JacoBlog - Jacobs Media's Blog

Now, This Word From Our Sponsor

As "old media" advertising dollars continue to head south, we keep reading about new money chasing texting, social networking, podcasts, and the like.  Radio reps are running out of people to take to lunch.

But amidst these declines, sponsorships for concerts and tours have grown 75% since '03, according to IEG, a company that keeps track of sponsor spending.  Why?  Because concerts offer a consumer experience, and not just a spot schedule.  You get music fans out of their homes and offices enjoying a couple of brewskis at a fun event - a perfect venue (no pun intended) to make positive brand impressions.

And oftentimes, sponsors are going after the listeners that Rock stations are famous for aggregating - men with entertainment dollars to spend.  Kia is now the lead advertiser of the Van's Warped Tour, while Sweet Leaf Tea gears the brunt of its ad budget toward sponsorships of festivals like Lollapalooza and Coachella.  As their CEO, Clayton Christopher, notes, "That's our marketing strategy, to introduce people to our brand at a place where they are having a good time."

For Rock stations - from Alternative to Classic Rock - the concert vibe has always been a major part of the musical experience.  And whether it's shows like KROQ is famous for, the many EdgeFest type all-day extravaganzas, or Classic-based shows like KSAN's "Bone Bash," stations have the ability to provide advertisers with a unique, grassroots marketing vehicle.  This is also the case for local showcases, like MMR's "Local Shots Live," or WCSX's "Rockin' On The Riverfront" series here in Detroit.

The marriage of radio and Rock concerts has never been better (despite the RIAA's insipid claims that radio airplay and support don't contribute much to music sales or artist brand development).   As has always been the case, radio can help put butts in seats, while also serve as a great vehicle for advertisers looking for alternative ways to build their brands.  Rock on.

Webb-T-D-A

Mark Ramsey and I aren't always on the same page, but we noticed the same piece in Inside Radio's "INsight" column, written by Bonneville's New Media Director, James Webb.

Urging stations to stop thinking about cumers as listeners, but as users was the highlight of Webb's piece.  And as importantly, he asked, "Why is radio so late to the New Media party?"

That's the question.  And the answer is a combination of denial, fear, and "that's the way we've always done it." 

If you've worked in radio more than a couple of decades (which probably describes 90% of the industry), you were conditioned to think about attracting listeners, broadcasting to the masses, and a top-down mentality.  We broadcast - you listen.

Webb also notes that our metrics are changing but many in radio haven't gotten the memo (email).  As he points out, it's about the size of the web audience (uniques), what we know about them and how we connect with them (the database), and their propensity to come back to the site for more (return visits). 

In many ways, it is similar to the "old way" of attracting an audience, and most radio programmers and managers could easily make the transition - if they were focused on achieving these goals.

And that's the reason why our W.T.D.A. campaign was developed.  As a programmer mentioned to me after receiving his green bracelet, it's a modern-day string around your finger.  And of course, that's the point.  We need a constant reminder that radio's role - and our own jobs within the business - are changing.  For every challenge, there's an opportunity. 

Connections

Speaking of "Radio's Hot New Team," which that we talked about last week, one of my favorite quotes of the year came from Jeff Haley, CEO of the RAB:

"Let's agree here and now that our goal will be to have radio on every mobile phone, PDA, and MP3 player in the next five years.  On-air, online, on-site, and on-demand, radio must be anywhere and everywhere there is a speaker or headphones."

And it couldn't come any sooner, because as we see in our Tech Poll IV, more and more radio listeners are using the many technologies and gadgets at their disposal.

Plus, the competition isn't resting.  XM announced recently that BlackBerry customers can subscribe to 20 channels.  Of course, they're charging $7.99/month for the privilege, so we wish them good luck with this venture.

But it underscores the urgent challenge facing broadcast radio operators in their quest to spread their content to other devices.  Haley's heart is in the right place, but the industry will need to move quickly in order to keep up with the Karmazins.

