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Why The Plenti Loyalty Program Failed

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Tuesdays With Coleman

On May 4, 2015, American Express announced the launch of a “coalition loyalty” rewards program called Plenti.  A coalition loyalty program offers incentives to customers of two or more businesses in exchange for user data.

Plenti Loyalty Rewards Program

On April 16, 2018, members received an e-mail notifying them of Plenti’s demise.

What went wrong?

American Express should be commended for its ability to bring a remarkably wide variety of brands together to participate in Plenti. These brands included Macy’s, Chili’s, Direct Energy, Hulu, Nationwide, Enterprise Rent-A-Car, Expedia and AT&T.

One by one, companies dropped out of the program until it caved completely.

As many radio stations we work with understand, building a coalition is no easy feat.

A News/Talk station may learn via research that fans of one show are not fans of another.

Adding 90’s Country to a Country station may take away appeal from an on-air mix based on Contemporary Country, but adding 00s Country may add appeal.

That’s why our clients are able to utilize research to identify coalitions to help them build more cohesive products.

In Plenti, you had a national coalition loyalty program that brought brands together in different categories, with customers displaying completely varying characteristics.

As one analyst put it, “researching consensus on how the program is structured can be a lot like herding cats.”

Herding Cats

I may use AT&T for my phone, but Netflix (not Hulu) for my streaming. Perhaps I’m a member of the Gold Plus Hertz rewards program, so I couldn’t use my Plenti points with Hertz. This pretty much nullifies my interest in the car rental benefit Plenti is offering.

Consumers may be loyal to Enterprise or Nationwide or AT&T, but they’re loyal to them individually because that brand carved out a position and built a relationship with that consumer.

The consumer has the relationship with each individual brand, not with the Plenti program itself – just as listeners have relationships to a single radio station or a single podcast.

There are plenty of other reasons why Plenti failed. These include a clunky interface, low brand awareness and a confusing rewards system, as well a group of companies that each had their own agendas.

But at the end of the day, American Express tried to force a coalition to work. Without clear synergy, brand and product coalitions are destined to fail.

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The Branding Genius Of Trader Joe’s

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Tuesdays With Coleman

Trader Joe’s has a distinct and defined image in a very crowded, competitive grocery space. While most grocery market chains struggle to eke out very small margins, Trader Joe’s profits soar.

How do they do it? Let me count the ways.

IT’S FUN.

A grocery store? Fun?

Trader Joe's Hawaiian Shirts

It’s true, it’s hard not to smile in Trader Joe’s. There’s the quirky music selection playing overhead (think “More Bounce to the Ounce” by Zapp and Roger into “Alive and Kicking” by Simple Minds). The freshly cooked free samples at the back of the store no matter what time you’re there. The employee walking around with the wacky giant question mark available to answer questions. The Hawaiian shirts. The stuffed animal always hidden somewhere in the store for kids to find.

IT’S SMALL.

Read: focused. Far easier to navigate than most supermarkets, yet vastly wider selections than your typical small grocery store. We’ve blogged a few times on the tyranny of choice. Rather than presenting a benefit to the consumer, too much choice and selection often creates nothing more than stress. At Trader Joe’s, you know where everything is and can generally get in and out quickly.

IT’S SYNONYMOUS WITH QUALITY.

I don’t usually buy generic brands. I like Heinz ketchup, French’s mustard and Vlassic pickles. In the typical grocery store, I completely ignore the generic brands for products like these. Piggly Wiggly ketchup? No thank you. I wouldn’t even want to think about where it may have come from.

But Trader Joe’s brands? A totally different story. You trust them—they did their homework and found a better pickle. Trader Joe’s made their generic brands cool, because they made their brand cool.

Trader Joe's Ketchup-Mustard-Relish

THEY READ RIES & TROUT’S MARKETING WARFARE AND LEARNED TO PLAY GOOD OFFENSE.

