How would you run each of your radio stations if it was the only station you had? What format would you choose, which on air shifts would you cover live, how often would you hit the streets, what kind of on-air promotions would you do?
Having multiple stations within a market has a lot of benefits, consolidation of resources, the ability to bundle and cross-promote. But, the major downside is it almost always leads to neglecting one or two under-performing stations to shift resources to the top billing station(s).
From a purely financial standpoint this can be problematic. As we all know, there are some hard costs that are the same regardless of a station’s performance, utility bills, transmitter, tower and equipment maintenance. Plus, stations aren’t sold on potential anymore, they’re sold based on a cash flow multiple, so under-resourced and under-performing stations lower the value of the entire group.
Ratings and revenue-wise those stations leave groups vulnerable to competitors with less stations that are able to focus their on-air and promotional resources. Also, groups with multiple stations tend to be uniform on things like spot break length, website design and overall sales strategy for a whole host of good reasons. However, that gives them less flexible to tailor any of those to a specific station or format.
I’m not suggesting that groups with multiple stations in a market shouldn’t share resources where and when it’s appropriate. I’m simply suggesting that stepping back and asking ourselves how we would run each individual station if it were our only one, will lead to a better overall approach that helps to maximize the value of each individual property.
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