JacoBlog - Jacobs Media's Blog

It's The Pitts

Respected newspaper columnist Leonard Pitts, Jr. recently had an epiphany about his business and the Internet.  In a revealing column, he essentially threw in the towel over the issue of saving the newspaper industry, and said "We must blow it up instead."  If that sounds a bit like Jason Calacanis' take on radio at our Summit two years ago ("Surrender"), keep reading.

Pitts, who has not been a major fan of the Internet, now concedes that digital is the only way out for newspapers.  Consider these quotes, not just in terms of newspapers, but all traditional media that are now struggling for answers:

"We still tend to regard our Websites as ancillary to our primary mission of producing newspapers.  But I submit that our primary mission is to report and comment on the news, and that it is the newspaper itself that has become ancillary.

So maybe we should regard the Internet not as an extra thing we do, but as the core thing we do.  Maybe we should maximize the fact that we know our cities as no one else does.  Maybe we should make our Websites not simply online re-creations of our papers, but entities in their own right, destination portals for those who want news and views from and about a given city, but also for those who want to find a good doctor in that city, or apply for a job in that city or reach the leaders of that city or research the history of that city."

The only difference between his industry and ours is that they are a bit further down the same road. 

What's the digital strategy?

Email & Radio

There are times when Radio seems almost Third World in its efforts to catch up to other media, when it comes to technology and digital strategies.  But there's one area where Radio is often ahead of the curve - email databases.

At Jacobs Media, we have been fortunate to work and interact with a variety of "competitive media" in television, print, and other technologies.  And we're often shocked by how little thought is given to the strategy of amassing customer email addresses, and creating communities.

But in Radio, we've been doing it for years.  Yes, there are inefficiencies and other speed bumps along the way, but the chances are good that an FM Rock station in Colorado Springs may have a better and bigger database than many cable television channels and other media and technology entities.

That's why a new research report from Ipsos for Habeas, Inc. caught my eye.  There are a few findings that you may find interesting.

First, more than eight of ten respondents say they prefer doing business with companies that use opt-in permission to send them email.  Of course, in Radio's case, that's the method stations use to entice listeners to sign up in the first place.

Second, more than eight in ten also say that a company's reputation can be negatively impacted if it shares their email addresses with third parties.  There are stations making this mistake right now, and it can do permanent damage to their ability to ever rehab the audience relationship.  While sales should have every opportunity to make money on digital and interactive products, a line in the sand needs to be drawn when it comes to turning over a database to advertisers.

Finally, nearly nine in ten say they would like companies to give them more choices over the content and frequency of the emails they receive.  This includes advertisements, coupons and special offers, articles, etc.  This is the next step where Radio stations need to go with their databases, and it's a simple web poll/research procedure than can help determine what members of your email club actually want.  Too often, I receive station emails hyping concerts, presales, and events I have no interest in.  Get to know your database members, find out their interests, and tailor your communiqués to their interests, and the connection grows stronger.

Radio has made considerable progress with email database marketing.  Email "blasts" are getting better, and stations are gathering intelligence about the best ways to communicate with their online audiences.  Giving the database what it wants by customizing content to their interests is an important next step in creating even better relationships, loyalties, and communities.

Who's Your Tom Brokaw?

The news of Tim Russert's passing still seems unbelievable.  No one could have possibly anticipated this tragic event.  Yet, NBC News - after some in-depth, difficult meetings, to be sure - came up with a solid strategy for Meet the Press in an unprecedented election year.  They've called veteran news anchor, Tom Brokaw, out of semi-retirement to handle Russert's hosting duties, at least through the election.

And that raises the question that many radio managers and programmers should be asking:  What would you do in a similar circumstance if something tragic befell your big morning guy or team?  Is there a plan in place that would allow a station to look down the bench - or utilize other resources - in order to fill a painful gap?

