From cricket and concerts to podcasts and retail: the scope of iHeartRadio’s commercial moves—UPDATED

Over the last month, much of the attention attributed to iHeartRadio has rather unsurprisingly been centred on the motley crew of beer-drinking funnymen who comprise the Alternative Commentary Collective.

When news emerged of the now well-recognised caravan being banned from the stadium, most viewers expected that the unconventional commentators had crossed a line and offended someone by making a controversial comment during a match. It was almost disappointing to discover that something as innocuous as a Gatorade promotion venturing into a prohibited space caused the expulsion of the crew.

And while this has done little to stop the ACC from adding a little flavour to cricket commentary, it did highlight the important commercial role that iHeartRadio is starting to play for NZME. Previously, StopPress has covered the ACC’s promotions with Pepsi, Mainland Cheese, City Motor Group and InterIslander, but these make up only small part of the overall picture.  

When iHeartRadio first launched in New Zealand in 2013, it was initially thought that it would primarily serve as a digital platform to stream NZME’s radio stations. However, the service’s head Carolyn Luey says that it offers much more than this.

“iHeartRadio is about more than just hosting our stations; it’s very much a content platform,” she says.

In addition to hosting NZME Radio’s brands, iHeartRadio also has over 50,000 podcasts (both local and international), a host of digital-only radio stations and it recently launched in-store retail streams at Paperplus and Health 2000

These bespoke in-store radio streaming services give NZME an ongoing stream of revenue, but Luey explains that iHeartRadio can also be used on a campaign basis.

“We did a campaign with Auckland Museum last year, which was focused on one of their exhibitions,” she says. “They uploaded all their podcasts and then they encouraged people to listen to iHeartRadio as they walked around.”      

Luey explains that a major benefit of iHeartRadio is that it offers a nimbleness that previously wasn’t available through traditional broadcasting.           

“To set up a terrestrial station is tricky, but to set up a digital station targeted at a young audience, at a rock audience or at a pre-school audience is quite cost-effective, and you’re just giving your audiences more choice around what they listen to.”

This has already seen iHeartRadio set up niche channels such as the ACC, Kiwi Kids and New Zealand Top 40, and each of these additions offer new commercial opportunities for NZME clients.

“You’ve got your standard advertising inventory: banners, pre-roll and video spots,” Luey says. “Then you’ve got sponsorships, which include sponsorships for events, sponsorships of different stations (like ACC, Kiwi Kids or New Zealand Top 40) where you get your brand associated with a station and then we promote that through our channels. And then we also have branded content. So, for example, in the spot blocks on the ZM stream, you could insert branded content into the slot instead of a standard 30-second ad.”

Luey says that the introduction of iHeartRadio complements the channel-agnostic strategy that NZME increasingly employs when selling advertising.

“When we get a campaign brief we now ask: should it have print? Should it have digital? Should it have radio? Should it events? And should it have experiential? And when we talk about digital or branded content proposition, we always consider whether it should include iHeartRadio.”   

NZME is now also setting its sights on the Indian and Chinese niche markets, which are burgeoning with high immigration rates. 

“We have a partnership with Radio Tarana and we are also working on a station with on of the Chinese media companies as well,” says Luey. “So we absolutely want to get more and more different ethnicities on, and we’re also talking to a range of different broadcasters.”

Luey wouldn’t name these broadcasters or the Chinese company, saying that these deals were still being finalised.

One of the more interesting aspects of iHeartRadio’s commercial model is that it does not sell tickets for the concerts that it hosts. Thus far, theses events have been free of charge, with listeners having to enter online competitions through the platform to win tickets to attend (previous events have included Lorde, Birdy, Jessie J and Ed Sheeran).   

“Our event strategy is very much about positioning iHeartRadio beyond a digital platform as an entertainment brand. And so [concerts]are a key part of strategy in terms of builing brand awareness. And we leverage sponsors, who have similar objectives to us. So we work with them to put on these events.”

This is now continuing as the company partners with 2degrees to bring British popstar Charli XCX to New Zealand for one free show. 

But bringing acclaimed international artists to New Zealand isn’t cheap. And this when viewed in conjunction with all the investment that NZME has put into the platform means that like many other tech startups—GroupOn and Twitter included—iHeartRadio is still not profitable.

It’s moving into being profitable … [and]it’s on track to achieve its business case that was set when it was launched,” says Luey. 

However, as has been seen with the continued losses posted by other tech companies, it could be a while before the music platform shifts from the red to the green for NZME.

Correction: this story previously stated incorrectly that Pandora had not yet turned a profit. The company has in fact shifted into profitability.  

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