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.

Your Wildest Streams - Part 4

Now that AOL and CBS Radio have hooked up in what CEO Dan Mason says is a merger that "has instantly doubled our daily audience of listeners," it's another victory for strong brands.  For years, AOL has offered generic streaming radio stations that were as exciting as wallpaper.  Now with 150 CBS Radio stations to choose from, AOL-goers can actually find a better radio listening experience - or can easily find a radio station they've heard from during their travels around the U.S.

The player (shown below) is nice looking, and provides album art in-sync with what's playing, the chance to rate and/or buy the song (or the album), as well as designate the station as a pre-set or share it with someone else.  On the left is a list of the CBS stations available.  Of course, there are no fewer than 8 Jack-FM stations on the list, and it's not always easy to find a station that you're searching for.  (Maybe list them out by markets - or at least offer that as an option, so the user can look through NYC stations, for example.)  The stream sounds good technically, and as we've discussed in this space, that's not always the case.

Overall, this is another indicator that big streaming brands will easily best "generic radio stations."  With its personalities, production, and elements that you could only get from a real radio station, this plan should be a big winner for both AOL and CBS, especially if it can generate significant web revenue.

CBS is positioning its terrestrial radio stations for the future by offering them up to a much larger web audience.  This bodes well for traditional broadcast companies as they seek out smart alliances moving forward.

Competing Against Everyone

There was a time only a decade or so ago in Rock Radio where we had it all to ourselves.  We controlled our music and our pop culture.  Sure, some of Rock's featured bands would appear on Saturday Night Live, and there was always the competition from MTV.  But for the most part, if you worked for a big Rock or Alternative station - even in a smaller market - you controlled the agenda for how music and concerts were exposed and promoted.

Today, you're competing with virtually everyone.  Wherever you look - on and off the Internet - Rock is being marketed in a multitude of different arenas and venues - and I'm not just talking concerts.  NPR does a better job of interviewing our bands and marketing our core product than we do.  Case in point - a Raconteurs concert that was recently broadcast via NPR.org.  And it seems like every week, "Fresh Air's" Terry Gross or their big news magazines feature interviews and music from artists as diverse as Springsteen and Coldplay.

Of course, Internet sources from iTunes to Pandora expose new music and provide information, background, and free samples.  Artists have their own websites, enabling them to independently market their own music and merchandise - without radio's help.  And fan sites are abundant with their own homegrown coverage of their favorite bands.  In response, most radio station websites provide bare bones music coverage, opting instead to hype station contests and events.

And last week in USA Today came this featured question:  "What's your most treasured concert T-shirt ever?"  That's a fun, highly relatable question that is sure to spawn many listener photo entries.  It's a great example of letting listeners get in on the act, sharing their emotion and energy in a highly visible place.  It's the essence of CGM - consumer-generated marketing.

And it's something that we should have thought of first.

Too often, if you ask a programmer who he's competing against, he tells you it's Q96 or Eagle 94 or Rock 107.9.  But that's the narrow, "too close to the trees" answer that has hurt radio and caused more of the myopia that stunts our business.  In the real world, Clear Channel isn't competing with CBS, and Citadel isn't going at it with Cumulus.  In reality, the radio company you're working for is up against Apple, The New York Times, MSN, Amazon, Starbucks, and Electronic Arts.

The pop culture/media stage has expanded exponentially.  But too often, Radio is content to sit in its little corner in the back of the room.  And that makes no sense if you consider that in a recent month in New York radio, PPM tells us there are 20 stations with weekly cumes over a million people, and 6 stations topping the 3 million mark.  In a Philly PPM month, 6 or 7 stations have cume audiences above a million.  That's a lot of people still being impacted by radio programming, and it provides the industry with a big pulpit for delivering entertainment and information.

The challenge of reimagining, reshaping, and fulfilling our future is immense.  Yet, if we're going to be players in this new game, we need to answer that difficult question: "What's the digital strategy?"

A JacoBlog Quiz

Take a good look at the three pictures, and guess which one is the pirate:

If you picked "C," you're on the same page as musicFIRST spokesperson, Martin Machowsky, who was quoted as saying that broadcasting music without payment is "a form of piracy."

So, first the RIAA goes after 14 year-olds who download music.  Now, radio is a form of piracy?

These guys are getting more desperate and illogical by the day.

AAARRRGGGHHH!!!!

No Limits

Struggling Chrysler is trying to do just about anything to get your attention - and to stimulate you to buy their vehicles.  The offer of $2.99 gas, while appealing on a very basic economic level, is apparently not moving cars and trucks off the lots.

But in all their new '09 vehicles, wireless Internet may be a motivator for some adventurous buyers.  It's a platform called UConnect Web, and it opens up the Internet to consumers on the road.  For radio people, it's the inevitable announcement that all content in cars is fair game.  And it's coming to Chrysler showrooms in September.

According to Keefe Leung, a Chrysler engineer for this initiative, "There are no limitations in content."

That's a quote that should be posted in cubicles and offices throughout our industry.  The excuses for not streaming or for offering a substandard stream are coming to a swift end.  Radio is in a great position to brand and market its streams because as mobile WiFi becomes as ubiquitous as wireless laptops, there will be no limits on access.  The best known brands in local markets - KLOS, KBCO, WRIF, WMMR, KQRS - will have a decided edge.  But only if radio realizes what's at stake and steps up.