Radio's talent is aging, and it seems like there's a death notice every day in R&R Today.  Aside from planning for the future, as in "Who will be the personalities of the future?", radio needs to start thinking more present tense - just in case.

The Next Radio Tsunami?

Today's guest blog comes from Paul Jacobs, who provides insight on the challenges of radio's listening audience:

Like all media, radio faces significant consumer and technology-based challenges that have been well-documented in this blog and others.  But there is a potential macro event taking place that radio requires awareness and action.  This is because a major portion of our listening base - the in-car environment - is being challenged.

We know from "The Bedroom Project" and other research that radio's stranglehold on "portability" has been compromised.  Gone are the days when listeners carried a Walkman radio around with them.  For many Americans (especially young ones), even the existence of a radio in their homes is a thing of the past.  Today, in-car listening is the last bastion of radio dominance.

But what happens when people abandon their cars and take the bus, the train, or the subway?

That's right, with gas prices above $4, a recent article in USA Today shows that mass transit ridership increased 3% in the first quarter compared with a year ago - the highest levels in 50 years.

And it's likely that a large portion of these consumers may be no longer listening to the radio on their way to and from work.

So we have two choices:  we can sit around and lament our bad fortune, or we as an industry can aggressively fight back.  In big mass transit markets, could deals be cut with Sony or other providers to purchase portable AM/FM radios and hand them out at train stations?  Can the NAB take the lead here?

Should radio buy transit advertising promoting listening to the radio while riding?

Let's not sit back and let outside forces impact our destiny.  Morning and afternoon drive is the lifeline of many of our brands, and the dayparts that traditionally drive ratings.  We have to adapt to changing conditions, and stay relevant.

(And you thought I was going to talk about iPods in cars, right?)

W.T.D.S.

I'm now thinking that the better question for radio might have been, "What's the digital strategy?"  Gordon Borrell's newest report, "Local Web Revenues," is very revealing.  Of course, local online advertising is exploding, but it's the hurting newspaper business that is garnering the lion's share of the $8.7 billion that was spent in 2007.  While print journalism is hurting, they are finding a way to attract $3.1 billion of this growing piece of revenue pie.

Now you could argue that newspapers have been in more trouble for longer.  Necessity being the mother of invention, they have made more significant and serious moves to take a hefty share of the Internet turf.  And while they are still struggling mightily as circulation figures continue to erode, they are much farther down the interactive path than any other medium.

Where's radio?  Overall, it has attracted only $189 million in '07 - a paltry percentage of the total.  As Mark Ramsey notes in a recent blog, there is indeed a lot of headroom.  But does radio still see the newspaper business in the same old light where sales managers buy the local print edition, cut out the ads, and implore the salespeople to call on these accounts?  That is so 1987.

The newspaper "threat" is that they actually have an avenue to get healthy again.  They've spent the money, the time, and invested in talent who can help them turn the Internet corner.

Where's the overriding strategy for radio that's going to earn a larger piece of this Internet business?  While just about every radio company has now hired an "Internet guy" (who in turn has hired an "Internet team"), how is radio going to seriously improve these numbers?  And are these methods being communicated to the rank-and-file that make stations go on the local level?

Back in the old days when Ries & Trout's Positioning book was the Holy Grail, stations were encouraged to develop a position, stake it out, and execute it up and down the line.  The concept was to make sure that everyone from the morning guy to the salespeople to the receptionist knew what that big umbrella position was all about.

Well, we're in that same position with digital strategies, content development, and revenue generation right now.  If you ask local programmers and managers about their company's digital strategy, many would shrug and give you a blank stare.  How are their stations supporting web content efforts?

How does video fit in, and who will create it?  How are the various departments working together to generate content and revenues?  Will there be a local online sales staff that's dedicated to selling a station's online products?

These are all key questions that point to the need for a big-time strategy and a long-term map.  While there's always been a "Wild West" quality about the Internet, a plan that everyone understands at all levels is necessary.  We're going to cover a lot of these issues at Summit 13, but the heavy lifting needs to happen inside companies, and it needs to happen soon.

