Fred Jacobs is President of Jacobs Media, a media research and consulting firm. Jacobs Media clients have included CBS Radio, Premiere Radio Networks, Citadel, Greater Media, MTV Networks, Playboy, Amazon, Electronic Arts, NPR, Sylvan Learning Centers, and Taubman Malls. Learn more about the company here.
The Bones At A Barbeque
A couple of weeks ago, an old friend and former client, Bob Ottaway, sent me an insightful analysis by Terry Teachout that appeared in the Wall Street Journal. Titled “The New-Media Crisis of 1949,” it told the story of how network radio’s failure to adapt to television serves as an allegory to radio’s current-day struggle to deal with the invasion of digital media.
Also, Mark Ramsey wrote a blog about this same article that took a somewhat different approach than what struck me after reading it. But that’s the beauty of blogs – we often have multiple views about what radio should be doing to reinvent itself.
To me, the article was about talent and adaptability – how some radio stars (Jack Benny and Bob Hope) took television and ran with it, becoming even bigger on the tube. And how others – notably Fred Allen – made himself obsolete in the “new media” environment of the ‘50s by ignoring changing times and technologies.
The article is an important lesson for today’s radio personalities, and a major component of my “Morning Show Boot Camp” presentation last month that encouraged embracing new technology. Bob Rivers’ session was a similar effort that reinforced the need to utilize and master social networking tools.
Too often, personalities get set in their ways, caught up in the old “theater of the mind” convention, and fail to integrate new ways for consumers and fans to enjoy their content and shows.
Technology breaks down the old “time space continuum” that we were first introduced to on Star Trek. You may be physically in the studio from 5:30-9, but in the new digital landscape, your content can be enjoyed 24/7 – whenever and wherever your audience wants it. If you allow them the access and control.
That’s the beauty of the web, smartphone applications, and podcasts – the ability for consumers to go beyond your transmitter and tower, as well as your “time slot” to access – and even interact with you and your shows.
New media also has the ability to pull back the curtain and let listeners behind the scenes – something they have always wanted to do. You may have first had this sensation when you watched the Imus show for the first time on MSNBC several years ago. It was fascinating to actually witness the sausage being made in the studio right before your eyes. It wasn’t always pretty, but it sure was compelling.
Yet, many personalities are afraid of the webcam, and the buzz that it can bring the station and their show. Similarly, digital means transparency, and that’s not always comfortable for heritage personalities. After all these years of radio broadcasters providing thousands of listeners with the content that we wanted them to see, social media flips the funnel.
This notion that consumers have something to say and content to provide is important. And in this process, they also can acquire information whether we choose to provide it or not. In this way, they are exerting control over their content, and the more secretive we become, the more the audience creates its own narrative – accurate or not.
A case in point is what happens when radio stations try to quietly let a personality go, hoping that listeners won’t notice. Today, that exiled DJ probably launches her own website to communicate with listeners, not to mention their Facebook page. And the audience networks with one another, piecing together the “what really happened” story on their own, for better or for worse.
Last year, I moderated some listener advisory board groups for a station that had recently fired a couple of long-time DJs. As is typical for radio, there was no communication with the audience – management just made their moves, and waited to hear from listeners via email or phone calls.
In the focus group, respondents starting talking about these personnel changes, and while some were genuinely out of the loop about what happened, others explained how they used search and social networks to find out what transpired, and in the process, formed their own opinions about whether the station acted wisely or heinously.
Again, it’s a matter of adjusting to the new medium, and realizing the new potentials and the new risks of going through the motions of the past, while ignoring the future.
At the “Morning Show Boot Camp,” there was one of those “exciting potential moments” when Gene Gates of the famous “Gene & Julie Show” at KVIL/Dallas took the mic to tell a story about how social networking can work in new and different ways for personality shows.
Many stations and shows simply view setting up a Facebook profile as a way to tell “friends” about upcoming features, guests, and giveaways. But Gene and Julie discovered that digital networking cuts both ways.
As Gene tells it, “We used to spend hours brainstorming to create a newsworthy event, and then many more hours witting clever press releases and faxing them to every TV station and newspaper. Then we would call all of the producers to confirm that they received the fax. The next morning we would get up early and call all of the producers at all of the TV stations to see if they were sending a crew.
"We were pretty successful, we have been a guest on the Oprah Show, we've been written about in the NY Times, featured on Nightline and dozens and dozens of local newscasts, but to this day I have no idea if any of that hard work ever increased cume, or improved TSL.
“Recently, we were invited to speak to a local group called eWomennetwork. When they told us there would be 2,000-3,000 people there, it didn't take much thought to realize this could be good for the show. What we were unprepared for was their intention to email their entire data base to tell them we were coming."
“The founder told us that they have 500,000 members, and they were going to blast all of them to tell them about us. When we consider the amount of work it took us to speak to their group for 90 minutes and the amount of work it took to get on local TV, there was no comparison. We spent 1/10th the time and got 1000X the reward. This one experience completely changed how we view social networks, and local press.”
Especially in an environment where if you ask for marketing money, management starts wondering if you “get it.” That’s a part of what Terry Teachout wrote about in his article – understanding the new environment, and ascertaining ways to make it work for you, not against you.
While radio may have lost some of its mojo, and a lot of its marketing budgets, there’s more to building brands than a few thousand dollars of cable trade or throwing up a few billboards. Consumers are rapidly organizing. Their group activities have become digitized. Smart broadcasters can tap into that, become a part of it, and expand their cume and celebrity auras.
As Fred Allen became more aware of his diminishing fame, he whined that because of the growth of television, “Radio was abandoned like the bones at a barbeque.”
But not all radio personalities suffered that fate. The ones who changed, adapted, and figured out that new outlets, gadgets, and media can provide opportunity became even bigger.
That process is unfolding once again right now, before our very eyes.
Notes From Boot Camp
It was an eye-opener. First, the sessions were on par with anything that you'd see at the NAB or other radio conventions. The "ops guys" session featured a dream team lineup comprised of Don Benson (Lincoln Financial), Phil Boyce (formerly WABC), Steve Goldstein (Saga), Pat Paxton (Entercom), Greg Strassell (CBS), and John Zellner (Clear Channel) - all candidly discussing what it takes for personalities to win in '09 and beyond.
