many are listening to W.V.X.U. So 3.6 says of the people listening to Radio 3.6 percent are listening to W.V.X.U.
Bailer: So does listening to radio entail also streaming? I mean is this all forms by which you might be interacting with this and is it all…is this also synchronous, you know, this is, at this time, for this station's programming?
Eldridge: Unlike T.V., it is synchronous. Radio is only at that time. There is no sort of catch up measurement like we find with television. But it does not include podcasting. So if the station streams as well, it's over the air. Its tracked terrestrial transmission is considered the same real time number that gets rated.
Campbell: So another number, at the top of the program I said N.P.R. had an audience of thirty seven million. Is that a daily average?
Eldridge: I believe that is a weekly.
Campbell: A week…so thirty seven, now that sounds right.
Eldridge: Yeah so the way we would express that number is, assuming that we're correct about the weekly, is thirty seven million people listen to N.P.R. for at least five minutes at least once during the week.
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Campbell: You're listening to Stats and Stories, where we discuss the statistics behind the stories and the stories behind the statistics. The topic today is radio and ratings. Our guest is Tripp Eldridge, president and C.E.O. of D.M.R. Interactive. Let me ask about Public Radio's future. We talked about young people in this audience and you know, I know as somebody who studies media history we've actually never lost a mass medium. Maybe the closest was the phonograph industry during the Depression. But media have a way of adapting, so can you sort of project out what you think is going to happen with radio? Like I listen to radio less now and listen to Pandora or Spotify more when I'm in a car but you know my other passion is public radio. So what do you think is going to happen?
Eldridge: Well I think in general, radio has a very secure place in the media landscape I think, because of its personal and local nature. Very few media can kind of have that, fill that kind of gap but also you know people really rely on radio as a companion. It's very much of a friend to them, it's fills in them ideas, it gives them entertainment, it connects to them and remember stations tend to be very…because there are so many of them, you tend to have this sort of unique personality that are attracting listeners who like that kind of personality. Primarily because of the music but not always. Sometimes it's for example with N.P.R. stations, it's the ideological focus, it's the comprehensiveness of the news, it's the local news, it’s the local community connection. So I think that's very secure and if you look at the information that's presented right now by Nielsen, radio, terrestrial, over the air, radio dwarfs by a factor of millions any kind of Pandora stream listening. I mean you know millions of minutes more is used for terrestrial radio than Pandora or any of the streaming. So radio is very much secure. It doesn’t feel like that oftentimes, because you know, we're experimenting, we're listening here and there, but if you look at the actual data, radio is strong and in some cases like with N.P.R. growing even stronger. So I think that future continues to be solid with that it's just one of those things that people need.
Bailer: I’d like to come back to this idea of rating points and shares.
Bailer: You know you talked about how the denominators differ in terms of definition. I'm just curious, how do you even get the information on the numerator and the denominators here?
Eldridge: That's supplied primarily by Nielsen and that information is gathered methodologically through what they call portable people meters. And Portable People Meter is a pager like looking device that's carried, you know, on your person somewhere, in your purse, on your belt. That technology obviously is continuing to evolve because you don't see too many pagers anymore and we all carry cell phones but it's still done as an independent device right now. It's put into a cradle at night and then that data is pulled back up to Nielsen every night so you as a Nielsen family for radio keep these meters, up to I think, ten per household, most households are two or three but that information then is stored and aggregated and reported on in either share or rating point through Nielson. So they determine how many people are listening at a given moment.
Bailer: And how do they decide who gets their people meters?
Eldridge: That's a great question. It's what they would call a random sample. So let's take it to the stats world. They randomly call people at home or because that's harder and harder, they'll send mail, a direct mail piece that invites your household has been selected randomly to participate and of course you may not have a landline so you have to call them back using your mobile phone and be part of that...well at least potentially be part of that research panel at that point. There's a series of steps you have to go through after that to get into the panel. But there are very few households that have that luck of being selected randomly, for example in Cincinnati I think there are a total of somewhere around 1700 meters walking around in this what - five county metro market.
