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Making The Buy

iBiquity is doing something right.  Realizing that part of the HD Radio solution is to get inexpensive, cool-looking hardware into the hands of consumers is a key factor.  Now the Insignia portable at $50 is on the market, available at Best Buy, and it's a chance to flood the market with inexpensive, portable radios.  There are lots of nice features on this Insignia unit, so to provide a little insight on the buying experience, our intrepid reporter, the Conclave's Jay Philpott made the trek to a St. Louis Best Buy.  Here's his report:

Upon reading in this morning's trade press that the first portable HD radio (the Insignia NS-HD01) was available as of today, I resolved to get one.  By early evening, I had a chance to get to my local Best Buy, and before walking in, reflected on the tales I've heard over the past few years about how uninformed the sales people at the "big box" stores were when it came to HD radio.  I braced myself for the worst, but it wasn't the central problem I experienced. 

I was happy to learn they had received 5 units, and according to the sales person, only three remained.  The question was: Where was the radio?  Although it was assigned to the "home theater" department, it wasn't stocked there... it wasn't in car audio or computers either.  

At one point I had three sales associates surfing the store computer, calling out SKU numbers and canvassing the store.  I was happy to hear that they were a bit more informed as to what the product was even if they still referred to it being a device that was "like satellite."  At least they knew it was an adjunct to FM.  Finally, the stock of radios was located in the section with mp3 players... and that makes sense, although there was no prominence in the display to alert anyone to the presence of this new product.

The Insignia is a pretty cool-looking radio, unlike some of the designs of its tabletop predecessors.  It's about half the size of an iPhone, has a nice LCD interface and pretty intuitive controls... it does not have an onboard speaker - so the only way to listen is with earbuds or headphones.  

Still, it's a nice device.  But, there is work to be done to insure that consumers won't have to endure the process I went through.  I'm not so sure that the moderately interested buyer would wait the 40 minutes I did just to get this new radio, even at the very reasonable price of $50.  And the manufacturer needs to be a bit more aggressive with the store to get shelf space and signage.

As an industry, we should support this effort with better promos than those offered by the Alliance.  They seem to be shooting more for creative writing awards than selling actual radios.  None of the ad campaigns has really done much to entice a consumer to the medium of HD Radio by extolling the virtues of the unique programming.

And as individuals in the industry, I submit we all commit to this exercise:  Pick a Best Buy in your market and go there as a normal shopper.  Inquire about this product.  See what product knowledge the sales associates possess.  If they seem to struggle with the product description, how it works, etc... help them through it.

Let the teaching and learning (and buying) begin!  An appropriate spirit since the Conclave begins this week!

That New HD Radio Campaign

OK, I'll admit it - I'm conflicted about HD Radio.  I wanted to believe in this innovation when it was first introduced, and again when the Alliance was formed.  I was involved in the front end with RIFF 2, and have always been complimentary of what a great job they've done with this HD brand.

Additionally, I have worked with the Alliance to try to bring some of radio's best and brightest together to help problem-solve the HD Radio conundrum.  And last year, our company conducted research for iBiquity, in an effort to better understand how HD Radio is positioned in the radio community, and the types of actions that would improve its situation in an increasingly difficult economic environment.

But after listening to this newest round of creative from the Alliance, and reviewing the results of our most recent Tech Poll, I can't help but grow more pessimistic about HD Radio's ability to reach the public and create demand. 

>Click here to listen to the new HD Radio Commercials<

There is no shortage of fanatical HD Radio bashers out there - and I'm sure this blog will attract every one of them.  That's not why I'm writing it. 

For the other 99.9% of radio professionals out there who want to read something positive about the business at a time when it is so easy to go negative, I have to raise the question:  Why are radio stations devoting valuable air time to ad campaigns that have no chance of successfully educating consumers, much less exciting them about HD Radio?  It's not my inventory, but we are all economically impacted by providing commercial avails to HD Radio initiatives that just aren't strategically created.