Bob Rivers ran an impressive session that ended in a giant group discussion about radio, and the role of the personality. He is one of the great ones - a superb entertainer who brings the cerebral to the table. Bob isn't just well-spoken and meticulous about everything he does. He is also a true student of the game, and listed off some of the key books and authors that have guided his thinking. Bob has a great, dedicated team that produce a great product every day, and he generously shared his wisdom with the packed room.
And equally impressive were the questions from the audience, who profiled as enthusiastic, hungry jocks, personalities, and hosts. And that sums up the difference between what you see at Boot Camp compared to other industry gatherings.
These are the content people who got into radio on Day One because they love the business, because they truly enjoy being entertainers, and because they are passionate about their craft. While the industry spiral has taken its toll on many Boot Camp attendees, you wouldn't know it looking at their enthusiasm and energy. Despite it all, I got the genuine impression they haven't forgotten what radio has meant to them - and their listeners.
Contrast that with so many so-called industry professionals who have simply been in it because "it's a great business." When the bottom fell out, so did their dedication and their interest.
I have shared this quote before, but many years ago, Lowry Mays was interviewed in Fortune and uttered these chilling words:
"If anyone said we were in the radio business, it wouldn't be someone from our company. We're not in the business of providing news and information. We're not in the business of providing well-researched music. We're simply in the business of selling our customers' products."
They are in the radio business. They are in the entertainment business. And they will keep plying their craft, whether the margins are 40%, 20%, or 5%. They are realistic about the need to work with sales, enable NTR, and help their stations generate revenue.
And they are also solely dedicated to entertaining, and providing the content necessary to keep the business going, even given the challenges presented by PPM and those who interpret it. That's an incredible statement during a year when it would have been just as easy to stay home, and lick the wounds.
Boot Camp included some outbursts, some shout-outs, a little heated discussion at times, but always lots of energy and passion among the many who show up on their own dime. It reminded me of those old R&R Conventions (minus the record guys) where there was a buzz in the sessions, and around the hotel at night.
As we wrap up 2009, we thought it would be insightful to go back to past blog entries from the year that seemed to resonate with JacoBLOG readers. This one, from last February, elicited many comments from broadcasters - mostly in direct emails to me. Enjoy.
These are clearly times that try everyone's patience, commitment, and love for the industry that originally sucked us in with the chance to be successful in a career that promised music, stardom, money, fame - or combinations of all those things. Whatever your motivation for originally getting in, these economic times test everyone's resolve.
And it's not just the crap economy. As those of us in radio well know, things weren't exactly going well before last fall, when all hell broke loose for the country as a whole. Radio's fate had been sucking for quite some time, layoffs were already taking place, local and national radio dollars were shrinking, radio stock prices were cratering, and budget cuts were already underway. But now the combination of a media industry that is being challenged to its core and the overriding hurricane of an economy have created an environment that none of us could have imagined.
Many are living with their own Plan B's at work. Stations don't sound even close to as good as they should - or once did. Programmers and managers lack the tools they once enjoyed, staffs are eroding, and everyone's doing multiple jobs and enjoying them less.
So where does that leave us? We all have questions to answer that we can no longer evade. For those who are out of work, and see little opportunity for getting a job that utilizes their talents, Plan B may mean moving to another business, industry, or work lifestyle. Maybe it's starting your own company outside radio, training for a new profession, or working out a different employment situation with a spouse. As industry comrades, we once joked about how the U-Haul people often were the big winners in radio. But for veterans who have moved their families two, three, four or more times in the past few years or decades, making one more geographic journey may be the breaking point.
And for those who have escaped the Grim Pink Slip Reaper up to this point, sleep and solace may be lacking, too. This may not be what you signed up for, but it's the reality of right now. If you're in it for the long haul, then the question arises as to how can you make the best of a tough situation. In every crisis, heroes and innovators emerge. Instead of complaining about things not being as good as they once were, how can lifers take the cards they've been dealt, and play them with grace, class, and innovation? Those are the kind of Plan B's that you'll need in order to ensure there is indeed a viable radio business left standing when the economic winds start blowing positive again.
If you're a grizzled industry veteran, the Plan B question may be painful and uncomfortable. Maybe you never dreamed of getting rich in radio, but you probably never questioned whether the industry you loved would ever deny you a living. And if you've just been in radio for a short time, your Plan B question isn't an easy one either. There are lots of industries out there, and yet, somehow you decided on radio. How bad do you want it, and are you committed? Sadly, radio and the economy have made it more difficult for you to hang in there alongside us older guys for what is proving to be a tough ride.
Maybe one of the lessons in all this turmoil is that the so-called experts and know-it-alls simply weren't up to the task. Like in the financial sector, it has become crystal clear that the pundits, CNBC gurus, brokers, and financial wizards were as lost at sea as everyone else. They just didn't know it. That's the case in radio, too. The CEOs got it wrong, the analysts were off-base, and anybody who tells you they know the way out of this mess right now is the kind of false prophet that's the last thing you need.
You are as good a barometer of what's right, what's wrong, and what may work as anyone at this point. Maybe it's a matter of taking stock of your situation, and deciding whether you're in or you're out. And if it's the former, let's work together as a community of concerned professionals to figure it out, and get ourselves out of this mess.
What's radio's Plan B?
As the year winds down, and radio takes a breather from its many challenges, and hopefully, most of you do the same, I just wanted to take a moment to thank clients, friends, and readers of this blog. It has indeed been a tough year for just about everyone in this business, whether you've found yourself shockingly on the outside looking in, or whether you're toiling away in less-than-wonderful conditions in the thick of things.
This year has brought many of radio's long-standing problems and vulnerabilities to a head, and has tested us all. For us at Jacobs Media, it's been a learning opportunity, as it's called in Washington, D.C. Our apps business has thrived this year, thanks to the vision and hard work of Tim Davis, Paul Jacobs, our newest hire Scott Holiday, and our entire staff, who have stepped up in a big way.