No, I'm not going to make new bracelets with new initials.  Hopefully, our now-familiar W.T.D.A. green wristbands are having the necessary effect.  It's time to develop and articulate a strategic plan now.

Topical CGM

Here is a guest blog from our own Keith Cunningham enlightening us on the power of topical CGM:

While it’s not the greatest photo gallery you’ll find online, you’ve gotta give CNN some credit – they definitely get CGM.  With the passing of the legendary Bo Diddley earlier in the week, CNN sprung into action and asked their viewers (“iReporters”) to send in pictures of themselves with Bo.

The power of topical CGM is not talked about enough these days, yet TV networks (and their news programs) are getting very good at it.  And while evergreen radio campaigns like “Show Us Your Tatts” or “The Homemade Bikini Contest” have their value, topical CGM can also be very viral, if executed well.  And we urge programmers and webmasters to think “outside the radio box” and use video CGM more often.

The topical video CGM possibilities are endless, but consider the Sex & the City event this past weekend as an example.  Listeners could have sent in Vlogs (video blogs) about the movie.  Maybe its guys ranting about the flick or offering up excuses other men can use to get out of going to see it; or even groups of well-dressed women delivering excited, flirtatious reviews of the movie and teasing the men they adore.  Finally, I wonder if any morning shows took a video camera to the theater and captured the moment in their own unique way, and then posted the video on the station website.

Online revenue growth for radio will only be fueled by great content.  Therefore, it’s critical we ask ourselves W.T.D.A. ("What’s the Digital Application")?

And more often than not, some of the best answers will be found in CGM, especially topical CGM.

Got Live If You Want It

Question: How are television networks working around the TiVo problem?

Answer: By doing something that radio has done forever.

The New York Times reports that live commercials (or as we call them in radio, "live reads") are making a comeback on network TV shows.  Jimmy Kimmel (yup, a former radio guy) has done a live commercial for Quiznos (among others), and it turns out that the client is "ecstatic" with the result.

Look for TV networks to do more live commercials, because as we learned in radio with "value added," once the horse is out of the barn, it will run a long way.

But when executed well, these live reads can be good for advertisers, and not harmful to stations, programs, or jocks.  Howard Stern certainly didn't lose any ground with live commercials on his show, and advertisers like Snapple clearly benefited.  In radio, WMGC's Jim Harper and the station's sales/marketing team have been leaders in creating a special category for his "platinum" advertisers.  Not only do they get Jim's attention and great reads, but these clients who pay premium prices also receive other special treatment and services as well.

It's all in the approach, of course.  If personalities put something into these commercials - and don't just fire them off or make them sound like they're shills for their advertisers - they can actually have some entertainment value.  This is - once again - an asset that radio can leverage to put butts in seats and get bodies into retail stores, even in this lousy economy.

As I've posited in this space before, stations should consider using their top personalities to sell their own promotions and contests.  If advertisers are going to pony up extra dollars for their celebrity, credibility, and their unique presentational styles, why wouldn't their home stations want to derive some of these same benefits, rather than having Mr. Big Voice do all the reads?

At a time when radio is looking to leverage its strengths, and find greater benefit for its existing assets, perhaps more attention to putting together programs where stations, personalities, and advertisers can mutually benefit should be pursued.  It's going to work for television - and radio can do this better than anyone.

Where Less May Really Be More

You have to hand it to Fox Entertainment.  They're going to try a new experiment with two of their new television dramas this fall - fewer commercials at higher rates.  What a concept.

As Peter Liguori, chairman of Fox Entertainment, notes: "It is potentially revolutionary."

If it works, it truly will be revolutionary.  Marketed as "Remote-Free TV," the concept is designed to attract new viewers to less over-commercialized shows, while netting essentially the same revenue in the process.  Whether new viewers will be attracted to this value proposition and whether advertisers will pay extra for the privilege of running their commercials in a less cluttered environment are key questions.