For years now, the Alliance had the opportunity to get the creative right, and this is another campaign that falls woefully short.  If they've been tested, let's see the results, but to most trained ears, these spots aren't going to create demand, educate consumers, or sell radios. 

As we love to say in radio, this isn't brain surgery.  Researching consumer attitudes and opinions about HD Radio is elementary.  Crafting commercials that can effectively address negatives, while accentuating attributes is what we've all been trained to do.  In its own rock-centric way, our Tech Polls have identified both, and they are open to the Alliance, its ad agency, and any other interested parties. 

This is not to say that selling HD Radios is an easy putt, because it's not.  The false starts, technical and retail problems, and overall lack of consumer understanding are daunting to say the least. 

But we're not going to solve those problems with cutesy commercials featuring a guy with a French accent.  Unlike the HD Radio haters, there is nothing gleeful or "I told you so" about this post.  A successful HD Radio initiative could have been a difference maker in the digital landscape, but every year that goes by, radio falls further behind. 

The Alliance - and radio - needs to do better.  The last thing radio can withstand is a visible failure at a time when buzzards are flying around traditional media.

Fly Me To The Zune

The news that Microsoft Zunes will contain HD Radio coming this fall is one of those "good news/bad news" situations.  As a radio friend of mine notes, this may be akin to radio supporting Betamax.  

No doubt about it, had the news been about HD Radio becoming standard equipment in Apple iPods, we'd all be thinking much differently.  The Zune - like much of what has come out of Microsoft in recent years - is a "me, too" device that has low awareness and minimal penetration in the marketplace.  Does it enhance radio's position to be included in these devices or is it yet another reminder that radio has fallen out of step with the consumer and favored gadgets?  It is, nonetheless, a mini-tipping point for HD Radio - a far better story than the one about the technology being adopted in Panama.  

It was also telling that many of radio's CEOs jumped on the bandwagon, and praised everyone from Microsoft to the HD Radio Alliance to iBiquity for this accomplishment.  That's all well and good, but the reality is that the commitment level to this technology - and the programming and investment in HD2 stations - has been steadily eroding.  

For radio, the Zune relationship is symbolic of the larger problem that to many we're a medium that is out-of-sync with where tastes and technology are going.  Despite Microsoft's heft in the software world, the Zune lacks awareness, cache, and buzz.  For many, this development will only reinforce the notion that radio's track record for picking partners and brands is questionable.  We continue to look and act minor league.

One of my least favorite phrases is "baby steps."  In this point in time, movement has to be rapid, precise, and laser-sharp.  For HD Radio, it's a step, but far from a big one.

They Take a Licking...

In an interesting confluence of events, a couple of often beaten up broadcast entities had a good week.  Both Arbitron and their PPM ratings, and iBiquity and their HD Radio product, each came away with a few points in the win column.

For Arbitron, it started with the Attorneys General of both New York and New Jersey settling those PPM lawsuits.  It then continued when it was announced that the MRC had accredited PPM ratings for the Riverside market.  While it seems odd that PPM passed muster in a market that no one is really focused on, it's clearly a step in the right direction for Arbitron's electronic ratings system.

Then there's iBiquity.  HD Radio had strong presence at CES in Las Vegas last week, and according to sources (OK, Buzz Knight), there were lots of people hovering around iBiquity's booth, and some upbeat car news with Hyundai now offering factory installed HD Radios.

In a sea of tough news about radio, it's interesting that two of the more embattled companies and initiatives actually had something to smile about last week.

Full disclosure:  Jacobs Media has conducted research for both Arbitron and iBiquity in the past couple of years.

iPhone Home

In this year's Jacobs Media Tech Poll, we checked iPhone ownership at 3% in February - not bad for the rollout of a new gadget.  But for Apple, the disturbing news was that only 2% of those who didn't own one said they'd be very likely to purchase an iPhone this year, while 9% reported they were somewhat likely.

While these numbers would make the HD Radio Alliance happy, they did not strike us as great, and our "take" on the iPhone situation was that Apple would have to make some changes to make the iPhone more desirable to mainstream consumers - not just gadget freaks.