We are still dedicated to radio and the growth of this venerable industry, but this "NTR" has become an important part of our company's arsenal. It has provided us with an even broader view of the tech world, and it has helped us better envision how radio can continue to morph and adapt to the many challenges ahead.
So thanks again for your support, your input, your encouragement, and your criticism. We will continue to call 'em as we see 'em, and hopefully strike that balance between being constructive but critical; a little fiery without being pedantic; and empathetic but with an occasional burst of frustration about why it can't be better.
We appreciate you taking the ride with us. This blog will be back on Monday the 28th with a few end-of-year entries, and perhaps a "best of" or two as we put the wraps on 2009. And then we'll see you, ready to fight the good fight on Monday, January 4th.
Happy, safe, and peaceful holidays to you all.
Then a funny thing happened, as I began to sing along to the lyrics….
That’s where the computer geeks stopped the song, instead of letting it naturally progress into Browne’s cover of “Stay” - the way I've heard since the album came out 30 years ago.
And that’s when I was reminded that all the "music genome" propeller heads in the world can stream all they want, but they’ll never really “get it.” They’ll never communicate the passion I have for my music. They’ll never wear the shoes of those great jocks that live and breathe the music of a generation.
How can they? Their exposure to “The Load Out / Stay” probably began and ended when they used their parents’ “Running On Empty” LP for a Frisbee. They have no context to rely on and don't realize what a heartbreaking mistake they are making when they click and drag a nameless, faceless computer file across the screen and into a different file.
You can give a digital tin man a heart any day you want, but it will only render a digital “tick tock.” It will never beat in time with the heart and soul of the music and the people who live and breathe it.
As a company and in this blog space, we have taken an aggressive approach toward digital technology over this past decade. I don't regret it for a minute.
Now we're seeing important shifts. Advertising dollars are skewing toward digital and away from traditional media, and yet, I still hear the same questions:
Are you sure we should be streaming?
Do we really need video on our websites, and webcams in our control rooms?
(OK, no one is asking that last question.)
But to provide some answers, let's turn to none other than Jon Stewart, the man behind the desk on The Daily Show. It is remarkable that Stewart's program has become a bona fide news source for millions of Americans, and it speaks volumes about just how far the networks and their affiliates have fallen.
"We make the doughnuts; we don't drive the truck."
Spoken like the great content creator that he is.
But for the rest of us, we have to focus our energies on making great donuts - the product, the air sound, the content. All the technology in the world isn't going to make up for a station that is simply not worth anyone's time.
But the distribution part - the truck - how people receive our content - is at the heart of the issue that many radio companies face.
Delivery is the challenge and it's the opportunity, and all these incredible ground-breaking content platforms - webcams, podcasts, Twitter, Facebook, streaming, smartphone apps - are all ways that consumers are coming to expect to receive their "donuts."
In fact, if you have a great station or a must-listen-to show, your fans will give you lots of love when you provide them with a cool new distribution outlet. We see this in those reviews in iTunes when we design and launch an app for a popular station or personality.
New ways to enjoy your content is at the heart of the issue. While Jon Stewart may not have to worry about how viewers will enjoy his show in the coming years, the folks who run Comedy Central sure do.
You can look at these new distribution outlets as one big pain in the ass, as so many broadcasters have over the years. "If we can't pay for it, we're not going to do it," has been the mantra that has kept so many stations from fulfilling their digital potential.
Or you can look at them as creating more opportunity. Instead of thinking about all of these platforms as digital albatrosses, companies that truly have great content ought to view them as providing exponentially more avails - more ways for smart clients to participate, additional avenues to promote, market, and spread the goodness of their brands, and exciting new streams of revenue.
Maybe the reason many broadcasters can't sell digital is that they're using the same tools and the same people who have sold time by the pound for all these years.
With digital, the glass is half full, the trucks are idling in the loading dock, and your fans now expect you to understand their consumption patterns and desires.
Transmitters and towers were all you needed in 1985. In 2010 and beyond, we're all going to have to do better if we hope our content arrives at the desired destinations.
There is a bizarre contradiction in the mobile space. In Japan, South Korea, and in many European countries, mobile phones do so much more than our iPhones and BlackBerries are able to accomplish here in the U.S.
You'd think that the country that spawned Microsoft, Amazon, Google, and Apple would be well ahead of the curve in mobile usage and technology, but that's simply not the case.
In Japan, for example, the eWallet concept is part of the norm. Consumers use their phones to buy tickets, access public transportation, as keycards that access homes and offices, and to even buy a Coke in a vending machine.
There are more than 4 billion mobile phones on this planet - more than there are computers, radios, and televisions. The future is that device in your pocket or your purse, and that's why it's never been more important for radio to be a part of this technology.
And it's about brands. Apple's ads that showcase apps "that need no introduction" (Nike, Starbucks, etc.) say it all about the need for individual radio brands to have a place on the iPhone (or BlackBerry or Droid).
Obviously, the iheartradio aggregated apps have value because they pack hundreds of stations under the same umbrella. But mobile is about individual brands, not malls. And the way that Apple and others market their phones should send a message to all brand managers and programmers.
Any product - a radio station, a music festival, a celebrity, a sports franchise - should have its own individualized app. You can only imagine how Garagantuan the App Store download statistics will look after this holiday buying season.
And mobile devices are only going to become even more prominent moving forward. That eWallet concept is coming. And soon.
For more than a year now, we have been gently reminding (and lately, hammering) our clients to get serious about creating couponing programs with local businesses and retailers.
Once those department store Santas put away their pillows and fake beards, drumming up business in January and February will be tough hills to climb.
Here's where radio can be effective. Because as Amazon.com visitation slows down, and those gift cards run dry, store traffic once again becomes a major issue for retailers.
And there's no medium better than local radio to drive consumers to "windshield businesses" - stores and companies that folks see while driving around their cities and towns.
Our Tech Polls and ongoing focus/L.A.B. groups confirm the need for consumer relief. And many radio listeners would love to see stations get serious about connecting audiences to retailers in order to pump up the local economy.
Oftentimes, these initiatives run counter to the mighty wind of Internet and search advertising that has diluted traditional ad dollars, and has contributed to crippling radio billing. As radio advertising markets constrict, it puts even more pressure on local stations to get on the buy, lowering rates, offering more clutter-producing promotions, and ultimately less profits and more brand damage.