Bailer: Now, I'm curious as you look at the evolving markets, you know, is commercial radio struggling? You know, given that you've said that public radio is increasing but what's happening with commercial radio and is it doing as well?
Eldridge: Well if you look at the overall you know sort of usage of radio it's primarily focused on…the main drivers of radio listening are full time employed people, people who commute to work outside of the home. So that's a very big population and a very important population and they tend to be very habitual. So that's why radio listening is relatively stable. The biggest driver of radio listening is age. The younger you are, the less you listen. This has always been the case, always. You know why? You have less access to radio. You're at school. When you're at school you have less access to the radio. It's always been that way. If you look at it, the younger you are, the less radio consumption you have, even with teens at home. In the old days, they still did not drive much radio listening. Stations that were totally teen focused never did very well, because teens just didn't have a lot of kind of disposable listening available - it just wasn't available. And as you get older, you tend to have more of that time, primarily because you work outside the home, full time.
Campbell: So in the old days and I imagine this is still true, they used to make a distinction. In radio they talked about drive time, in television we talk about primetime, those hours of the day when most listeners - it's usually in the morning, going to work or going to school, and in the afternoon, coming home. Is that still true today?
Eldridge: Still true today. The change in methodology from the paper diary with a one week paper diary to now the long term multiple weeks and months meters changed a little bit of that distribution in morning and afternoon but primarily you see that same sort of cyclicality that you go from very light radio listening to very heavy in the morning even heavier during the office or the work day and then a strong again kind of blips up again in the afternoon and then drops down to the evening, which was a similar pattern you saw in the other methodologies.
Bailer: Which doesn't surprise you that in terms of the pattern of the commercial breaks that you have and terms of the days listening!
Eldridge: Yeah. So even within an hour you have kind of a seasonality which is why commercial breaks tend to focus in the second half of the hour.
Eldridge: Yeah. We tend to be more forgiving as listeners when the commercials are later in the hour interestingly.
Bailer: Well it doesn't surprise me completely to hear that public radio has been relatively stable in part because if you're giving, if you're donating, you are kind of supporting the programming for all the programs that are occurring in that day, whereas the commercial entities are having to sell time. You know, they're having to make the case that people of this, that would be supportive, that would be...are listening, and hence you want to help us support them. So I would think that it would get harder and harder to justify that for some of the commercial stations.
Eldridge: Yeah I mean that's probably the biggest challenge that they faced. First of all there are so many commercial stations, you have a lot of pricing you know pressure downward because so many people offer options for advertisers. Public radio tends to be a little bit more of a unique sort of offering, so they can command a little bit higher price. However you're limited in what you can what you can produce and air on a public radio station as an advertiser. So you know there's a bit of a tradeoff, I can’t have my direct commercials on there as well so that allows me some times, to offset that.
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Campbell: You're listening to Stats and Stories where we discuss the statistics behind the stories and the stories behind the statistics. The topic today is radio and ratings. Our guest today is Tripp Eldridge, president and C.E.O. of D.M.R. Interactive. So earlier, to take it back to numbers, one of the things that we even started this podcast was to help, particularly our journalism students tell better stories about numbers and statistics. So one of the things I'd like you to address is problems that you see when numbers are reported in news stories. So for instance, in those earlier numbers where I suggested the share for W.V.X.U. went from 3.6 to 3.4 over a three month period is that significant? If you would make that like the lead topic - Ratings plunge at W.V. X.U., you know, as your title? So that would be just sort of one example of the significance of numbers but maybe you can think of some others that sort of bug you when you see them in journalism.
Eldridge: Sure. Well it's a tough understanding because first of all, because of the fragmentation of radio, there are so many radio choices right now, that the number one station in most markets across the country, ninety percent of people don't listen to it... just to show you, kind of, so you know if you have a ten share, you are high fiving in the hall! It's records! Even with that…so really most people, the vast majority don't listen to the number one station in a market. So what you have is, this what we call share compression. So there's very little difference between the number one and number five station and that gets in the margin of error. So the margin of error of the study, depending on what you're looking at, what time period you're looking at, you know, determines whatever that sample size is and as you know, sample size and margin of error go together. So the smaller the sample size, the greater the margin of error and so depending on what you're looking at, that margin of error may be bigger than the differences of the station's shares. And in the case of for example W.V.X.U. going from a 3.6 to a 3.4 is well within the margin of error of that study even using the new technology of these meters just because of the available sample at that at any given moment for all. So I would say you know even saying that W.V.X.U. went down is could be wrong. But we tend to focus on the midpoint of that margin of error and I think that it's a precise number and so that understanding of precision versus confidence interval is not well understood.