And last July, they did just that.  The release of the iPhone 3G version was indeed the "game changer" that Apple claims it to be.  There's a buzz on iPhones, and it runs much deeper than "early adopters."  Consider that in these difficult economic times, the one smartphone that companies are now gravitating toward is the iPhone, while there are down arrows for Palm phones and Blackberrys.

There are now 10 million iPhones across America, and Apple's share of the smartphone category is moving up quickly - in this lousy economy.

Why the change?  First, iPhone marketing is simple and attractive - it makes you want to go out and buy one.  In just a 30-second spot, you can see how the device works.

Second, the iPhone has lived up to its advertised "game changer" claim.  The Apple Store is loaded with cool applications that's either inexpensive or free.  You feel like a kid in a candy store when you browse through the various new apps, and of course, they are continually updated as new programs are created.

And third, opening up software development to the world and taking advantage of the ingenuity of geniuses everywhere was genius itself.  Apple has tapped into the ultimate form of consumer-generated content.  The potential of great new apps is unlimited, and each one generates its own form of buzz - apart from the device itself.  ("Hey, check out this new app I just downloaded on my iPhone.")

This viral component is the key to the iPhone's growth and proliferation, because Apple is more than content with outsiders now being the buzz engine for its gadget.  In the same way that we've seen radio stations benefit from the creativity of its audience, the iPhone is deriving the benefits - word-of-mouth and revenue - from its smart users and crafty software designers.

As the RAB's Jeff Haley announced at his annual meetings back in February, "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."

Based on Apple's progress with the iPhone, we'd be smart to accelerate that plan.

The Digital Countdown Clock

  With less than 200 days until the television we know and love goes all-digital, it is becoming clear that the conversion campaign has worked.  Are there still older people who don't get it and are panicked about the changeover?  Of course.  But in the main, the Digital Transition Coalition has done a masterful job of educating America about the switch from analog to digital.

The keyword here is "education."  As a recent NAB poll indicates, 90% of America knows about the coming digital reality.  And consumers are buying digital boxes in order to make sure they're ready for the big day.

Contrast that with HD Radio.  Awareness is nowhere near 90%.  In fact, studies that have measured HD Radio familiarity are probably inflated because every shred of research that we've seen and/or conducted indicates that while many consumers say they know about HD Radio, their knowledge depth is mediocre.  If you don't believe me, take your own survey the next time you visit a fast food restaurant, attend your kid's baseball game, or hang out at a barbeque this summer.

And this is the case after the incredible tonnage of commercials that have been run by HD Radio Alliance members.  After all this time, do consumers really "get" HD Radio, and as importantly, are they motivated to buy one?  And if they are, what happens when they get to Best Buy or Circuit City?

The conversion to digital television illustrates both the enormity of the task, as well as the scope of their success.  This is not an easy process, and HD Radio has felt the fits and starts that go with unleashing a new technology.  There's hardware, distribution, marketing, and last but not least, content.  All of these key components have to be working in unison in order to have the desired impact.   But maybe creating an "end date" for analog was the key to television reaching its daunting goal.

What would happen if all analog radio was to disappear on 1/1/2010?  Would it be the end of radio as we know it?  Or would it be the beginning?

Disclosure:  We conduct research on a project basis for iBiquity.

A Good Day For HD Radio

On Tuesday, USA Today featured several articles on HD Radio in both their Money and Life sections.  For a media moment, HD Radio appeared to be on an equal footing with iPods, hot new phones, and other media gadgets.

But when you study the various articles, the source of the buzz is HD Radio content.  This included Emmis/Austin's "Local 107.1," WAMU's hot bluegrass channel, the WNEW-FM channel in New York, Clear Channel's eRockster, and other cool experiments and initiatives that USA Today highlighted.

What does that tell us about consumer acceptance and enthusiasm?   If HD Radio is going to be successful, it needs distribution and radio listeners need to understand what it's about.

But as we've been saying for some time now - and many clearly agree - HD Radio will grow if it creates programming content that motivates consumers to want to have it - in their homes, cars, and offices.