Rather than being just like Whole Foods, the leader in the healthy, gourmet grocery category, Trader Joe’s found the “weakness in their strength” and attacked it.  Where Whole Foods takes itself very seriously to the point of being stuffy, Trader Joe’s is fun and whimsical. Whole Foods is expensive. Trader Joe’s is gourmet on the cheap. Whole Foods’ color is green. Trader Joe’s is red. As marketing/positioning experts Al Ries and Jack Trout might say, Whole Foods as the category leader is playing a perfect game of defense, while Trader Joe’s as a challenger is playing a perfect game of offense—which isn’t being better than the category leader, it’s taking a different approach than the category leader.

Trader Joe’s isn’t that different from Whole Foods when it comes to the products it stocks. No Trader Joe’s branded products have high fructose corn syrup or GMOs, and their seafood comes from sustainable sources. It’s just that everything else around it is the opposite.

Radio stations find themselves in battles with format competitors every day. It is easy to get caught up in thinking only in granular terms. We both play 80s music, but we’ll do it better than them. We both have big ensemble morning shows, but ours will be funnier than theirs. We both have big contests, but we’ll give away more money or tickets to hotter shows.

The Trader Joe’s lesson is that you beat a leader not by being better. You win by finding the inherent weakness in their strength and creating your points of differentiation. Some of the most successful brands are categories in and of themselves.

Do your research. Find your lane. Define your base position, then create brand depth.

Just don’t wear Hawaiian shirts and ring bells. That position’s already taken.

 

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Why Toys “R” Us Is Closing

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Tuesdays With Coleman

“Digital photography killed Kodak’s business.”

“Netflix put Blockbuster out of business.”

“Amazon put Toys “R” Us out of business.”

When an iconic brand goes under, the blame game always commences.

The truth is, Amazon didn’t put Toys “R” Us out of business. Neither did Target or Wal-Mart.

Toys “R” Us put Toys “R” Us out of business.

My colleague Warren Kurtzman wrote last week about how essential it is for every brand to have a clearly defined base position. But is that enough?

What’s a better base position than “the photography company”? Or “the movie store”? Or “the toy store”?

Kodak, Blockbuster and Toys “R” Us didn’t just have strong positions in their categories, they owned the dominant positions. The problem is, each of these brands lacked positive brand depth beyond their base positions.

An engineer at Kodak actually invented digital photography. In 1975. Navigating the consumer through the digital space using the brand equity of Kodak moments would have been a perfect and natural complement to its base position. Unfortunately, Kodak couldn’t see beyond its history as a film company, and competitors swooped in.

Blockbuster had an incredible, dominating base position. Unfortunately, it had negative brand depth in the form of late fees, which left it vulnerable. By the time Blockbuster removed late fees, it was too late.

If Blockbuster had entered the DVD-by-mail category or streaming category first, the company would quite likely still be around. Blockbuster had the chance to buy Netflix in the early 2000s for $50 million.  Today Netflix is valued over $100 billion, worth more than every media company that’s not named Disney.

Would Netflix have had that growth under the leadership of Blockbuster? Probably not, and that’s the point.

Netflix started as a DVD-by-mail company, but its base position centered around convenient entertainment delivery. All the moves and innovations Netflix has made, including doubling down on streaming and adding original programming, has been complementary to its base position. Netflix added brand depth.

Amazon online bookstore

Amazon started out as an online bookstore that became an online marketplace. Its moves and innovations, including ease of app use, marketing automation, customer service and free two-day delivery, have all supported its base position as an online delivery service.

Toys “R” Us had an enviable base position and an emotional connection to legions of children who wanted to be Toys “R” Us kids.

Where did the emotional connection go?

Although the road would have been challenging, Toys “R” Us could have added brand depth to its base position. It may have been through incredible marketing automation techniques (like Amazon and Starbucks) or hiring an ace social media manager (like Wendy’s). It could have been a research program that let kids test toys. It may have been partnerships with kids’ museums around the country.

Not to say any of those ideas would have definitely worked, but Toys “R” Us needed to try long before Amazon posed a significant threat.

Integrating Babies “R” Us into Toys “R” Us stores was definitely not the answer–it detracted focus from its own brand.