Radio often debuts new stations commercial-free for a time, but then reality sets in a few weeks later.  An exception, of course, is Clear Channel's WRFF in Philadelphia, now one year-old, and still running only about 6 minutes of advertising an hour.  And Cox has long advocated running fewer commercials than most other broadcasters, too.

A lot of folks in the TV community will be watching this Fox experiment very closely.  We should, too.

High-Priced Talent

You tune in sports talk radio, and you're bound to hear that cliché debate about whether professional athletes are overpaid.  When a team is winning - like the Celtics - it's rarely much of an argument.  But when we're talking about the cellar-dwelling Miami Heat, it's a different conversation.  Consider the 2007-08 salaries of these players:

Dwane Wade            $13 million

Shawn Marion           $16.4 million

Udonis Haslem         $6 million

Alonzo Mourning       $2.7 million

Jason Williams         $8.9 million

That's a lot of green for a team that was 13-62 when this blog was written.

So when I read about a recent promotion the hapless Heat put together with their star-salaried roster, I couldn't help but be impressed.  To sell season tickets for next year (not an easy sale, to be sure), the players manned the phones at halftime of a recent game.  It was a great use of their marquis power, and a clever way to give new fans a celebrity brush with fame.  It also earned them media coverage in a number of news outlets.

Most radio stations don't use their big names as effectively.  Yes, many well-paid jocks have gotten the economic message in the past few years.  They need to make a greater contribution than their 4-5 hours shows.  As a result, many have stepped up, are spending more time at the station, while showing up for more outside events (with no talent fee).

But stations could utilize their big brands in a more compelling way.  A number of years ago, we talked about the jocks making live, unsolicited calls to members of the email database.  Imagine getting one of those out-of-the-blue calls from your favorite DJ, thanking you for listening, taking a request, and just spending a couple of minutes to schmooze with a station fan.  It's a lasting impression, very buzz-worthy, and something that can cement a listener's loyalty for years.

Additionally, it is ironic that clients often pay premium dollars for live reads by big-name jocks, but stations would rather use their anonymous Mr. Big Voice on most (if not all) key promos and positioners.  If your airstaff can effectively sell dog food, cars, and new windows for advertisers, why wouldn't you regularly use the power and influence of their voices to highlight what's really important - your station and your brand?

The sobering economic realities of radio, coupled with the rapidly changing technology environment, have forced radio programmers and managers to rethink many things.  The way we generate maximum value from our unique, proprietary personalities should be one of them.

Stop Whining!

You think it's tough out there in radio?  Imagine the vibe at the recent leadership conference held by the American Association of Advertising Agencies (or the Four A's).  From a fun convention that used to include golf and tennis tournaments to the no-nonsense "reality bites" theme that this year's get-together featured, the tone was serious and concerned.

There was a recent New York Times article full of great sound bites that should probably be echoed at newspaper conventions, music industry conventions, and this year's NAB in Austin.

Consider these pithy quotes:

Tom Carroll, president and chief executive officer of TBWA Worldwide: "It's like driving in the fog.  You're not sure what's ahead of you, but you have to keep driving."

Ben Silverman, co-chairman at the NBC Entertainment and Universal Media Studios:  He suggested that better deals and sponsorships could happen if agencies would stop asking "Am I buying media?" and ask instead "Am I buying culture?"

And finally, Lee Clow, chairman and chief creative executive at TBWA, who exhorted the crowd to "Stop whining."  He reminded convention-goers that the new realities of the advertising world "shouldn't be scary" and should instead provide "a huge opportunity for us" to become more useful to clients as they look for new ways to sell their wares.  And then finally, this:  "If you want to participate, you've got to start hiring young people.  And don't tell them what to do -ask them what to do."

Stop Whining!

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Scenes from coming attractions, to be sure.