Paul Jacobs jumps back in today for some thoughts on advertising - and how it impacts radio:
It's hard to tell whether it's a big deal or someone representing Generation X has hired a PR firm, but this past Sunday, articles appeared in the New York Times and our local paper touting the fact that the "slacker" generation has just turned 40. This comes on the heels of articles that appeared earlier this year announcing the first baby boomer turned 60.
The press loves to write about these "milestones," but it always makes me wonder if they've been able to identify who the first baby boomer (or GenXer) is. If not, how would they know when the first person in a generation crosses into a new decade?
Anyway, what's significant here is that while the press is the first to recognize the changes that accompany generations as they age, advertisers lag behind. For the past 10+ years, I've been visiting with advertisers on behalf of our Alternative and Active Rock clients, attempting to get them to recognize the fact that GenX has value, is married (60%), has children (50%), owns homes (55%), and are well worth targeting. Of course, they look a bit different (body art), listen to different music, and are motivated by different advertising methods. Thus, advertisers tend to shy away from them. It's too hard to change, at least when it comes to buying radio.
It's a great pitch, and when I'm done, we are usually able to alter the thinking of several clients. Logic and reason occasionally work in advertising sales. Of course, the rest of the clients go back to their agencies, climb back into their shells, and return to the same, myopic media buying tactics of the past. Youth-targeted radio stations are fighting for a disproportionatly small percentage of revenue, and as a result, face significant financial hurdles, and as we saw earlier this year with high-profile Alternative stations, many disappear.
I can see the same thing happening now to radio formats that target aging baby boomers. It's unbelievable to me that advertisers who've been targeting boomers for decades suddently abandon them as their customers move past 50, on the false assumption that they don't try new products (among other things). This is patently ridiculous. As baby boomers move past 50, their kids leave the nest, and their disposable income rises significantly. 39% of America is over 50. Yet the 50+ markets buy half of all new automobiles. And advertisers are abondoning them?
The predictable result is that radio formats that target the 50+ market are rare, and under the same type of financial pressure as youth-based formats. Oldies formats are becoming Jack. We're beginning to hear questions from Classic Rock clients about what's going to happen to them as their audience ages. And of course, when was the last time you heard of a substantial new format targeting 50+?
We've written before in this space that radio is in danger of violating the definition of being a "mass market" medium by abandoning youth, and now abandoning aging boomers. Yet, there are significant advertising dollars that target youth (and I believe, will soon target aging boomers). The problem is that as radio has abandoned youth formats, the money has moved elsewhere. Just turn on MTV, pick up a Teen People, or watch "The OC."
What's scary is that we're not abandoning these audiences because of lack of listener interest. We're doing this because we can't sell them. Sad indeed.