The inclination of many will be to write off 2020 as a horrible year for the world and for our business. The question is, will radio “get back to normal” in 2021 or 2022 or should it be focused on a new business model?
Significant challenges often force industries to reevaluate, and some good can come out of this one. It may not be what everyone in the industry wants to hear, but companies are being forced to focus on return on investment (ROI). By that I am not even talking about financial ROI, though that is a part of it, but consumer ROI. What things really generate audience and audience loyalty? Which stations and shows will get a consumer ROI? As an industry, making consumer ROI a priority will require care, balancing broad appeal with a likely slow but narrowing focus to generate more core passion. Plus, as I will address below, I think it is time to start investigating totally new opportunities for radio stations and companies.
But first, let me talk about the here and now. Radio’s workforce–including owners, General Managers, and Program Directors–have been tasked to do more with less. This requires a laser focus on things that really matter. This does not mean that every cost cutting move is a good one or that radio can be fully healthy by cutting left and right. Owners need to know what the wheat is and what the chaff is.
So, what is the wheat and what is the chaff? What matters? First, format dominant and revenue critical stations matter. They are the wheat that will get radio to the future. Also, strong personalities, strong music, and strong leaders on those stations matter.
But, all this is a status quo or defensive strategy. It is likely to extend the life of the best stations well into the future, but it is not the dramatic cure that will attract new non-users to the medium in large numbers and as passionate fans. Radio needs offensive strategies. Just as you can’t win a football game without an offense, radio cannot reinvigorate the medium with defense alone. It needs to play great defense right now, but it also needs an offensive strategy going forward.
I think the offensive strategy begins with the weak stations that may fill a format hole, but do little for the future. Radio needs to look to new ways to truly energize the medium. This comes from changing the paradigm about how we program our weakest stations. Right now our paradigm for these weak stations is music, news/talk, 12 commercials an hour, music sweeps, stop sets, morning shows, etc. It’s the world we live in and the world advertisers live in. And it’s been essentially unchanged for decades.
Coleman Insights believes in the importance of these elements for the majority of the most successful stations. Music is still an overwhelmingly important listener benefit, but we also recognize that competition for the music listener is getting harder every day and will get harder in the future.
However, looking down the road, there may not be enough music lanes to support three to five stations in a cluster. And the weakest music or talk stations trick us into thinking we don’t need to think about more important changes that might actually grow the audience and revenue opportunities on these signals. There are already weak sisters in every company and every cluster and there will be more down the road. Employing the strategies of the successful sisters may not be enough for the weaker sister stations.
This is where the current paradigm meets the new competitive world. In order to grow as a medium and stop playing just defense, we must examine other paradigms. We need to find values for consumers that go beyond just our music and personalities. Radio must find new ways by experimenting. I don’t mean throwing ideas willy-nilly against the wall, but strategically considering all ideas, evaluating them carefully, and then throwing them against the wall.
We need to find new ways of attracting both non-consumers and current listeners and making them passionate about what we offer. We do this by creating uncontested market space for growth, rather than continuing to attempt to compete in a vicious sea of competition in a shrinking profit pool. This technique is called Blue Ocean Strategy. Radio is in the bloody, shark-infested “red” section of the ocean, fighting with itself and constantly emerging competitors. It should be creating new, innovative, never-before-heard concepts to draw new audience in the clear “blue” section of the ocean. Radio needs to Blue Ocean its world. We need to stop thinking about how we can get people to listen to our clusters’ weak stations a little more just so we can squeeze in six more minutes a day and marginally increase our time spent listening (which is generally pointless or at best a stalling tactic) but instead think about what role radio might play in the lives of consumers in the media world in which we increasingly live. Use this process to develop new types of programs within existing stations or totally new formats that don’t rely on music, stop sets, and the rules of the last 40 years. This does not mean throwing out good principled programming “rules” (throwing the baby out with the bathwater), but it does mean setting up a small tub next to the big one in which we can play with new ideas (smartly experiment).
To that end we need to ask: What groups of consumers are there that don’t listen to radio or do not listen a lot? What interests and excites them? What media do they consume and why?
We should also rethink how we segment the audience. What segments of the population are not currently served by the media landscape as it stands now? Perhaps we should set aside the traditional demographics we use to segment audience and start examining how our country is reorganizing along nontraditional lines. Rural/Urban, Secular/Religious, etc. Are there lifestyle segments that might be passionate if they were served? Are there new ways of segmenting political segments versus the traditional conservative, moderate, and liberal? Does the move to the left and right in many media create an opportunity in the middle?