Last year, Toys “R” Us CEO David Brandon said the chain hoped to add playrooms where kids could try out toys and spaces for birthday parties.

Unfortunately, they never got the chance to give them a shot.

When we work with radio stations, we illustrate the base position on our Image Pyramid, but also explain the perils of a misguided Image Pyramid–which is what Kodak, Blockbuster, and Toys “R” Us all ran into.

Coleman Insights Image Pyramid

Clearly define your base position. Once you do, never stop adding brand depth.

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Be True To Your Base Position

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Tuesdays With Coleman

Does your brand have a base position? No matter what industry, whatever the size of the company…you must have a clearly understood base position.

When we work with radio stations, we often refer to the foundation of our Image PyramidSM—the base music or talk position. For the other components of the pyramid (personality, specialty programming, contests, marketing, news and community) to enhance the performance of your station, listeners must instantly understand the basics of your brand.

Coleman Insights Image Pyramid

Is it the rock station? The sports station? The hit music station?

It’s not only essential for listeners to understand your base position in a simplistic way—you have to understand it as well. It has to be in the fabric of everything you do.

My wife Sharon and I are “foodies” who love to explore the burgeoning restaurant scene where we live in Raleigh, North Carolina.  One of our favorite restaurants clearly has a base position.

Royale is a French-American bistro that opened in November 2016 and at the time, the only way to make reservations was via Instagram. The menu was limited, with no more than five or six entrees choices available. Still, the food was delicious, the service was outstanding and the atmosphere was hopping. After one or two visits, you couldn’t help but have a strong and clear perception of what Royale was all about.

Royale Restaurant Raleigh

Royale/Raleigh, North Carolina

Royale is a hip, downtown Raleigh hotspot with high quality French-American food.

That’s their base position.

Over five or six dining experiences since, we have observed changes to Royale.

You can now make reservations online—albeit only on Resy, not on OpenTable—or even by phone. The menu includes more choice while retaining its distinct French-American flavor. Heck, they now even have a nightly special.

These changes allowed Royale to broaden and become more mass appeal without compromising their base position.

By evolving and staying true to their base position, Royale added brand depth—similar to how a radio station adds brand depth with personalities and contests. Just as radio stations need to establish a clear understanding of their base position before focusing on other elements, Royale set a defined expectation of what the brand stands for.

Restaurants have a wide range of strategic options at their disposal, just like radio stations.

Royale could have looked to expand their customer base by, for example, lowering prices. That would have compromised the quality promise in their base position. They could have started accepting coupons or expanded their menu options outside of French-American cuisine.

Coupon

These moves may offer short-term gain but in the long run would be severely detrimental to the brand.

Just like restaurants, radio stations evolve and add brand depth. That brand depth, however, has to be in concert with the base position or it will erode the brand.

It’s as true in the restaurant business as it is in radio. When you add depth while remaining true to your brand, the sky is the limit.

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Reducing Friction On Your Radio Station – Part 1

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Tuesdays With Coleman

Friction is a hot buzzword in marketing these days. It refers to obstacles in the customer experience.

Can’t find the “submit” button on a form? Friction.

Pop-ups getting in the way on a website? Friction.

Pop Up Ads

Getting charged unexpected fees? Very irritating friction.

Are you adding friction to your radio station?

Radio Station

How much has changed in the ways radio station personnel deal with listeners?

Still asking for caller 9 to win a pair of tickets to the home show, only for the listeners to get a busy signal?

When a listener wins from a town an hour away from your studios, do you tell them you’ll mail the prize or do you tell them they have to pick it up because “that’s the policy”?

Do you make fun of “prize pigs” and tell them they can only win every 60 days, essentially inviting them to listen to another station? Or, do you celebrate people who are actively engaged with your content?

When a listener makes a request, do you tell them, “I’ll see what I can do”, or “I’ll get that right on for you” or “It’s coming up” (even though it isn’t coming up for 15 hours)?

