Selling like hot radio receivers

Your media analysis on digital radio (MW last week) was spot on in its assessment of the potential of DAB for advertisers, and the need for Rajar measurement of digital radio stations to demonstrate broadcaster confidence in the medium.

I do, however, take issue with Mark Helm of MediaVest in his evaluation of the new DAB products due on the market this year. Helm is apparently sceptical of the impact on consumers of such revolutionary features as rewind and pause, and of the expansion of the range from manufacturers such as Roberts, Bush, Pure, Ministry of Sound and others. “They are unlikely to sell well because they are too expensive,” he says.

The average price of a digital radio this year is well under £200, and the least expensive is just £99. Forty years ago, when FM trannies arrived, people queued to pay between £10 and £20 for them, a price that equates to between £100 and £200 today. Research conducted by the Digital Radio Development Bureau (DRDB) shows that 39 per cent of potential DAB consumers are prepared to pay up to £100 for a radio, and 55 per cent would pay more than £100. Four months after the Christmas rush, John Lewis still has a waiting list of thousands for the Evoke-1 digital radio (£99) and the product is selling at Dixons, Comet, Argos and so on as fast as it goes into the stores. This is music to the ears of retailers who, since the advent of FM, have had nothing innovative with which to engage radio customers. Instead of almost giving away cheap radios, suddenly they have new products for which consumers are prepared to pay a premium.

Consumers catch on fast and, make no mistake, they have caught on to digital radio. The DRDB conservatively predicts penetration figures for DAB products will be 500,000 by the end of this year, and 1 million by the end of 2004. That’s not a scenario inspired by scepticism.

Ian Dickens

Chief executive

DRDB

London W1

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