Radio’s 5 Customers

“Radio is at the tipping point, and it doesn’t want to know much about the way its customers are changing.”

Joint Communications’ John Parikhal tells Tom Taylor of Radio-Info.com in yesterday’s daily newsletter he’s worried about radio tuning out its listeners:

“Internet companies are checking out the customer six ways to Sunday. But radio will tell you they don’t have the money to research their customer. I truly think we’re at the tipping point, because for any business, you have to know who your customers are. 

For radio, it’s 5 different customers:

#1 – Wall Street or another ‘lender’.

#2 – The advertiser. And radio should focus a lot more on the advertiser, because it has given them very short shrift. The more innovative companies are trying to become the digital and media marketing experts for the local guy, to help them move more product. Their competition is Craigslist and emerging online city directories.

#3 – The FCC, and I sense that radio will be hearing from them within a year.

#4 – The employees. With a few notable exceptions, they have been treated the way no customer should ever be treated. This whirlwind of firings and layoffs has nothing to do with performance, and the message it sends is very negative. People are now very, very wary about making radio a career.

#5 – The listener. But radio thinks ‘all we have to do is keep the listeners we’ve got.’ That’s a fool’s game. You have to grow the pie, and to do that, you need to know more about your listener than their favorite songs or that they like sports on the radio. The listener doesn’t care that radio is in a recession and won’t invest in understanding their changing needs.”

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3 Responses

  1. Radio ignores its five customers at its own peril. Not a good idea, particularly at a time when we need to stage a “comeback.”

    George
    http://georgereedradiotv.blogspot.com/

  2. I think a #6 is missing in the picture, and this is one that can have a major impact in the shift to digital : Soundexchange and the Copyright Royalty Board.

    The major labels are fighting to get more money in royalties from radio stations, and the royalties that are set for Internet streaming, podcasting and other ways of webcasting will complicate the life of radio stations that will go to the web for new revenues and new listeners.

    Guillaume

  3. Arbitron/Edison did a study “The Infinite Dial 2009” indicating that radio listeners are listening to their terrestrial stations online and that online radio users do not report spending any less time with radio.

    AM/FM radio still have a strong impact on their audience. (http://www.edisonresearch.com/Infinite%20Dial%202009%20Presentation.pdf).

    It’s important to know how your audience media habits are changing. That’s why most of the campaigns we design today include mobile marketing components with direct response radio to provide coupons, discounts, location information, audio and video clips and to drive traffic to web sites.

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