Does your website make it easy to connect with the team, from the General Manager to the jocks? Is there an easy way for them to provide feedback?

Are you engaging with your audience on social media or using it as an advertisement, leaving their comments hanging?

Are you only allowing people within your metro to stream the station (and is that worth it)?

Are you paying attention to the spots and promos on the stream? Is it playing the same PSA over and over again, making it unlistenable?

What do Amazon, Southwest Airlines, Nordstrom, and your radio station have in common?

They are all brands.

What if you treated your listeners the way those brands treat their customers?

Strong brands research, develop a plan from the findings and execute the plan.

Research

Friction is the enemy of plan execution.

Next week in Part 2 of “Reducing Friction on Your Radio Station”, we’ll discuss how radio stations can reduce friction by utilizing research to present a more cohesive product.

 

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How Research Won The Super Bowl

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Tuesdays With Coleman

In the week leading up to the Super Bowl, my colleague Jon Coleman hypothesized why New England Patriots head coach Bill Belichick would be a great radio programmer. In the big game, it was Philadelphia Eagles head coach Doug Pederson who got the better of Belichick in a 41-33 victory.

The post-game perception of Pederson was that he one-upped Belichick by stepping out of the box. Way out.

There was this post-game headline:

Doug Pederson Dethroned The Patriots By Taking Every Risk

Pederson has always been perceived as a risk-taker. Other Pederson headlines over the years:

Doug Pederson’s 4th Down Calls. Crazy, Or The Right Thing?

Doug Pederson’s Risky Decision To Kick A Field Goal Paid Off For The Eagles

Doug Pederson’s Go-For-Broke Style Could Give Patriots Fits

Risky. Crazy. Go-For-Broke.

Here’s the crazy thing.

What if Doug Pederson isn’t a risk taker at all?

By NFL definitions and perception of most, the Eagles coach is one who takes extreme risks. The NFL is later to the analytics party than some other sports. But like Major League Baseball (see: Moneyball), every NFL team uses research data in their operations. The difference between teams is how they use the data.

Most teams are using data for player evaluation and acquisition (the basis of Moneyball). They are using it for injury prevention, leveraging the data alongside sports science to keep players healthy.

What many teams have failed to adopt, according to Sports Illustrated’s piece, “Analytics and the NFL: Finding Strength In Numbers”, is game-day analytics that influence in-game decisions. Ironically, that 2017 article mentions that there’s little evidence of the Patriots’ investment in analytics and that Belichick “does it with intuition”.

That’s how the Philadelphia Eagles beat the New England Patriots.

With the Eagles up by 3 with 38 seconds in the half facing a 4th and goal from the Patriots’ 1 yard line, the safe route—the one seemingly without risk—would be to kick the field goal and likely take a 6 point lead into the locker room.

2017 Regular Season 4th Down Conversions:

NFL 2017 4th Down Conversions

A look into the numbers would show that going for it on 4th down wasn’t as risky as it may appear—the Eagles converted 65.4 percent of the time during the regular season (behind only the Jaguars and Saints, two other playoff teams). Plus, by converting the touchdown, the Eagles increased their win probability by 15%. The numbers said go for it, so Pederson did (with a trick play that had been practiced numerous times). Also note the Eagles attempted 4th down conversions twice as often as the Patriots.

Remember when Pederson went for it on 4th and 1 from his own 45 with 5:39 remaining trailing by 1? Going for it then looked even nuttier than the previous example, but believe it or not was the less risky play.

Leveraging their success in those situations, looking at the league average, and the fact that simply by converting that one single play increased their chances of winning by 7.3% made it not just the right play, but the less risky play.

Brian Burke of ESPN Analytics called that play a “bold, but calculated decision that paid off”.

Bold, but calculated.

In a clairvoyant article before the Super Bowl, The New York Times demonstrated how the Eagles used analytics to get there. What’s notable is that instinct is still very much part of the equation—it emphasized that “the Eagles have empowered Pederson to make decisions rooted in instinct or math, or both”. Eagles owner Jeffrey Lurie says of his coaches’ use of research, ““He can do whatever he chooses to do, but when you have the resource of data, why not?”