Eliot Spitzer Gives Back to Radio

Many have complained about Eliot Spitzer's vendetta against radio.  Today on the Arbitron PPM webinar, it was revealed that the Spitzer news translated into considerably higher ratings for both New York City all-news stations.  The Karma Train does it again.

Be Like Hillary

The big news from the Democratic campaign wars in Pennsylvania this week was Sen. Hillary Clinton's 10 point victory over Sen. Barack Obama.  But in the past couple of days, a story that was just as big surrounded Hillary's quick ability to raise a lot of money in a very short period of time.  In just 24 hours, an estimated $10 million in contributions were generated from her website.

How did she do it?  Simple:  one thought per break.

She didn't say, "Visit HillaryClinton.com.  There you'll find a whole list of my speeches, where I'm going to be appearing in the next couple weeks, some cool videos I've posted, my blog, how you can buy my hats and shirts, and where you can send me money to keep my campaign flush with money."

She did say, "Go to HillaryClinton.com right now and send me money to keep the momentum going."

And she built an opening splash page that simply and effectively tells you all you need to know.  The message is simple:  "Send in $5 (or more)."

That's why when you hear stations talk about their websites on the air, it's typically "kitchen sink" promos, mentioning many different features about the site.  Radio is immensely effective at driving listeners to its sites (or any sites, for that matter), but the old "one thought per break" rule is often broken.

What is it you want users to do when they visit your site?  Are you selling tickets to your festival, encouraging them to stream the station at work, or are you marketing your podcasts?   You can't do all three with the same promos.

Just like Hillary, you'll be more effective when you focus on one main mission with your on-air marketing.  And unlike the ratings, using analytics to measure page views and site traffic will provide you with all the proof you need.

All The News Not Fit To Print

There's no question that it's hard to find good news in the radio trades these days, as well as in the general media about our business.  Declining revenues, competitive challenges, and the exodus of great talent have conspired to create a drumbeat of negative news that drowns out some of the good things happening in our business.

That's why the incessant trade coverage about the mud wrestling between Clear Channel and its bankers has become fatiguing.  While this may be an important issue for CCU employees, it's not about them.  It's about who is going to walk away with billions of dollars from the sale.  And frankly, enough already.

Like the old Saturday Night Live bit - "Generalissimo Francisco Franco is still dead" - the fact that this deal has not closed is beyond old news.  It's tired, redundant, and threatens to continue for months.  When you're in the Texas courts, there may be no end in sight.

Clear Channel has been at the epicenter of the perceptual problems our industry has suffered from since the onset of consolidation.  Voice tracking, collective contesting, Less Is More, and the litany of dirty tricks has sullied radio's image in the media world and with consumers.  The list goes on, and while CCU isn't responsible for every problem radio faces in 2008, they're the biggest dog in the game, so they bear the most responsibility.

The new book about Clear Channel (yes, the "unauthorized" one), Right of the Dial by Alec Foege, tells the story that many in radio have known about for years.  According to Foege recently in the New York Times, "I was not out to do a hatchet job, but rather to get to the bottom of a company that I suspected had gotten a raw deal as its bad publicity had snowballed... Having spent a lot of time talking to some of the company's most prominent critics, as well as some of its most devout supporters, I have concluded that Clear Channel is indeed to blame for much of what it has been accused of."

So R&R, RBR, FMQB, Inside Radio, AllAccess, Radio-Info, and the rest - stop with the coverage of something that's destined to do two things - keep Clear Channel on the familiar road of further damaging radio's image, and line the pockets of the lawyers and the people at the top.  There has to be better news about radio that's worthy of your coverage and column inches.

Radio's Hot New Team

No, it's not a morning show in Atlanta on an Active Rock station, nor is it the new talk show in Cleveland. 

But radio's newest team, Rehr & Haley, may be the medium's best bet for a reimagined future.