What kinds of formats that radio does not or only minimally offers could create new interest in the medium? Could there be talk radio targeted at women? Does the popularity of Dave Ramsey suggest a full time personal finance station? Could radio play a bigger role in the emerging podcast market by having a format devoted to the leading podcasts (on FM)? Is it time to bring back progressive talk radio? Could a well done national financial news-focused news/talk station find success on FM (versus being relegated to 1500am) in 2021? Could a Black news network on big FM signals draw a substantial audience? All of these are totally different from radio’s main offerings today or are a clearly narrowing of the appeal in search of a more passionate audience.
And, just as we need to think about our radio programming paradigm, we may need to think even harder about the economics of radio. Can new stations be built successfully on a basis other than selling commercials to local advertisers? Is local spot business the only way of doing it? Would the revenue proposition be different if the product on our stations was entirely different?
We can write off 2020 and go back to normal in 2021, or we can view 2020 as an opportunity to challenge ourselves in 2021 and bring new people to the medium. We can do this by creating new experiences and not mimicking the programming we offer right now. We can do this by creating programming that is so manifestly different that it creates a whole new expectation and is compelling enough to truly impact potential radio consumers and fans.
This blog was originally published by Deane Media Solutions and is reprinted with permission.
This is one of the most thoughtful pieces that I’ve read about where we are and what should be discussed for future growth. I recently wrote that we continually fail to acknowledge that we have the level of distribution that every other medium wants, and we ignore making the painful, or daring changes needed, to take advantage of our mass.
GREAT article, Jon.
This is a terrific thought-starter, Jon.
Part of the experimentation might also involve not only the content itself, but the content-creation model. Is there something to be learned from from the digital space, where so much content is crowdsourced? Could that personal-finance channel you imagined include a mix of station-created or syndicated content along with content created by (and perhaps paid for by) experts in the community? Could a radio station carve out a niche in its community by becoming an aggregator/editor/co-producer/gatekeeper/promoter of what we think of today as “podcasts,” filling its air and its digital/social channels with the best, and providing much-needed curation and discovery service to listeners (and producers)? The old model of a station having to create and control (and pay for) all content may not be the only model for the future. Those willing to experiment will have first-mover advantage in the next iteration of our business.
Thanks for a very thoughtful piece!
Jon…this is brilliant. You nailed it. Broadcasters are trapped in the existing, outdated paradigm, as you point out. But you framed the issues perfectly and offered new thinking. We need to find new solutions, not roll out a new execution of an old one. Well done!
Yes … What a great use of all the translators popping on everywhere, instead of wedging a 3rd music format between two established brands just to hurt them. It’s the place to start for sure. Great writing Jon – thanks!
Jon –
Great article, very thoughtful. In the coming year let’s work on your ideas.
I’d like to run past you what may be a blue sky rather than a blue ocean suggestion. If TV is radio with pictures, why not add video to radio? Instead of using audio content, use audiovisual content, broadcast the audio on the transmitter, simultaneously stream the audiovisual on the website and replace the audio ads with audiovisual ads on the stream? In this way, stations can go after TV and digital ad dollars because stations could now sell audiovisual ads using their ratings in direct competition with TV and offer advertisers independently measured local ads — something digital networks can’t do.
With this approach, there’s also a way to generate pay-per-view revenue. A station can broadcast a concert and place a pay-wall around the audiovisual stream thereby opening the concert to anyone anywhere with an internet connection and a credit card. The station can sell pre-, mid- and post-roll ads, banners on the media player and product placement opportunities. While a top 10 station may not want to carry a concert, a sister HD station simulcasting the station may be more amenable.
I’m calling the broadcast and simultaneous stream of audiovisual content by a radio station “telestreaming” and I have the patent on it: USRE47819E1.
Video will do for radio what sound did for motion pictures. Your thoughts?
Hi Ronald!
Great topic to raise ; audio-visual ‘radio’ stations.
Back in 2001, I was a presenter on ‘the world’s first internet radio station’ Stormlive (created by Ric Blaxhill, Bruno Brookes, Neale James). I was an ‘E- Jay’…. which meant being on-air constantly in vision even when track was being played. As a TV and Radio Presenter, telestreaming’, as you have named it, has obvious appeal. And there are many variations and ways of delivering audio-visual live shows. As always it’s about bringing all the very best quality ingredients together to be successful – presenters, content, music, topics, guests… plus the business brains and social media & marketing wizards! It needs the right combination of people who are committed to making it work. Absolutely first question is why hasn’t this worked yet? Variations on this idea have been tried. It’s all about the maths (or math for Americans reading this). It can be made great… but can it be made profitable? Of course it can. Question is obviously, how. Depending on what you do, creating excellent video content can be very labour intensive…. but there’s ALWAYS a way. I’ll run this past my trusted go -to editor! Of course certain TV channels do already simultaneously broadcast their live TV as a radio station – Eg CNN. As noted in the original article, the idea is to find a space in the market were making revenue is possible and competition is low. Creativity & ingenuity alert! Personally, I’d suggest speaking to a great successful entrepreneur before progressing this idea ( just one moment whilst I wave my magic wand and Sir Richard Branson appears!) . I’m sure many people are working on this idea as I type. Someone will ‘crack the code’ and make it work, sooner rather than later under current circumstances I’m sure. The right ingredients for this era needs to be identified. Happy to discuss further! Thank you for starting this discussion. And of course… initial article from ‘Mr Coleman’ excellent too!