D'oh! Online Communities & Your Station

Here's a revolutionary announcement - Fox is aggregating a group of 2,000 loyal viewers and "giving them a seat at the table in the decision-making process," according to Melva Benoit, a senior VP of audience intelligence with the network.  Holy NeoRadio!

Of course, many radio stations have been engaging listeners via email databases for years now, but the Fox announcement lends more credence to the wisdom of using the audience to help guide programming, promotions, website, and marketing decisions.  Fox notes that it plans to use its "community" as another voice beyond perceptual research and focus groups.

This is exactly how radio should be shaping its future.  As we've seen with our Tech Polls, Listener Advisory Board groups, and other tools, our email databases are a fountain of information and feedback from loyal, caring listeners.

In many ways, radio has been ahead of its curve, but simply hasn't formally tapped into this resource, partially because it's so different from traditional research studies.  Many radio stations have larger and more vital databases than most cable television networks.  It's just a matter of putting together a program, and staying with it.

Even Homer Simpson could tell you that.

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.

When Waterfalls Go Up - Part 2

In yesterday's blog, we talked about how the automakers may need to pay more attention to teens in order to better understand how consumers will eventually use dashboard media.

Too bad that radio never took that advice.  A new study from Coleman Insights indicates that we're at a techno "tipping point" when it comes to teens and the ways they use new gadgets and media to access and enjoy music.

Of course, that's what our "Bedroom Project" was all about, and many of you remember those storytelling videos.  But Jon's research inspired me to go back to our most recent Tech Poll, and just focus on those who are under 18.  It's a sample of nearly 500 young Rock listeners, and their tech reality differs greatly from their older counterparts.

>Click for larger view<

Here's how to read this Media Usage Pyramid.  The pyramid is constructed in the same order as the total sample, so when you see various dimensions "widen," it's a deviation from the norm.  So, at the very bottom, 85% of our teens own their own cell phone, while only 81% listen to the radio at least an hour a day.  That radio listening percentage is lower than for any other age group, and it speaks to the phenomenon that Jon reports in his study.  (TV viewing is also on the low side.)

But check out Internet use (at least one hour/day).  It's at 93% and leads all other activities/media.  We also have exceptionally high numbers for iPod/mp3 player ownership (87%), video streaming and social networking site usage (both with 80%), and of course, lots of text messaging (61%).  But between the Internet, iPods, sharing music and thoughts on MySpace and Facebook, and using texting as a conduit to friends, these teens are on very different platforms than many adults.

Bottom line?  It doesn't look like the 25-54 data at all.  And that's the point.  Radio's been talking to aging audiences to determine the status quo for at least two decades - instead of talking to the tech movers and shakers - teens - and attempting to understand what's next.  Studying those waterfalls heading upward would be a smart investment in time and money for a medium that's struggling to get its mojo back.

When Waterfalls Go Up - Part 1

As technology moves at lightning speed, it is increasingly difficult for radio companies (and all businesses) to track and respond to it - much less get ahead of it.  When you consider that iPods, Google, YouTube, and MySpace have only been around a few short years, it can be mind-boggling to even think about what we'll all being doing in 2010.

But that's precisely what we're paid to do.  Because as radio has learned - the hard way - continuing the same repetitive motions leads to stagnation, and ultimately being usurped by new media, and perceptions that we've become passé.

So how do we keep up with what's next?  Well, the auto companies are grappling with the same issues.  Finally, cassette decks in dashboards are vanishing.  But do consumers want satellite radios, HD radios, GPS systems, or wireless communications systems?

Tom Steenman, VP of Intel's digital enterprise group puts it this way: 

"It will waterfall up instead of down."

That is, in-car technology is something that young consumers "get" and appreciate, so car makers would be smart to load up affordable cars with the latest gadgets and services.  "It is evolving rapidly, Steenman said.  "The car is becoming the next frontier."  Eventually, telematics (as the automotive business calls it) will work its way up to older demos who have more money to spend.

From our Tech Polls and the Arbitron "Bedroom Project" ethnographic study we conducted last year, that logic rings true.  If you want to know what you'll be doing a few years from now, talk to a few 14 year-olds.  One of our "Bedroom" respondents told us "Email is for old people," and that finding made us stop and think about the differences between adults and teens.

A few years ago, I remember watching my tween-aged daughter IMing seven of her friends simultaneously.  At the time, I wondered who in their right mind would do this, and why she wouldn't just pick up our landline phone and call them all.  A couple of years later, I found myself IMing my co-workers two doors down the hall.  And who needs a landline?

The same might be said for social networking sites, blogs, cell phone texting, and many of the other tech trends that have taken societal hold in the past few years.  They start with youth and "waterfall up."  Radio has all but lost the teen audience, and technology mixed with corporate denial and arrogance ("Where else are they going to go?) have been the culprits.  But it doesn't have to be that way.  Teens will tell you what they want - and don't want - and their preferences are "techno-omens" about what's to come.

Tomorrow, we'll look at teens and Tech, along with Jon Coleman's new study about how we're at the techno "tipping point" when it comes to young people and music consumption.