But there is something that local radio can do better than any other medium - be it a website, a newspaper, or a TV station - and that's to develop a strong, vital, and viable couponing program. The data continue to show that more and more consumers are clipping coupons, looking for discounts and deals, and trying to find ways to save a few bucks on the goods, services, and entertainment that provide a decent quality of life. As those holiday credit card bills come rolling in, getting better deals will become even more important.
To beat back this economy, to cement lasting relationships with local businesses, and to truly show the power of the medium, it's not just about selling :30s and :60s or remotes. It is about demonstrating viable ROI in the most tangible way - consumers showing up with station-generated coupons to buy product and services.
And now, a recent study from Performics and ROI Research confirms that consumers who are part of social networks are especially open to marketing messages that deliver discounts, specials, deals, freebies, points or sweepstakes.
As the study's authors note, "The increasing hunger for more coupons and deals on social networks comes at a time when coupon use is increasing overall and has hit record-high levels. A study released last month by RetailMeNot.com found that coupons are now the deciding factor in purchases for nearly one-third of consumers."
Results from "half-off" programs already tell a great story. And if you take the time to survey your listeners, they'll tell you why these discounts work. Your station is a trusted source that can help direct the audience to great deals. And like no other personal, local medium, advertisers can benefit from your station's ability to motivate listeners to take advantage of client discounts.
Now you may be thinking that this study is really about Facebook and other traditional social networking sites. But I would submit to you that the KISW "Rockaholics," the WRIF "CyberCrew," and the X96 "Freeloaders" are all social networks. Your audience has opted in, they read your emails, and they are part of your tribe. They share a similar lifestyle, taste in music, love for your personality shows, and they've taken the initiative to become a part of your station's database program.
Providing your most active, P1 listeners with solid discounts, coupons, and other ways to save money works for them - and it works for your local advertisers.
But it requires a bona fide initiative from sales management with programming's help and blessing. For some time now, I have openly asked about precisely what a DOS does inside stations and clusters. That position simply has to be more than forecasting and setting up one-day sales. This economy and the state of radio in general demands more creative and strategic thinking.
And Catalyst's Cory Treffiletti notes that couponing does not appear to hurt a business' normal sales efforts: "According to a study from Coupons.com that was published in Q3 2009, online coupons are indeed driving incremental sales, with as much as 40% of redemptions coming from new or lapsed buyers. According to the same study, 63% of the redemptions drove incremental volume rather than cannibalizing existing sales. This would suggest that online couponing is a valuable and required tool for driving incremental sales!"
If you have a database, you have a research foundation from which you can survey listeners, find out what they want and need, and then work with advertisers to give it to them. As we are all fond of saying, this is not rocket science. It is, however, a call to re-examine selling philosophies, get your head around what's happening with your listeners and advertisers, and then create tactical solutions that address the changing landscape of consumer spending.
When the going gets tough, the tough assess their strengths and opportunities, and plan accordingly. Sometimes it requires different thinking, experimentation, and innovation. But running around with rankers and PPM data isn't going to move the needle in this environment. Especially in a challenging first quarter.
It's time for radio to demonstrate its true ROI.
As we've discussed many times in this space, many former radio professionals have ventured into new areas as our industry has shrunk over the past couple of years. At times these career jump-shifts have been forced by necessity. But in other cases, ex-radio execs have managed incredible transitions as they move into different media realms.
A case in point is Steve Godofsky.
He and I go back to '86 when he started up Charlotte's Fox - WRFX - for Metroplex Communications. Some of you may remember that company's owners, Norman Wain and Bob Weiss - two entrepreneurs from Cleveland who ran some great properties.
You probably know them as John Boy & Billy. It was the start of something very special, and it was great to be a part of Steve's team. Twentysomething years later, The Fox is still rocking Charlotte, and The Big Show is now a network with scores of affiliates all over the country.
Later in the 2000's, Steve and I crossed paths again as he became a Regional VP, and then a Senior VP for Entercom.
But little did many of us know, Steve had that author gene. And he's recently finished his fourth novel, The Liberation of Henry Belmont, the story of a guy who gets diagnosed with ALS, giving him three years to fulfill his fantasies. And as an added bonus, Steve is donating first year royalties to Make A Wish.
Here's the easiest way to get the book:
Congratulations to Steve for carving out his new career path. And I'm interested in hearing stories from others who have left the studio or radio conference room to forge a new way of life in a different business. Please send them along.
First, they drew a record crowd - in December and in a travel budget challenged environment. Second, there were a lot of programmers in the room. And finally, it was good to get outside of Arbitron headquarters. The change of venue was a positive.
As PPM reaches that tipping point where more markets are coming online, there is an even greater need to understand how it works, how it should be sold and marketed, and best practices. Kudos to Gary Marince, Rod Rodrigues, and the Arbitron team for putting together a uniformly strong series of panels and sessions.
For me, this "Fly-In" had a special treat. As many readers of this blog and friends of mine know only too well, I am a Starbucks Super P1. One of the best sessions was "The Brand," presented by Starbucks' Director of U.S. Store Level Marketing, Bill Black.
Bill came out in a green barista apron, and proceeded to show the room how strategic research and market segmentation makes his company smarter, and provides their team with the knowledge that can grow their business and sustain their dominance.
There were lots of charts and graphs, but it was less about coffee consumption, and more about the mind of the Starbucks customer. I learned there's a name for people like me - "Super Regular." And along with another key segment, "Coffee House Enthusiasts," Starbucks focuses on these two segments above all others. That's because the "Super Regulars," may only be 4% of their overall consumer base, but they contribute 20% of Starbucks' revenue. The analogies to radio abound.
Beyond whether they drink fraps, espressos, or brewed coffee, Starbucks studies and tracks their aspirations and their attitudes. Of course they know age, sex, education, and ethnicity. But they also know each segment's "best moment of the day," the car they'd like to drive, and their view of the world.
So for us "Super Regulars," it's all about maintenance. But for those "Coffeehouse Enthusiasts," there is great growth potential. These customers skew younger, female, and their values closely mirror Starbucks' DNA. Black's team knows there is headroom with this group.