At the recent NAB Convention, CEO David Rehr and RAB leader Jeff Haley worked together to deliver a positive message to the industry.  The "Radio Heard Here" campaign is an effort to remind America (and its advertisers) that our medium is a valuable and ubiquitous form of entertainment.  Rehr noted that "The sleeping giant has awakened," while Haley referred to "a renaissance in radio with respect to programming."

While the more cynical will look at this campaign as a lot of hot air, the fact is that radio needs champions and cheerleaders like Haley and Rehr.  For too long, there's been no one in a position of authority that has stepped out in a major, visible way to defend, promote, and champion this medium. 

It is too common these days for conversations among radio people to quickly deteriorate into industry bashing.  I've been guilty of this, too, because it often seems like the pressure on radio is immense, the competition daunting, and the reactions just too slow to make any difference.  We need to turn the conversation around.

And there's no better place for a new initiative than at the top of radio's most prominent associations.  We are seeing indicators as well as that some broadcasters are stepping up, facilitating more creative output, and welcoming new ideas.

Our W.T.D.A. campaign - designed to integrate our traditional medium with digital products and features - takes Seth Godin's new Meatball Sundae to heart.  Radio needs to marry its big cumes and wide reach with the technology that has captivated the country.  It can be done, but it will require that radio ownership supports Rehr and Haley's initiatives, and invests in radio's future.

Dave Beasing recently sent me a book by Dan Pink called A Whole New Mind:  Why Right-Brainers Will Rule the Future.  Its premise, according to Pink, is simple: "The future belongs to a different kind of person.  Designers, inventors, teachers, storytellers — creative and empathetic right-brain thinkers whose abilities mark the fault line between who gets ahead and who doesn't."

The Age of Consolidation is ending.  Radio needs to get back to its creative foundation.  Rock on, David and Jeff.  If there was ever a time for a positive outlook and some creative proactivity, it is right now.

Satellite Radio - What's Next?

Our Tech Poll has provided us with some fascinating insights about the satellite radio threat during the past four surveys, and this new report is no different. As reported in yesteday's New York Times "Drilling Down" feature, XM and Sirius have some challenges retaining subscribers.

In the past, we've been able to track satellite radio growth among Rock radio listeners, as well as Howard Stern's impact on Sirius.  Last year, we noted that XM and Sirius growth had stalled out.

This year's survey provides us with some great data.  Here are some headlines:

    1. The merger doesn't appear to be of great interest to non-subscribers.  For the vast majority, there is indifference or a lack of information about the coming together of XM and Sirius.

    2. Overall growth is up - from 12-13%, but interest in satellite radio among non-subscribers is at its lowest point since the first survey in '05. 

    3. As has been the case in past polls, satisfaction with Sirius is stronger than for XM.  This could be due, in part, to Howard Stern who is obviously a big reason why our Rockers opted for Sirius in the first place.

But the big takeaway from this new '08 study comes from a question we've never asked before - how subscribers became subscribers.  It turns out that while about four in ten made the choice themselves, about one-third tell us it came with the vehicle they bought or leased, while one-fifth received satellite radio as a gift.

And here's the rub - if you made the choice yourself, the odds are good you'll continue the subscription.  But if it was pre-installed in your car or truck, or it was a gift, chances are better than you're not as enamored with satellite radio.

The implications of this are important because it suggests that not all satellite radio subscribers are created equal.  And with half being introduced to XM or Sirius because it came with a car or it was a gift, these consumers are considerably shakier.

This "churn" with satellite radio continues to put pressure on a business model that has already had difficulty turning a consistent profit.  And it speaks to the ongoing challenge of keeping subscriptions plumped up, in the face of some obvious attrition.

Commercial radio has some challenges, to be sure.  But the subscription model is a tough putt, made all the more difficult by the plethora of new - and old - entertainment choices.  While many traditional broadcasters have long been concerned about the growth of satellite radio, this data suggest that our challenges are clearly coming from other sources - notably, iPods, cell phones, and the Internet.  Of course, these areas spell opportunity for broadcasters, and we'll continue to cover these topics in upcoming blogs.