Jon,
This is a terrific thought piece which inspires new pathways to better serve audiences with greater emotional connection – and creative ways to build better solutions for advertisers who want that strong connection.
When you think of strategies beyond “the five radio music playlists,” liners, sweepers, and spot & dot advertising, you’re now swimming in the “Blue Ocean.”
Can you create new low cost/high-impact brands to be built on secondary and underperforming stations?
Will you create a needed and profitable service for an audience, versus just picking an open music format lane to run an unprofitable jukebox?
Think of those underserved audiences and the strong advertising categories that DO serve them.
Learn how various demographics use various media platforms in a mix – and customize full experiences for them.
Think of key enlightened advertisers (enlighten them) and ways in which partnering on a specialized multi-platform brand experience can be way more impactful (than just a spot schedule, alone).
Now, picture a brand that serves teens and the advertisers who target them. What does that multi-platform experience look like?
Imagine a brand that exclusively serves seniors.
Partner with the top medical/hospital system in your community as the title partner. Envision an EXPERIENCE, that provides information on healthy living, trips for seniors, medical information, learning opportunities, finance and many other content opportunities.
Notice, I didn’t say music….
YET.
Instead of just “picking a playlist” and typical radio “format” – CREATE a powerful, targeted, radio-based, full-platform EXPERIENCE. Decide what you want your brand to do, FIRST. THEN design the elements.
Instead of saying you want to be a soft AC to attract an older audience, reframe this irrelevant approach.
“We are building a radio-driven, multi-platform experience for seniors. It will include compelling, connecting information for seniors – and will provide a major branding opportunity for advertisers in this category.
Will music be a part of this? Maybe it will, and maybe it won’t. Up to you.
Regardless, if music is part of the mix, it doesn’t DEFINE the brand. The overall product EXPERIENCE defines who you are and your purpose.
In this example, the brand might be called “Silver (town name). The positioning statement and partner branding might be something like “Retired & Loving It. Powered by Aurora Health System.”
Versus:
“X105.3 – Your Most Soft Music Station”
Just some thought-starters with specific ideas on how to rethink our emerging opportunities to better serve and generate revenue!
And finally, instead of looking at Radio as a 25 – 54 commodity, think differently – and target differently!
If you notice, I outlined just two opportunities, both of which aren’t even in the 25-54 radio demo!
I can guarantee you one thing. Whether it’s products targeted at teens or seniors, the money is there, and it’s all green.
Follow the money…
Bravo, Jon. This succinctly and rationally makes an important case for using this moment to look at the radio industry through a different lens. I hope the right people read it over the holidays.
I was in Dallas doing jingles when Jim Long introduced us in 1978. You were “borrowing” space at TM. Your instincts and vision have probably sharpened a lot over the years but even 40 years ago, you were able to see the real world with your feet on the ground. As always this says it all. Appreciate all the years you have lent your wisdom to our industry. Craig Scott Savannah GA
You were in Memphis and you asked me about the future of music on AM radio. I remember that meeting very well. I don’t think I had a good answer.
Your answer was probably about as good as anybody else’s back then. No one had an answer to the AM erosion problem back in 1978. Were it not for the arrival of a “Rush” a few years later, there wouldn’t have been any lingering questions, and certainly no answers.
Stay well and happy Jon. Craig Scott
Outstanding. I listening recently to the Knowledge Project podcast with which featured an interview with leading management and business leader Roger Martin.
https://open.spotify.com/episode/4YLJMfAUPz7MLnVJsrnfMC?si=NqjBs-phStG5fXslCXu0Xg
Martin said:
“No new idea in the history of the world has been proven in advance analytically…yet most companies insist on proof before doing something.”
Radio people ask “Who else is doing it?” as they are only willing to try something unless others have done it and it shows promise. Not everything has to be 100% data-driven and uber rational. Companies that insist on this fall into the trap of limiting innovation and stifling creativity.
Terrific thought and writing as usual, Jon. If we as an industry keep doing what we’ve always done, we’ll keep getting….less and less.
Amazing Insight! Great Article. We are truly living in the times that history will judge as the “Rise or Fall” of the entire medium. #OnWard
Very compelling. It’s time past time to discuss the various ways to adapt and talk about function vs form.