And in their meetings, the focus on these two segments is laser-sharp. "We have to focus on our core," notes Black. So when brainstorms drift into less productive areas, the litmus test is whether an idea addresses "Super Regulars" or "Coffeehouse Enthusiasts." If not, they simply move on.
That's not to say that Starbucks isn't looking toward the future. Overall, 7% of their business comes from young "Basic Occasionals." These are the teens and tweens who never knew a time when there wasn't a Starbucks. They may not have the spending power now to become core customers, but they will down the road. Starbucks clearly has an eye on its future, rather than simply chasing today's dollars.
You couldn't help but conclude that Starbucks knows a great deal more about its clients than we know about our listeners. I sat next to research maven Charlie Sislen, who was also impressed with the depth and breadth of Starbucks' segmentation knowledge. He reminded me that radio has Scarborough, but the fact is that tool is mostly used to show off big indices in sales pieces. The lack of research that would allow radio strategists to envision key audience target groups is part of the reason why there's often a failure to see the bigger picture in our business.
Knowing the songs they like or which station plays too many bad songs along with the good ones is all about us. Starbucks asks those same types of questions, but focuses their research on the customer. That information is the backbone of how their strategy is set, and the ammunition they need to understand what's happening with McDonald's, Dunkin Donuts, and the myriad of other competitors gnawing away at their core.
A case in point came from a story that Black told about a customer who told them about the importance of ensuring his morning beverage is prepared to perfection: "If you don't get the drink right, it sets the tone for the entire day." The attitude of the barista, as well as the ability to get that "Super Regular" in and out, is all part of creating that perfect morning experience.
And of course that brought to mind how a morning show can also make someone's day - or get it off to bad start. A poorly prepared feature, a lame bit, or a whole lot of rambling - well, you get the point.
The commercial radio industry has a great need for an all-encompassing study that lays out its core segments, identifies the problems, the challenges, the potentials, and the opportunities for growth. Continuing to simply test the gold library or ask the same series of image questions will help win the market skirmishes, but do nothing to help programmers and strategists see the bigger picture.
The entertainment and information media marketplace has only become more competitive during this last decade, and yet radio's research techniques are still very 1978.
Our Paul Jacobs was invited to present at this year's "Strategic Digital Leadership Summit for Public Radio Stations," held on the USC campus. Here are some of his takeaways from this year's conference:
We all know how challenging a year this has been. We've been inundated with news about layoffs, cutbacks, and rumors about media bankruptcies. We've been involved in too many meetings that focus on shrinking the business in order to save it, and too few meetings that focus on the future in a positive, constructive, visionary way.
Last week, I was invited to speak at the "Strategic Digital Leadership Summit For Public Radio Stations" at the Knight Digital Media Center's Annenberg School For Communication & Journalism at USC. Usually, simply going to southern California in December is enough to make me happy, but this conference stood out.
In case you weren't aware, public radio has been at the vanguard of developing and championing digital platforms. Between their investment in HD Radio, their mobile strategy, and their podcasting initiatives, public radio is engaging Americans everywhere. And this conference is one of the reasons why. At a time when too many companies have cut back on travel to conventions, this was a three-day gathering among 100 leaders in the public radio system dedicated to learning, exploring, stretching, and attempting to better understand the digital road ahead.
They brought in big thinkers, including Lee Rainie, the director of the Pew Internet and American Life Project, who shared data to help predict the next phase of digital engagement. Paul Saffo, a forecaster, futurist and essayist from Stanford showed the future thinking going on in Silicon Valley and the next big game changer (hint: it's going to come from Apple and it's their new digital tablet). There were outstanding panels where everyone was encouraged to ask questions, probe, and discuss various challenges, roadblocks, and opportunities for the total public radio system.
Even the dinners were substantive, with NPR's CEO Vivian Schiller speaking one night, and the Director of the Annenberg School and former editor of the Des Moines Register leading a discussion the other night. There wasn't a moment when we weren't thinking about the future and how to get there.
I was proud to be included in these sessions and to share our company's vision about where public radio (and all radio for that matter) can go. As attendance at industry conventions continues to shrink and/or be limited to only the highest executives and their bankers, the medium needs to re-consider the value of gathering smart people together at all levels of our industry and letting them share ideas. No one radio company has the power to "fix" all of radio's problems, but collectively, we might be able to tap into our brainpower and actually improve things.
Here's the dilemma - more and more consumers are streaming video, and the more they do it, the more they like it. We continue to track this trend in our annual Technology Polls, both among commercial radio rockers and Public Radio listeners.
But as we know too well, most radio people have not been schooled in video production and editing (that "Theater of the Mind" mentality), and at this economically challenged time, companies are hard-pressed to initiate video programs.
We have discussed this issue in this blog before, and some operations have been able to identify staffers who are skilled in this area. Others have sought out young, talented media types who learned their craft on Macs in their rec rooms.
But for the most part, radio station websites lack video content. And this only serves to send listeners to other destinations in order to enjoy music, information, or comedy. Given that there are ROI challenges revolving around producing video, what options do stations have?
But now there's another way, and it could be of interest to local radio companies and stations. YouTube has created a new video creation service, and already, impressive brands like the San Francisco Chronicle, Politico.com, The Huffington Post, NPR, have joined in. "YouTube Direct" is an online tool that lets these organizations make use of videos that have been submitted from freelance contributors. They can edit, tweak, and tailor these videos to be sure they fit their respective standards.
This concept marries the "Citizen Marketers" that Ben McConnell presented to our Summit a few years back with the widespread popularity of streaming video on station websites. In this way, news organizations and even music stations can tap into their creative audience bases to aggregate, screen, edit, and post much-needed video content.
Too often, clients tell me that all this technology is great, but how can radio stations under the financial gun possibly take advantage of new digital tools?
YouTube may have just offered a way, and for starters, give credit to savvy news organizations like NPR and The Washington Post for boldly trying something new and different.
I recently heard former Google exec Ram Shriram make this point: "The cost of failure is far lower than the cost of not trying."