That's why people bought FM converters in 1970.

Full disclosure:  We do research work for iBiquity.

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. 

A Good Idea

Every time I post a blog about HD Radio, I just sit back and wait for the predictable deluge of negative comments - typically from the same people.  There's no doubt that many in our industry have become understandably disenchanted with HD Radio, seeing whatever potential and promise it once had now being jettisoned to the industry's backburner.

And many have legitimate gripes and concerns.  After the HD Radio ad campaign controversy from late last year, Peter Ferrara wisely put together the "HD Radio Idea Summit." I was invited, I attended, and I participated.  It was a healthy vent session, followed up by a constructive brainstorm that may have yielded several solid ideas.  If nothing else, many Alliance members went back home to their respective companies, and hopefully started pushing for some change, some investment, and some attention for HD Radio.

In these sessions, some of the creative folks from the Alliance's ad agency, GSD&M, were on hand to discuss the controversial "It's Your Radio" campaign, and to look for input for the next flight of spots.  This is where the "Upgrade" concept was conceptualized, and most participants concurred that it's an improvement over "Discover It."

My sense of this session - which I suggested in a blog last December - was that it was a start, but something that should have occurred a year or more ago.  There are great minds in this business, and if the HD Alliance is to successfully manage this difficult project, it's going to need creativity, input, and help from more than just the usual suspects.

That's why I got excited when I received a new HD Radio commercial campaign in my email last week.  It didn't come from the Alliance nor was it dreamed up by a big agency or even by a committee of esteemed radio broadcasters.  Instead, it came out of the production studio of Bonneville/St. Louis.  Cooked up by commercial production director, Brian Hartmann, it's clearly an improvement over the original campaign because it positions HD Radio as a positive upgrade.  Instead of a replacement for your old tired radio, HD Radio is presented as a complement to AM/FM.  You can check out one of Brian's spots here:

Click Here To Dowload The MP3 File

How many other Brian Hartmanns are out there, eager, ready and willing to make HD Radio work?  How many programmers at the local level have exciting ideas about how to program HD2 channels that might just sell some radios?  At the "Idea Summit," we heard from CBS' Dave Robbins talking about his company's HD2 plans.  Energized by Dan Mason's initiative to do something breakthrough with HD2 channels, the company is embarking on several new concepts - including Amp (a channel for pre-teen girls).

The "Idea Summit" was a start, but if HD Radio is to become viable, the Alliance and its members need to look no further than some of the talented people inside AM and FM stations who are teeming with ideas, innovations, and content that could lead to success.  There needs to be an atmosphere of innovation, experimentation, and entrepreneurship that is so often missing from broadcast radio today.

Thanks to Brian Hartmann, who took the initiative by sending his idea to iBiquity, and getting the ball rolling.  It's a start.

"It Ain't The Meat...

...It's The Motion."  OK, maybe I'm one of the few who remembers that song from Maria Maldaur from the early '70s.  But as the CES is the big story of the week, those lyrics ring true.  Of course, the CES is all about the newest gadgets...or is it?

The more you talk to key players in the media/technology field, the more it continues to come back to software...content...programming...yes, the motion.  It's not just about the toys - it's about what you do with them.

And that's the theme we're hearing again and again out of CES.  In a recent LA Times piece, Beth Comstock, NBC Universal's president of integrated media, notes: "You can't talk about great tech without great content.  That's what led us to this year saying we need to have a presence.  We want to be in the middle of all these conversations."

Jonathan Shambroom, a senior vice president at Crackle, Inc. (an online video site acquired by Sony in '06) underscores that point:  "For a long time, the line between content and hardware has been blurring.  Traditionally, CES has been about hardware.  Now content is really driving a lot of the technology."

And it dovetails into the HD Radio challenge.  Yes, the hardware offerings are clearly proliferating and becoming more compelling.  But is broadcast radio stepping up with the content that will truly drive equipment sales?

Check out the latest happenings from the CES with Engadget & CNET.