While sports has only started to use research as a tool to develop winning strategies over the past couple of years, radio stations have been doing it for much longer (our founder started providing insights in 1978).

Are you making data-influenced decisions in your strategic plan? Every day you have crucial programming decisions to make. How you present the audience with station components like music, personalities, contesting, and marketing – the foundation of our Image Pyramid – can be left strictly to intuition, or influenced by data.

Coleman Insights Image Pyramid

It’s possible while you’re programming on intuition alone, your competition is making data-influenced decisions.

It’s how even the great Bill Belichick got beat.

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Is Your Music Changing With Your Audience?

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Tuesdays With Coleman

After working as a Program Director at radio stations in various formats over the course of 20 years, I was fortunate to be involved in my share of research projects.

Six months ago, I began my new role as an Associate Consultant at Coleman Insights. I work on projects for radio stations in just about every format in markets of various sizes. I’d like to share a few things that have sparked my interest and attention on the research side:

Listener tastes can change in relatively short periods of time.

While I often had access to music research, I was sometimes limited to working with “safe lists” (lists of songs that have done well in the format that should, in theory, be safe to play). There were songs some people felt we didn’t need to test because “they always test well”.

It’s fair to say there are songs that generally do test well just about everywhere. But it’s also fair to say that tastes change and vary by station and market.

One of the first FACT360 Strategic Music Tests I’ve had the opportunity to analyze was for a Country client of ours. In that test, we found that 34 percent of the songs testing in the Top 200 had changed from the previous test. A year earlier, this rate of Title Turnover was 25 percent, meaning the rate of change increased.

Title turnover

The sound of the radio station stayed consistent because this client knows that a music test should not dictate their music strategy. That’s what their perceptual research is for. But, with 34 percent Title Turnover in the Top 200 and 41 percent in the Top 150, this station—by conducting regular library testing—is staying on top of what’s appealing to their listeners in their market and they can play the right songs at the appropriate levels.

History can reveal changing listener tastes when reviewing Billboard Hot 100 charts.

I once had a General Manager tell me to look through Joel Whitburn’s Hot 100 Charts book to look for ideas of songs to play. True story! And yes, you can get ideas of songs to play from year-end charts. On the other hand, if all the #1 year-end songs were on the radio, you’d be hearing “The Way We Were” by Barbra Streisand, “Physical” by Olivia Newton-John and “Macarena” by Los Del Rio more often.

They were the #1 year-end songs from 1974, 1982 and 1996, respectively.

The number one Hot 100 song of 2017 was “Shape of You” by Ed Sheeran. The number two song was “Despacito” by Luis Fonsi & Daddy Yankee (featuring Justin Bieber). Will one, both, or neither stand the test of time? Only time will tell. Music testing will help determine their longevity on your station and in your market.

Artist appeal can change.

When I programmed WBBB/96rock in Raleigh-Durham during the 2000s, Grunge was a consistently strong-testing sound and it wasn’t unusual for us to get at least seven Pearl Jam songs to test. “Even Flow”, “Alive”, “Jeremy”, “Better Man”, “Daughter”, “Black” and “Yellow Ledbetter” were staples in rotation.

In a recent analysis of what songs have stood the test of time based on Spotify airplay, the author makes note of how Pearl Jam has been “lost in time”. While testing results can be completely different at another station in another market, two separate FACT360 studies of a Rock station we work with showed five Pearl Jam songs testing in the Top 200 in 2015. In 2017, there were only two.

2018 brings fresh data, new trends and insights and I can’t wait to dig in! Keep your eye out for a new blog each Tuesday.

 

 

 

 

 

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Holiday Gratitude

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Tuesdays With Coleman

For the final blog post of 2017, our three Senior Consultants—Warren Kurtzman, John Boyne, and Sam Milkman—sat down for a roundtable chat to reflect on some things they are thankful for this holiday season.

