Monday, May 05, 2008

Will the 1-in-10 Myth Ever Go Away?

It might be the most popular statistic in all of public radio – that just 1 in 10 listeners donate money.

And it’s wrong.

Dispelling the 1-in-10 myth is essential to understanding public radio’s current business model and figuring out how to adapt to a changing media environment. It could prove very costly if new business models for public radio are built on the assumption public radio stations are lousy at converting listeners to givers.

Most stations are already doing a much better job at getting donors than indicated by the 1-in-10 Cosmetric.* Unfortunately the myth is perpetuated through bad math. Most people arrive at the 1 in 10 number by dividing the number of annual donors to a station by the number of weekly listeners to the station. There are several problems with this approach.

One is that two or more people living in a household tend to contribute as one giver. They count as two people in the weekly audience but as just one donor in the 1-in-10 math. An Audience 98 report accounted for household giving and found the ratio to be more like 1 in 5 weekly listeners was a current giver.

That’s current givers. Nationally there’s about a 40% annual churn rate among donors. Over a several year span it’s easy to see where 30% to 40% of all weekly listeners would have given to public radio at least once, even when considering the churn of the weekly audience.

The 1-in-10 number suggests that public radio stations are lousy at converting listeners to givers... or that most listeners are cheapskates. Neither is true. While there’s always room for improvement, stations are doing a good job of getting core listeners to give. The challenge is to get listeners to give more frequently. The first step in that direction is letting go of the 1-in-10 myth.

* Cosmetrics are numbers that look like meaningful statistics even though they have no real value.

Labels: , , ,