Those of you who know our company are aware that we are based in metro Detroit. We sarcastically refer to the Motor City these days as "Ground Zero" because there's no place the recession has hit harder than right here. While only a small percentage of our revenue here at Jacobs Media is derived from Michigan radio stations, just living here is a testament to the difficulty that America has faced economically during the past few years.
On top of record high unemployment and the decline of the auto industry, one of the results of all this tumult has been the exodus of young people to places like Chicago, New York, and points west. It is a serious problem because even if Michigan is successful in attracting new industry to the region, much of the area's youth have made their decisions - in droves.
Beleaguered Governor Jennifer Granholm has been roundly criticized by many here in Michigan. However the pundits cast the blame, she certainly has been a victim of unfortunate timing given the demise of the auto industry and the larger economic crash. She recognizes that the state has to rethink some of its givens if it is to regain any degree of respectability.
That starts with trying to retain the young people who still live here, while attracting others from around the Midwest. She created the "Cool Cities" initiative, and here's her "take" on why this is important to Michigan:
"Government can’t create cool, but we can and will target existing resources to support these local efforts to create vibrant cities, centers of commerce – as recommended by the Michigan Land Use Leadership Council. For example, our Michigan State Housing Development Authority, MSHDA, will pilot in 12 cities an offer of incentives and financing to create unique downtown developments where loft housing, art galleries and technology start-ups can all share the same historic brick building. The Department of History, Arts and Libraries will target arts and cultural grants toward main street revitalization in those cities. Young people are rediscovering Grand Rapids, Wyandotte, Ferndale, and Detroit. These coordinated efforts will accelerate that trend – which is an economic imperative. For the workforce of tomorrow wants to live where it’s happening, and employers will not come here if that future workforce – the technology workforce – has left us for New York or Boston or Chicago."
But the issue of this blog post revolves around Michigan enticing Hollywood to come here to make movies, thanks to a generous incentive of up to 42% of film production costs. It's worked - films like Clint Eastwood's Grand Torino and Drew Barrymore's Whip It were both made here, along with 82 film projects since the incentives were passed back in April '08.
But now, members of the Michigan legislature are challenging the value of these incentives, and a debate is raging in this cash-strapped state. Actor Jeff Daniels who lives here in Chelsea and is a big supporter of the arts here in Michigan, is questioning why anyone would mess with this program's success. So far in '09, $216 million has been spent on films made here in Michigan, and now entrepreneurs and schools are planning studios and academic programs to train young Michiganders about the art of filmmaking.
But it goes beyond revenue from Hollywood, and even the start of a new industry center for Michigan. A vibrant local film industry will attract young people, encourage others to stay around, and create jobs, educational platforms, and lots of buzz.
So what does this have to do with radio? Well, you could make the case that our industry is going through some of the same stresses that are facing Michigan. Radio's legacy business model is being threatened by new media and gadgetry, and our ability to keep young people attracted to radio has been challenged. As Chicago or Boston sound more exciting to college kids, so does Pandora, Google, and Facebook.
But the difference in this story is that most of the leadership here in Michigan is aware of the problem, and is trying to do something about it. In radio, there's been lip service over the years about the "youth problem," but precious few initiatives to address the steady youth listening erosion, much less the lack of interest by young people choosing radio as a career.
Does radio's leadership perceive the Gen Y drain to be a problem, or is it just about economic efficiencies and higher margins? You cannot fix something unless you recognize it's broken, and perhaps that is at the root of this discussion.
As Michigan knows, this problem isn't going to go away. Nor will it solve itself. An economic recovery isn't going to simply reverse the flow of young people leaving the state. And in radio, the same is sadly true.
Radio is an industry of middle-agers, most of whom have worked in the business for decades. While that experience has value, it also speaks volumes about the difficulty of transitioning to the new media realities.
We need young people in this business - to bring new energy, ideas, and passion to radio, to better represent the digital age, and to provide the perspective that companies need in order to imagine and participate in the future.
There are universities, community colleges, and high schools in every town where there are radio licenses. The industry would do itself a service by creating its version of a "Cool Radio" initiative - a way to attract, mentor, and grow that all-important injection of youth.
Here's hoping that Michigan and broadcast radio are successful.
As the online music world continues to be defined and refined, Apple's purchase of Lala Media is noteworthy. While no one can dispute the success of iTunes as a music discovery and revenue generating portal, the process of finding new songs and artists online has morphed considerably over the past few years.
I discovered this one day over a year ago, and wrote about it on this blog. I found my son "watching" full-length songs on YouTube. He wasn't terribly interested in the video, but was using YouTube as a way to discover new songs, and listen to them in their entirety - not in 20-second snippets like iTunes offers.
And more recently, the fast-rising success of Pandora and similar services has to be telling the Apple geniuses that streaming (for a small fee per song) is a great way to enjoy music, even if you don't own it.
Of course, Apple is staying quiet on their ultimate plans for Lala, but already, there is reportedly a Lala iPhone app in development. This reaffirms the value of streaming model, and it also underscores the importance of the iPhone and other smartphones as a portable, take anywhere conduit.
In a perfect world, Apple will activate that alleged chip that will allow FM radio broadcasts in the iPhone. But in the event it never happens or occurs some time down the road, Steve Jobs has given radio the open door to the iPhone via branded apps.
Obviously, that's been our play at jacAPPS for more than a year now, and 100 apps later, there is no better way for terrestrial radio brands to buy "real estate" on the iPhone.
A lot of pundits make light of streaming apps, claiming that these smartphone applications can do so much more. Of course, that's true, and radio and personality brands would do well to put some time in creating strategies for the apps they develop.
But when consumers enjoy listening to your radio station - and millions of them still do every day in this country - an iPhone or BlackBerry app that elegantly streams is a pretty cool gift in and of itself. As Apple adopts a streaming model with Lala, terrestrial radio stations can stay ahead of this game by ensuring their content is available on the most popular smartphones.
For the past 14 years, we have put together, produced, and pulled off annual Jacobs Summits, first with Gavin, then for more than a decade with R&R, and since last year, with the NAB. We've learned a great deal about the art of booking, scheduling, and presentation, especially during the past few years when many broadcasters have discouraged their own employees to attend conventions. Go figure.