Bailer: But I bet the people that are selling ads for commercial stations are waiting just anxiously for the share information to come out.
Eldridge: Yes well yeah…
Bailer: …because I assume that a lot of the price points are going to be related to share.
Eldridge: Well most of the currency of ratings revolves around the rating point and you tend to have a little bit more stability because rating points are so tiny, you know, a point five rating you rarely see somebody even though you've got the precision more precision because of the share denominator you've got more variability in that when it comes to the rating point yes they'd like to see you could go up from a 3.4 to a 3.8 and it would still look like a point for rating points and so that maybe that's why they got an extra sales people upset we've got we went up and not enough to go over that threshold.
Campbell: This is talking about the relationship between commercial radio and noncommercial radio, but in radio history when radio had to overcome television coming in and stealing its advertisers, stealing its audience, they started specializing. They created formats, so we had the top forty format, I think today we call that contemporary hit radio, I think you pointed out interestingly how we…you know there may be fifty stations you can hear in a market like Cincinnati and even the early car radios were set up so there were five buttons because most people won’t even listen to five stations, that's what their capacity. Do you see this kind of format radio because there's like thirty different kind of formats…
Campbell: …if somebody wants to come in and buy a station and it’s struggling, you know, what would you recommend in a market like Cincinnati to somebody that wants to get into commercial radio, what's going to work today?
Eldridge: Well that's a million dollar question.
Campbell: What is something currently working pretty well that you can point to?
Eldridge: I think that W.V.X.U. for example, the news in the news talk format, that you know, has the service of really being a community connector is a really valuable, hard to duplicate sort of idea. That's one of the challenges of radio is you've got somebody can go in with the exact same playlist make you irrelevant or at least an also ran and that's you know that's one of the things that as you look at any kind of format and you've got to think about you know what is it that makes me unique and oftentimes that uniqueness can be expressed off the air and that's part of what we do with radio stations is we help them develop kind of their off air brand and that connection with the audience, understanding the audience, what are their listeners’ passion points, what we call the first preference listeners which I can talk about how who that is and we really start to connect to those people identify who they are, what's important to them and try to bring the station in a different way, more of a personal way to them in addition to the over the air as well.
Campbell: Right. What do you think is going to happen with satellite radio? I mean I remember, you know, you buy a new car and they give it to you for three months and then after three months, you're not going to pay. You know, I can get all the music I want from Pandora, Spotify and I can get it commercial free, fairly cheap. Is this going to be just driven by stars like Howard Stern? Is that what's going on?
Eldridge: I think we've seen that primarily, you know, it's a highly subsidized business, right? They're paying the car companies to provide that to you as a consumer, you get it free for a year or free for a long time. They've struggled with retention, and most people know that if you want satellite radio hold out for a couple months and they will give you an almost free deal because they need subscribers. So I think it has its value and it has its niche out there but it's nowhere near the power of radio, local radio that we know. So those are some of the things we found in similar really right now to most of the other online alternatives.
Bailer: You know you talked about kind of some of the things that are in this business that you might work on doing, you know working to understand the audience, working to develop off air brands. What are some of the skills that are needed to…if someone was interested in working in this space?
Eldridge: Well you know I think we're really at the early stages of it with data, but radio is now starting to really understand the value of knowing its audience in a way that gives them insight into the data that essentially gets, can get generated with that audience. You know these are people that are listeners to this station that also buy these products. That information is now being able to be combined in a way that makes it a really valuable tool for advertisers, in a way that goes beyond just running commercials on the air. Really what an advertiser is buying is, when they buy a radio station, if they're doing it correctly, they're buying this first preference audience, this really powerful audience which is a segment of their total audience and like we talked about, but it's really people who are, you know, passionately connected to this radio brand, to W.V.X.U. for example, who would go to the ends of the earth, for not just the station, but those underwriters or advertisers who say hey, we've got a great deal for you. There's a literal connection with that audience.