Coleman Insights Warren Kurtzman Jon Coleman John Boyne Sam Milkman

Executive VP/Senior Consultant Sam Milkman, Founder Jon Coleman, Executive VP/Senior Consultant John Boyne, and President/Senior Consultant Warren Kurtzman

SAM MILKMAN:

We have very special relationships with our clients who treat us like partners – and often like family. I’m grateful for our partnership with all of them.

WARREN KURTZMAN:

For all the missed connections in airports, late nights analyzing data…

SAM MILKMAN:

Wouldn’t trade it for anything.

JOHN BOYNE:

You mentioned the partnership, Sam. That really is what makes this rewarding, right? I feel grateful that so many clients consider us to be part of their strategic brain trusts. I love it when they reach out in between projects to get my outside perspective on things.

SAM MILKMAN:

That’s what it’s all about. Of course, I love rolling up our sleeves with our clients and helping them find a clearer path to success. When it all comes together – we follow a plan, invest in marketing an idea both on and off the air.

JOHN BOYNE:

Marketing is a great point. We’ll often have client calls to discuss marketing strategy. It helps to ensure that the message is aligned with the insights gleaned through research, but it’s also fun to bounce ideas around with others who are intimately familiar with “The Plan.” These conversations happen no matter what the level of marketing resources are at that time. Within the past couple of days, I’ve had a couple of clients calling to talk about their Q1 marketing message.

WARREN KURTZMAN:

I’m also grateful that we can tap into the brainpower of our founder, Jon Coleman. He’s seen so many scenarios, in virtually every format, and we’re not shy about asking his opinion when it comes to data interpretation and developing strategic plans. It’s pretty amazing to have the opportunity to learn from him every day.

SAM MILKMAN:

I’m grateful that consumers continue to rely on radio, even in the face of rapidly expanding entertainment options.

JOHN BOYNE:

We feel very fortunate that radio companies are investing in the growth of their product through research. There’s never a dull moment. There are always new things to learn, new ways to get better.

SAM MILKMAN:

And I’m grateful we’ve been able to invest as well!

WARREN KURTZMAN:

We’ll continue to invest in new technology and new ways to glean insights from consumers. We added three Associate Consultants to our team over the past year—Jessica Lichtenfeld, Meghan Campbell, and Jay Nachlis. As I’ve mentioned before, we’re bullish on the radio industry and are thrilled that we were able to add more brainpower to the team and another layer of service for our clients. On that note, I have a huge level of gratitude for everyone that works at Coleman Insights. We have a team of more than 20 individuals dedicated to providing our clients with the deepest insights and the highest levels of quality and service in the industry and I’m very proud of them.

SAM MILKMAN:

Coming back to our clients, I appreciate that we have the kind of clients who push us to question our assumptions. My father used to tell me, “No one has a monopoly on the truth.” He was trying to teach me that there isn’t just one way to see things, that you need to look at things from lots of different angles to find a solution. And I think our clients demand the same sort of intellectual vigor.

WARREN KURTZMAN:

Ultimately, that pushes us to challenge ourselves, and invest in new ways of doing things.

 

For January’s first blog, Warren, Jon and Sam will continue their discussion by sharing their thoughts on radio and research in 2018.

From everyone at Coleman Insights, have a festive and safe holiday season and  Happy New Year!

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Is Inside Thinking Blurring Your Strategic Vision?

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Tuesdays With Coleman

If you work at a radio station (or in any business, for that matter), it’s easy to get caught up in Inside Thinking. We sometimes get too close to the product for our own good, and are unable to see it through the lens of our customers. When you’re the manager of a radio station, this can lead to blurred strategic vision, exemplified by statements such as, “We just need to know what’s most popular with 25- to 39-year old men because that is our target.”

Is that really enough?

This is the final installment of a four-part series that revisits a Radio & Records column I wrote in 1999. It describes scenarios I ran into when speaking with radio station managers about research projects. All of these scenarios, including Scenario 4 – No Strategic Vision, still come up with regularity 18 years later.