It gets tougher every year, especially as the economy has roared over radio, and now the entire globe. Travel budgets were first in line to get slashed, so if conventions are going to successfully attract broadcasters, they had better be content-rich.
So when sports consultant Bob Snyder and former Jacobs-employee Mike Stern came to us with the idea of a virtual convention, they had my attention. The idea is that you can sit down at the comfort of a computer, and enjoy some compelling sessions. There's also a virtual "exhibit hall" where advertisers can show their wares, ask questions in a chat format, and interact with convention-goers.
Our jacAPPS division will be represented because we believe there's a market for smartphone applications among sports franchises, sports radio stations, and of course, sports personalities and talk show hosts. As some of you know, we have developed apps for Dan Patrick, as well as other national personalities and shows, so Bob's show struck us a natural.
How will the virtual convention itself play out? Well, we'll have to see, but there is clearly something attractive to guest speakers about not having to jump on a plane and fly somewhere to present. It should be interesting, and Bob has assembled a strong list of guest speakers, including - sports personality, Tony Kornheiser, ESPN's Marc Horine, WEEI.com's GM Tim Murphy, NHL SVP Perry Cooper, Mark Turley of the PIttsburgh Penguins, Craig Zurek from the Dallas Cowboys, and iBiquity's Bob Struble. From talent issues to digital strategies, it's shaping up to be a full day of virtual convention content.
And of course, the price and convenience are the keys. It's $79 for the day - this Friday, December 11th from 11a-6p EST. And that price means you could jam in an entire staff into the conference room, sort of reminiscent of those drive-in movies that some of you remember attending a few decades ago. Of courese, you needed a roomy trunk.
Will virtual conventions replace the big gatherings we've come to know and often enjoy over the years? The power of the Internet to challenge our convention(al) wisdom can never be under-estimated. We were too curious about this model not to give it a shot.
So, we'll hopefully see some of you online as we test-drive another innovation that could only happen in an Internet world. We'll be in the Virtual Trade Show, talking apps, of course.
You have to give Radio Ink's Eric Rhoads a lot of credit. If you missed it before the holiday, he is now "all in" for HD radio, on the strength of an inexpensive radio that he helped design in concert with iBiquity.
The essence of Eric's initiative is that among HD radio's many sand traps, a glaring problem is that many radio professionals have never experienced it. Sure, a lot of people sampled it back during the early days when those original Boston Acoustic units made the rounds.
But a lot has happened since on both the technology and price fronts. Yet, many of the thousands of folks employed in radio haven't really spent time with an HD radio. How's that for a disconnect? You can't exactly market or promote something effectively when you haven't really sampled it yourself.
So the "Mighty Red" radio is a $35 appetizer, designed to entice radio professionals and their companies to sample HD radio at a very low price. Hey, if you buy one and end up hating it or thinking it's not that big a deal, at worst you're out the price of a nice dinner.
But if you like it, you'll tell others, it will be easier to market, and perhaps consumers will finally start getting the word from the radio stations they listen to every day that HD radio is a great entertainment deal in these cash-strapped times in which we live.
As Eric points out in his blog (below in its entirety), there have been many speed bumps during these past few years. HD radio is challenged on many fronts - consumer awareness, availability of radios in vehicles, the challenge at retail, HD2 programming quality and commitment, and technical issues.
Like him, I have also struggled to make my own determination about whether this thing has a chance or whether it should be written off as a well-intended failure. We have conducted our own research on HD radio, including a major project for iBiquity back in '08. In every case, there have been positives, but also troubling signs involving the aforementioned challenges.
No one said it was going to be easy. At roughly the same time, HD radio made its awkward debut, satellite radio and iPods were media darlings. It isn't difficult to look at the game films and come up with a number of questionable calls and blown plays.
Back in the '60s, there was a saying: "If you're not part of the solution, you're part of the problem." I have thought about that phrase a great deal over the past couple years, because it is so easy to slip over to the dark side, and start throwing grenades at everyone you think is responsible for radio's problems.
But Eric notes that radio companies have converted nearly 2,000 stations to digital broadcasting, not to mention the increases in commitments from car manufacturers. Radio has a fiduciary responsibility to its owners, its stockholders, and its partners to at least give HD radio an honest try.
Our company has recently been retained by the Alliance to help set the best creative tone for HD radio advertising in 2010. There's no Don Draper on my staff, but I am hopeful that armed with the tech surveys we've conducted during these past few years, combined with hundreds of Listener Advisory Boards and focus groups - coupled with the creativity of some of radio's best production talent - we should be able to make a contribution.
At least, I hope so. I hear those voices of respondents in my head, as well as the many critics who have been very vocal (and at times, I have been one of them).
But I think that Eric makes some great points, and it's time for this industry to either get behind and support HD radio, or pay the price with a high-visibility failure. I, for one, am tired of seeing radio get its ass kicked by critics, pundits, newspaper writers, and frustrated ex-employees.
We either figure out a better way to make this work or we look like jerks for not trying.
Your comments, brickbats, and suggestions are welcome.
In the all-important lexicon of how best to report one's news and views, Twitter has made a left turn perhaps into the right place to maximize its ability to rapidly spread the word to networks of users.
You may recall that from the beginning, Twitter's 140 character or less question was "What are you doing?" Of course, that was exactly what jock sniffers and star chasers around the globe wanted to know, as they followed everyone from Shaq to Britney.
But for the rest of us, this question tends toward responses like "Having my nails done," "Running errands," or my favorite, "Waiting for the big game."
While Twitter's rapid growth is impressive, one of the reasons why many tire of the service is that it is self-indulgent, to the point where it is hard to care about the mundane activities of people's lives (much less your own).
But Facebook, realizing the power of "now," changed its home page to "What's on your mind?" - a similar but different way to engage its rapidly expanding membership. As Facebook users know only too well, however, this change has spawned many of the same insignificance from its users, cluttering pages with useless, tiresome information about the boring intricacies of the lives of their "friends."
So in an about-face, Twitter has changed it prime greeting to "What's happening?" And in the process, they may have changed the game.