Get Off The Pot

Recently, we saw more negative data about HD Radio from various surveys that have been conducted in '08.  In pretty much every study, awareness is flat, sales aren't great, and overall consumer interest is limp.

Our Tech Poll IV data is no different.  We see year-to-year awareness and sales are up just a tick.  And that's after all those ads that ran on hundreds of radio stations, and continue to this day.  Up against iPods, cool cell phones, and other hot gadgetry, HD Radio isn't even an afterthought.  It's just not on radar screens.

The difference is that our survey actually asked about the barriers to purchasing HD Radio.  The good news is that they are clear.  The bad news is that they look a lot like last year's data.  There is still a lack of clarity about HD Radio, and what it's all about.  Then there's the issue of price.  But the roadblocks that worry me the most are that most consumers haven't even heard HD Radio and/or they don't know anyone who owns one.

Clearly, this lack of buzz about the product has stopped HD Radio from making serious inroads.  You didn't buy that TiVo until you heard your friends telling you about how the box changed the way they watched TV.  You didn't make the plunge into the iPod world until you saw that guy on the plane with thousands of songs in a little device the size of a pack of cigarettes.  And you didn't throw down a couple thousand bucks for an HDTV until you walked into Best Buy that day and saw the Green Bay Packers like you've never seen them before. 

It will take consumer buzz about HD Radio content to start motivating radio listeners to run to Circuit City or anywhere else to check out and price these radios.  This is why the recent announcement that WNEW-FM is back - on HD2 in New York City - is heartening.  This is the type of programming that just might generate some word-of-mouth among New Yorkers, anxious to go back and revisit that legendary station's archives and history.  Below are a couple of promos for the new WNEW-FM HD2 channel that are truly inspirational.  In New York, this is the type of programming that might actually move some radios off the shelves.

Download WNEW HD Radio Spot #1

Download WNEW HD Radio Spot #2

We need to give these radios away, set up kiosks in high-profile retail centers (called malls), and let people experience HD Radio in markets where there's actually something worth listening to on HD2 channels.  But sampling aside, consumers aren't going to get revved about HD Radio until there's unique, buzzworthy programming worth getting excited about.  If HD Radio is going to be part of the future of our business, it needs to become a bigger priority in the present. 

Reinventing the Whopper

Burger King has provided us with a smart marketing lesson this year.  Their very successful signature burger, the Whopper, recently turned 51 years-old.

But the company is not resting on the Whopper's heritage, reputation, or laurels.  While the sandwich has always been a big hit, Burger King realizes that it's easy for consumers to take it for granted as they keep looking for the next hot restaurant or food style.

So, they've been reinventing.  You may remember that commercial campaign last year where they punked consumers in the drive-thru line by telling them they were out of Whoppers.  Customers were irked, angry, and desperate to have their Whoppers.  This was a great way to remind us all about the value of the Whopper, and its importance in the fast food pantheon.

And now, they're starting the Whopper Bar, a new concept that will bring the sandwich to food courts, strip malls, and casinos.  Looking a lot like the open style of a Starbucks, the Whopper Bar will feature chrome counters and plasma TVs (that show open flames).  And a key to this new concept is a whole new line of Whoppers, with different toppings and flavorings.

Too often, heritage radio stations get caught in the same rut that Burger King was in.  Signature events and promotions that once were exciting often become forgettable annual events that listeners appreciate, but no longer find buzzworthy.  Whether it's a concert festival, a Workforce Payroll promotion, or a morning show broadcast, the audience appreciates new spins, different features, and additional reasons to listen.

Reinvention isn't just a good idea, it's a necessity, especially in a society where "new" is the mantra, and consumers are always looking for something to talk to others about.  The good old Whopper has now been updated and relocated, and it might just become a topic of conversation more than a half century after it first came to market.

Bringing together your key staffers for a brainstorm and/or conducting a couple of L.A.B. groups are all it would take to do the same thing for a station event, promotion, or fundraiser.  How will you reinvent your station in 2008?