The inability of some managers to look at their stations from any other perspective than from inside the stations’ walls manifests itself in Inside Thinking. These managers believe that listeners:

  • Care deeply about radio
  • Are paying close attention to our stations
  • Can be manipulated

Conversely, Outside Thinkers believe the opposite. They understand that listeners’ station choices are:

  • Driven substantially by habit
  • A result of instantaneous need fulfillment
  • Based on a simplistic set of perceptions they have of different stations
  • Impacted by the role of language
  • Determined by their lifestyle

Listening to radio station

This very different mindset leads Outside Thinkers to approach research with a much more strategic point of view rather than simply trying to find out what listeners do and do not like. They use research to ask questions like:

  • What is my station’s awareness level in the market?
  • How different is my actual product and what people perceive my product to be?
  • Where do the musical tastes of my market really lie and are they moving in the direction that I believe they are?
  • Does the fact that my target demo share dropped by 25% over the last two Nielsen books really mean that my position in the market has weakened?
  • Am I focusing my energy and my resources on the right things?

Our suggestion that radio managers take the Outside Thinking approach to their stations—and their research—provides a good final thought for this four-part blog series. Our previous installments warned against obsessing over methodology, not investing in research when your station is successful and confusing tactical and strategic research. Outside Thinkers rarely make these mistakes, and as a result, their stations are far more likely to enjoy long-term success.

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Why Successful Radio Stations Need Research

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Tuesdays With ColemanThis week, we continue with part 2 of a blog series that revisits a column I wrote for Radio & Records in 1999 found while digging through the Coleman Insights archives.

Radio and Records

Despite significant changes in the industry over the past 18 years, I’ve been struck by how little some things have changed. I discussed four scenarios in which radio managers fail to get the full benefit of conducting research on their stations. This week, we’ll put the spotlight on:

Scenario 2 – We Have Great Numbers: A program director dismisses any need for conducting research on her station by citing its performance in the latest Nielsen book.

There is no question that Nielsen represents “the bottom line.” I worked for Arbitron, which was acquired by Nielsen in 2013, for six years and experienced how significantly the company’s data impacted radio stations first hand. This experience—and my contact with the company since I left there in 1993—taught me a great deal about the quality of the information they provide, even if there is always room to improve it.

Using Nielsen to assess how your station is doing, however, is not a very good use of their data. In fact, it is downright dangerous. Listener appetites and the competitive landscape can change so quickly that what Nielsen reported in the fall book might have little bearing on the winter results. It’s also been my experience that ratings performance and the strength of your position are not perfectly correlated.

Let’s play out a hypothetical situation. Let’s say you’re in charge of an Adult Contemporary station, currently number one in your target demo. When it comes to music, you’ve got a lot of room to play with and your playlist covers various segments of the format spanning four decades. Your morning show gets decent numbers, but at-work listening is where your station really shines. With things going so well, it would be easy to say, “Why do research”?

There are a couple of things that tend to remain constant in radio. First, you probably won’t stay on top forever. Second, if you are at or near the top, a competitor will likely try to slice into your success. What if you knew, with a great deal of clarity, where your own strengths and weaknesses lie? What if you knew the strengths and weaknesses of other stations in the market? What if you knew if the musical tastes of the market were changing? What if you knew that the awareness level and appeal of your morning show wasn’t as high as you expected? What if you discovered the broad nature of your playlist made you vulnerable to a more focused attack?

Would you rather have answers to these questions before your radio station is attacked?

A perceptual study—at Coleman Insights, it’s called a Plan DeveloperSM—can  help shore up your fort before it is too late to discover your vulnerabilities. Perceptual research can also discover what your brand stands for in the marketplace.  Stations with strong brands are far more equipped to withstand ratings wobbles than those without. Focusing on the next ratings book is a short-term strategy.  Focusing on research that builds your brand is a long-term approach built for long-term success.

What kind of research should you do and is it giving you the results you need? Furthermore, are the results being interpreted properly as part of a larger brand strategy? Next week, we’ll focus on Scenario 3 – Confusing Tactical and Strategic Research.