Maybe this new question will inspire Tweets to become more current, more meaningful, more informational, more entertaining - and hopefully, less personal and trivial. When Jerry Seinfeld related the humor of mundane activities, it was hilarious. For most other people, not so much.
As founder Biz Stone notes, "Twitter helps you share and discover what's happening now among all the things, people and events you care about."
Let's hope so, because if this service is going to provide users with real information and not just a lot of philosophical blathering and self-gratifying comments, the Twitter lens needs to show us something we don't know but ought to care about.
A recent MediaPost commentary by David Koretz, CEO of BlueTie, jumped out of my email box. Like many of you, I receive umpteen advisories and think pieces from a multitude of different sites. And I'm always hoping to find an article or train of thought that is original and on-point.
David's "Don't Drop The Egg" piece was just that commentary, succinctly discussing the different types of leaders and businesspeople that occupy offices through our industry - and the ones that are most effective in problem-solving and innovating in this challenging era.
Giving MediaPost due credit here, I'm posting David's article below, but if you're rushed today and can't get to it, this excerpt summarizes it nicely:
As a result, success breeds a fixation on maintaining the empire, and in the process creates complacency and a huge aversion to risk.
The more money you make, the more time you spend protecting your assets and the less time you spend growing them. Ultimately, you spend all your time just trying not to break the egg.
As a result, success breeds a fixation on maintaining the empire, and in the process creates complacency and a huge aversion to risk.
The more money you make, the more time you spend protecting your assets and the less time you spend growing them. Ultimately, you spend all your time just trying not to break the egg.
Thanks, David and MediaPost, and I hope this piece resonates for you like it did for me.
Now I know what you're thinking, but it's all about connecting with someone you should know. If you remember that old show, host Bob Eubanks would try to trip up newly married couples by asking them basic questions about relationships, food, likes, and dislikes. Of course, the goal of the show was to create embarrassing situations where the husband and wives would fail to know something very basic about the other, and the laughs would follow.
One of the more highly publicized moments on the show was the response from a young wife to the question, "Where was the most unusual place you've ever made whoopee?" (Answer at the end of the blog.)
This played out in the aforementioned study where newspaper executive perceptions were contrasted against reader perceptions. Sadly, there is a gap that speaks to the issue of media prioirities in an environment where consumers are increasingly in control of the content that is available to them.
There is a 10 percentage point gap between these two groups when it comes to the most ratings for online news content value. While more than half of the news executives (54%) believe it is "very valuable," only 44% of readers concur.
Similarly, only 9% of these newspaper managers say it would be "very easy" for their readership to find a replacement for their web news content. This compares to nearly one-fifth (19%) of readers who offer the same opinion.
But the biggest gap - or abyss - between news providers and their readership audience was to the question about where consumers would go if their online newspaper web site were not available. The news execs assume that three-fourths would revert to the print newspaper. But in fact, only three in ten readers say this would be their choice. Instead, two-thirds would simply surf over to another local web site for information and entertainment.
A tough, but important conclusion by the study's authors is that "among news executives, there is little understanding of basic reach and audience behaviors."
What would this type of study say about the powers that be in radio? The trades are so clogged up with CEO reports about margins, debt loads, and EBITDA that it's difficult to determine the connections between broadcasters and the rapidly moving audiences they are trying to serve. It is all too rare that we read about a CEO's vision of the future, identifying the opportunities that lie ahead and the investment being made to take advantage of the possiblities.
This is why our company continues to design and conduct those nationwide web-based technology surveys each year. Sadly, they are often more widely consumed and discussed by programmers than by the folks at the top of the flow charts. This is valuable data that clearly shows where the audience is and will be, but is it changing the agenda?
At least, the newspaper execs are trying. They have been researching these issues for several years now. While you might conclude they have failed to act on the conclusions of many of these studies, there is no lack of data to help guide decision-making. As newspapers have sadly demonstrated, old habits and old industries die hard.
Back at the NAB, we called for an all-industry S.W.O.T. analysis that starts with a nationwide study of consumers opinions. Just easing the debt isn't going to "fix radio." It may lead to an environment where stations can operate more smoothly with less omnipresent pressure from lenders and banks.
But it won't address the need for rethinking everything, better understanding the consumer, and moving toward solutions that create a better listening environment and solutions for advertisers and marketers. This isn't a game show, and there's nothing humorous about it. The concept of getting back in touch with consumers is not only hard work, it also requires investment, commitment, and placing a priority on ensuring that stations and radio companies are doing more than just managing expenses.
The new technology era has been challenging and often frustrating to radio people. Many struggle with ways to integrate different platforms, like mobile and streaming. Others grapple with how to utilize social networking tools, like Facebook or Twitter.
It is somewhat understandable that the radio industry hasn't found those "best practices" that would enable it to take advantage of new digital tools, rather than to be passed by or left behind by new media and technology.
But where it is inexplicable is radio's inability to grasp its eTail potential and its stations' brand equity. I blogged about this last month, wondering (for the fourth consecutive year) why most radio stations - including the biggest and best brands - often don't set up their own logo ware stores, and use the holiday season as an opportunity to utilize their often large databases to make several thousand dollars at this opportune time of the year.
And like many of you, my email box was loaded with great deals, from Apple to Barnes & Noble to the NBA to the Detroit Tigers to my local car dealer. (I have "decorated" this blog with just a few of the tantalizing offers I received.)
But despite belonging to umpteen radio station email clubs, I did not get a single email about a sale on station branded items and related merch. Instead, I received station emails about special programming weekends, and the typical email blast tactics.
Radio continues to let its best brands wallow. While many whine about the lack of outside marketing, most broadcasters aren't utilizing many of their existing assets and tools. Somehow sales and management haven't connected the dots about the power and potential of radio's expansive email databases. To most, those thousands of connections with loyal listeners are simply PD activities, and seemingly have no sales implications.
This is small potatoes in the big picture of radio's need to redefine itself. But it is indicative and telling about the disconnect between the industry and the rest of the world. We continue to sell and market radio like it's 1978.
The digital disconnect continues.
PS. After this blog was written & posted, I received an email from KSEG/Sacramento, urging me to take advantage of their special holiday discount in their "Half Off Sacramento" program. I'm sure there must have been a few others, but they were not in my email box.