Bailer: So who’s the first preference audience for our local public radio station?
Eldridge: Well the first preference audience, just to give you a quick overview, is most people listen to five to seven radio stations in the course of the week. You tap around your dial in your car, like you said with your radio dial or your presets or whatever, but you tend to listen to one primarily and that maybe because that's your favorite one, it usually is, but it's not always sometimes you're forced at work or whatever or the kids or whatever, so but you definitely almost everyone has a first preference station. We call it a P1 station. That P1 station gets the majority of your listening, like you may have four other stations, but that one station gets vast majority of your listening. So we now know that those are the people that are driving the overall ratings of the station. So if you look at a first preference that's only about ten to twenty percent of the audience of the total audience, but it drives somewhere between sixty and seventy percent of the total listening for that station. So it's very asymmetric.
Bailer: So you know something about the demographics of that group.
Eldridge: Absolutely. And you know where they live.
Bailer: So if you would characterize that for our local station, what are some of the demographics of a typical public radio station listener?
Eldridge: I would say on average they're somewhere between thirty-five and fifty-five years old. There are some quite a bit younger like your son that…twenty-five when he discovered his favorite personality and then there are some that are older too but you know, kind of the bell curve is in that thirty-five to fifty-five. They tend to be a mix of male and female almost perfectly and they tend to be college educated. And they typically you know have a household income that's above average so it's a very you know it's a very affluent audience and a very…again, it's not…most stations have a tighter, you know, sort of core you know this is forty five to fifty five or twenty five to thirty four or something like that whereas W.V.X.U. and public radio in general has a little bit broader…country radio oddly enough also has a very broad age range as well so there are a couple formats like that.
Campbell: Is it still true, you know why talk radio has the biggest ten step the biggest audience overall today, I think when you travel in a car in the old days, all the default station was always a country radio station. You go through small towns and you have to listen to country radio is that still the case today?
Eldridge: I believe…
Campbell: …small communities?
Eldridge: I believe, I mean the country radio is kind of America's out there rural leader.
Campbell: Very interesting.
Bailer: Well, OK.
Eldridge: I have to confess I enjoy it as well.
Bailer: This is great. Where do you see the future in terms of both listening, but also measuring and understanding the consumption of radio?
Eldridge: You know I think that you know, Arbitron and then when Arbitron sold to Nielsen, they created these meters that listen for these inaudible tones and that's how they're…you know, your dogs can hear this but you can't hear these, you know sort of audio marks that help you to know that this is the station that's you know W.V.X.U. So every station is transmitting an inaudible tone. Yes it sounds big brother-ish but that's that watermark or that audio mark is what's picked up by the meters in its aural based so it's long as you can hear it the meter can pick it up and then they use that information to form OK What was he or she listening at that moment and then they build the ratings based on that. I think it's actually one of the reasons Nielsen bought Arbitron was so they could do that for other audio sources, out of home T.V., you know, streaming, podcasting anywhere you can insert a unique code, inaudible code those meters can pick it up. So that could be the future. There's also a lot of other you know data right now like with Google T.V. If you have Google T.V. you're opting in to having Nielsen collect that data based on what your phone is tagged in.
Campbell: Does phone ratings have the same, you know, when they started the people meter on television and you would walk into a room a lot of times the curtains would be waving or dog would walk in the room and I would do it is there are something in there?
Eldridge: No, not that I know at least there's nothing that has that kind of similar quality.
Campbell: Very good. Tripp thanks, that's all the time we have for in our conversation today, we really appreciate you joining us today. Stats and Stories is a partnership between Miami University's departments of Statistics and Media, Journalism and Film and the American Statistical Association. Stay tuned and keep following us on Twitter Apple podcast, if you'd like to share your thoughts on our program, send your e-mail to firstname.lastname@example.org and be sure to listen for future editions of Stats and Stories, where we discuss the statistics behind the stories and the stories behind the statistics.