The radio business got into trouble because it was ‘consolidated’ -when Congress said there should be no limit to station ownership – radio owners believed that somehow ‘big’ would translate into ‘better’.
Well, big didn’t mean better.
Instead, ‘big’ translated into ‘dumb’ as most (but not all) of the consolidators proceeded to pile on commercials, fire program directors and managers, bully the record companies and cut marketing and research so they knew less about their listeners than ever before.
Not surprisingly, their audience got smaller, advertisers got turned off and their share of revenue declined.
And, radio blamed everyone except themselves.
It’s the internet’s fault. Not really. Radio came very late to the party. Many aren’t there yet. I saw a radio website recently that still had a Christmas promotion on its home page! And, this was a major company.
It’s the advertiser’s fault. Not really. They are shying away from radio because the internet appears to be a more efficient way to measure and reach customers. Does anyone remember Lowry Mays’ famous comment that he wanted to pay Arbitron 20% less – when the service was already substandard in sample, especially among 18-34?
It’s the listener’s fault. Tragic. Blaming them because radio became even more predictable and less innovative.
It’s Wall Street’s fault for demanding huge returns. Ridiculous. Wall Street is a pimp and everyone knew it going in.
So, what’s radio to do?
First, stop acting like a victim. Second, come up with better ideas. Third, suck it up and accept that you have to invest to make products better – the shell game of cost-cutting doesn’t impress anyone anymore.
Let’s start with low-hanging fruit – cheap and easy ways for radio to make more money.
- Dump bad initiatives and start good ones. HD is DOA. Spend your time and energy tapping everyone except the most senior executives – who seem to spend too much time with each other and not enough in the trenches. Stop surrounding yourselves with ‘suck ups’ who agree with bad ideas because they are afraid for their jobs or need your business.
- Push hard for a 30-59 demo buy. For decades, radio has been driven by advertiser’s demands for 25-54. It’s so out of date. Get modern. Already, 16 million Baby Boomers are 55-59. They spend billions –and radio ignores them. In the next 4 years, another 16 million will be 55-59. Meanwhile, 25-29 year olds are less interested in radio than ever before. Get real. And, if I hear ‘we can’t tell advertisers what to do’, I repeat – stop acting like a victim.
- Encode song ID. This is a simple, not-too-expensive fix. Make sure that when you play a song, the title shows up on in-car radios. iPod does it. Satellite does it. But some stations won’t spend the money! Even though 50% of radio listeners want to know the name of the songs each time they are played. Then, get serious about some longer term changes…
- Tap your employees. Get serious about innovation. It’s usually ‘bottom up’. Radio has proven you can’t do it top down. The best ideas come from those closest to the customer. Put a process in place to listen to your employees who actually interact with your listeners and advertisers.
- Advertise. Stop acting like poverty stricken corner stores – who cut their ad budgets when sales are down. Act like serious players – HBO, even Eggland’s Best Eggs – let people know what you’re doing, what’s new and why you matter. And stop acting like a victim and saying you can’t spend the money. You have to! Build it into the budget and don’t cut it if times get a bit tough.
- Learn about your customers. Do you know that fewer than 4% of your listeners ever text a radio station? Do you know that almost 25% of those who go to a radio station website are also listening to at least one other internet-only station too? You learn this by researching your customers. Full disclosure – I do a lot of market research for clients ranging from radio to bankers – so this might look like self interest. Except that the reason for the market research is because I learned 40 years ago that if you take your eye off the customer, they take their eye (and ear) off you.
- Get serious about your website. Update often – at least every day. I saw a radio website recently that still had a Christmas promotion on its home page! Optimize search. Make it easy to find the ‘listen’ button. Include a phone number in your ‘contact us’ information. Update constantly. Post lots of photos. Give your staff cameras and show them how to take a good photo. Do usability testing.
- Adapt to the new world. Drop the clichéd slogans and connect with the real world. Accept that 30+ listeners are the future for at least another 5-10 years and figure out how to make them REALLY HAPPY with you.