Category Archives: Radio

Internet advertising closing in on radio

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The Internet will receive a greater share of global advertising spending this year than do outdoor outlets such as billboards, and it is set to overtake radio soon. That’s one of the findings in a report by ZenithOptimedia, a media planning and buying firm. The growth is being driven by smaller brands, which are turning to the Internet because it is relatively cheap and can target their markets effectively. (see The Long Tail) The company said it expected the spending share gap between the Internet and radio to narrow from 3.9 percentage points in 2005 to 0.7 in 2008. (Yahoo! News/Reuters)

If you understand how to market and sell online, this is not necessarily a bad thing. If you don’t… then pray that these are new dollars that won’t impact your sales.

Media Study: Radio Makes People Happy

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That’s one of the findings in a new study by the Radio Advertising Effectiveness Lab. Harris International surveyed more than 2,500 people between the ages of 18 and 54 in June and July. (MediaWeek)

Less Annoying“Fifty-five percent of respondents said radio was the medium most likely to improve their mood compared to the other three media studied. The findings were generally true across all ages, genders, and ethnic groups, but especially strong for African-Americans and Hispanics.”

“Advertising on radio was also found to be less annoying than on other media. Comparing Internet ads to radio ads, 45 percent of respondents said radio ads are “repeated too often,” compared to 53 percent who said the same about Internet ads; 24 percent said radio ads “appear at inconvenient moments,” while 60 percent said the same of Internet advertising.”

The simple truth is most radio stations just have too many commercials. And too many of those commercials have no relevance for me. Yes, I understand that they ALL have relevance for someone… but in an iPod world, that truth is no longer relevant. I have to stop now, I’m out of italics. [Thanks, Chuck]

How to ruin a podcast

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Mark Ramsey points to a classic example of MSM cluelessness (CBS in this instance). His post makes me uncomfortable because our networks produce a lot of programs (newscasts and sports reports) that are comprised of 3 minutes of programming and one minute of commercial.

What if we were only podcasting that program. Would listeners swallow that? I’m thinking not.

Back in the dark old days, when one of our networks was oversold, we’d just jam in more spots and ask stations to air programs that had more commercial content than programming. Shudder.

Mark sums it up nicely:

“In our zeal to monetize our online content, remember that podcasts are downloaded and played voluntarily. It’s because we like you and want more of you. Yes, we’ll tolerate advertising in podcasts – but not 30 out of 90 seconds!”

What new Arbitron rules mean for radio stations

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“When listening is defined as broader than “radio” alone, then you are no longer in the “radio business.” You’re in the business of audio entertainment and information, regardless of distribution channel. That little home-grown Internet radio station from Zimbabwe is now your competitor. When “Listening” is defined according to things that do not require a radio, you are no longer in the “radio business.” Get it?” — Mark Ramsey

My kind of contract

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Roger brought back a copy of the affiliation contract for The Davey Ramsey Show (financial advice?) from the recent meeting of the National Association of Broadcasters. They shove all kinds of promotional stuff under the door to your hotel room every night and this was in Roger’s pile one morning. I’m not familiar with the program but I love the contract. One page (front only). I spent my youth (okay, my middle years) trying to get people to sign affiliation contracts with our networks.

I did my best to keep them simple and understandable. But our attorneys never let me go this far. Here’s the full contract (PDF) and here are a few paragraphs:

Thank you for deciding to include The Dave Ramsey Show as part of your station lineup. Are you looking for a big, detailed contract? They are a pain and quite frankly, we don’t feel like dealing with them. Below you will find afew points that will guide our relationship. Please initial each one and return the contract via fax to 615-372-0573 (confidentiality assured).

1. You like us and we like you and therefore are agreeing to work together. You are going to start airing the program on station (station info)

3. Now that you have decided to carry The Dave Ramsey Show we will not be available for another station in your market. Don’t know why we have to state that we are not interested in cutting our legs out from under ourselves, but I guess this market exclusivity thing is a big deal.

