Alternative radio pays the price for ignoring mainstream market

When they come to write the next marketing textbook someone should take a look at XFM, the London “alternative” radio station given to playing music from record labels with names like Earache.

XFM, which launched last year, is currently battling for audiences and revenue in a crowded London market with more than 20 stations, and at the same time trying to forge a distinct brand identity.

Its problems, aired at a session at last week’s Music Radio Conference in London, speak volumes about the difficulties facing new media ventures in today’s highly competitive world, and about the challenges in establishing niche brands.

XFM is without question a niche product. It first rocked London as a station broadcasting on a month-long temporary licence in 1992. Four further temporary licences and two unsuccessful bids for a permanent licence followed.

Along the way the XFM bandwagon gathered force and pace: it became an article of faith in some circles that London needed a radio station playing alternative music, and that it should be XFM. Finally, at the third time of asking, the station won a permanent licence and went on air last September – on the day after Diana died.

It hoped for an audience of 500,000 a week. Instead its first Rajar figures gave it just 234,000. That may be an under-estimate – as one conference delegate observed, many of XFM’s target listeners are students and transients, more likely to roll a spliff with a Rajar diary than fill it out – and Chris Parry, XFM’s co-founder, claims his research shows listening has gone up in recent months. But rival stations’ tracking figures suggest the reverse. Either way XFM has not been conspicuously successful in winning over listeners – or indeed advertisers, which complain it delivers neither the numbers nor the right sort of environment.

The record companies, which gave XFM considerable support in the early days, aren’t happy either. They want a station that will play some of their more marginal, less obviously commercial records, breaking new artists and promoting new music.

But to do that effectively they also want a station that thrives. And for that, according to Osman Erlap of A&M Records, the station has to broadcast more established hits and fewer “non-hits of the Eighties”; it needs a smaller playlist of records which are heard more often, to give its audience a chance to become more familiar with them; and it needs to present them more professionally.

“If you’re going to play irritating music, which alternative stations do,” Erlap told the Music Radio Conference, “the DJs and the hits will have to bail you out.”

Many think the presentation is amateurish. And as for the marketing – even Sammy Jacob, the station’s programme director and Parry’s co-founder, believes the advertising hitherto has been a mistake. Slogans like “Un-herd music”, meant to differentiate XFM from the mass of commercial stations in London, have succeeded in alienating many potential listeners, who’ve concluded that the station isn’t for them.

All this is somewhat surprising since Parry is, or was, a marketing man – albeit one whose career has taken him through the A&R department of Polydor Records to a role as a punk Svengali (he was the man who first signed the Jam, the Banshees and the Cure).

It seems Parry’s marketing sensibilities have been blunted because he’s also a fan. What the criticism of XFM boils down to is that it’s programmed by and for enthusiasts, and has failed to adjust to the fact that a permanent London-wide station needs to attract and hold a wider audience.

What worries Parry is that reaching out to that wider audience involves compromising the purity of the original concept and of the XFM brand. “There’s a danger of losing your clothes,” he told the conference. “I wouldn’t like to get to the point where we’ve got an audience but we haven’t retained brand value. To me that would be making a pig’s ear of it.”

But he also concedes there may have been mistakes. “We’re not going to be an exclusive station, up our own arse, where if anything gets too cool we’re not going to play it. If that’s what’s being suggested then I’ll give attention to it, because it’s not what we’re about. We’re about entertaining people.”

It is possible to play minority interest music on the radio and get good listening figures without compromising brand identity. Kiss FM in London proves it, which is one reason perhaps why the Music Radio Conference gave Kiss’s founder, Gordon McNamee, its annual award for outstanding contribution to music radio.

Kiss has an audience four times the size of XFM. It’s also a strong and recognisable brand. It’s succeeded in pulling off the trick of being both distinctive and popular. As McNamee’s award citation puts it: “He managed skilfully to balance the demands of his shareholders to create a successful commercial business with the philosophy and spirit of the original ‘pirate’ dance music idealism.”

Chris Parry and XFM need to learn a few lessons from Kiss FM – or risk being forced to sell out to somebody else who will do the job for them.

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