5. Let’s try this. The Dave Ramsey Show should be carried LIVE. We think it is a mistake if it is not aired live. However, we understand that some stations are not able to make this happen. For now that is acceptable. All we want you to do is let us know that after we start winning for your station, that you will consider us for a live slot. You are not guaranteeing us this slot, you are not promising this slot, you are simply letting us know that you will consider it. Come on, is that too much to ask? We should be live anyway.

I don’t know how good this is from a legal standpoint, but it’s good marketing or PR or something. And in my experience, most contracts with radio stations weren’t worth much. My hat is off to whomever wrote this agreement.

Radio listeners don’t mind ads

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Mark Ramsey points to this Arbitron study that concludes radio listeners don’t tune out when commercials come on. And wonders about the implications:

“If listeners don’t mind spots then why should they mind mediocre songs? And what ARE they listening through the spots for?”

The whizzing sound you hear is thousands of radio sales reps emailing the Arbitron study back and forth.

989 people out of 1,000 listen to radio

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Regular readers know I’m a fan of Mark Ramsey’s blog, Hear 2.0. Mark is the president of San Diego-based Mercury Radio Research, which recently conducted a 1,000-person national study of radio listening habits of people ages 12 through 54. Just 11 people said they didn’t listen to radio.

Mark spoke at one of the sessions at the NAB Radio Show, underway this week in Dallas and the Dallas Morning News covered:

“One of the key things that makes radio different from all these others (iPods, satellite radio, Internet radio, etc) and makes it stand out, and valuable, is the fact that there’s stuff between the songs that people value. In fact, the loyalty to the stations, preference for those stations, is driven very much by what’s between those songs. It’s about connecting with other people.”

Here’s Mark’s take on commercials:

“…there’s one group that hates commercials and another that can tolerate them. The issue with commercials seems to be, ‘Look, if you’re a zealot about commercials, well, of course you’re going to listen to an iPod.’ People inherently understand that commercials are a tax that you pay. The issue for radio is whether we demonstrate to them what that tax is buying them. … ‘Are we giving people something that’s worth the price they’re paying in commercials?’

That wasn’t such a scary question when there were no alternatives to the radio.

Note to self: Record a couple of hours of morning drive on one of the local radio stations and edit out everyhing except the “stuff between the songs that people value.”

Comment from Jim M:

“It seems to me the ratio between commercial time and music / content is way out of whack compared to what it used to be. I wonder if there are some statistics on how this ratio has evolved over time? I was thinking about this today, again, when a drive to the store and back treated me to 100% advertising. I like commercial radio for the fact that I can pick up on new music and the variety, but finding music these days seems to be truly hit and miss.”

NAB Radio Show: The Newspaper of the Future

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Scott Brandon’s latest dispatch from the NAB Radio Show (“How to Make Your Station Website the Newspaper of the Future”):

“We begin with internet problems. Not a good sign. Wish I had my camera. Feels like a college lecture hall. The session is led by Paul Coates from Branson. Roger Utnehmer (DoorCountyDailyNews.com) was scheduled to present but had to drop out due to illness.

Really, this thing was all about why to do it (revenue opportunities, audience movement) nothing much about how to do it. More “ain’t this neat” than anything else. Toward the end people started to push him for logistic info. At some point, Coates lost control and the herd took over. Lots of independent conversations and random questions being thrown out and answers coming from the gallery.

Some notes:

  • Traditional newspaper is continuing to decline. That means there is an opportunity to grab those non-traditional readers.
  • Radio can drive people to the web and make money. If newspaper drives you to web, they lose your traditional sub rev.
  • Your website has to supply news not history.
  • You already have news and sports departments.
  • You can charge premium price. Print buyers used to spending lots. Too low and it doesn’t seem worth it.
  • Sky is limit on content.
  • [More internet problems. Everyone in the crowd has advice.]
  • Fresh content is needed everyday and early in the morning. By 5:30 or 6:00.
  • His unique visitors have leveled out but his per-day visits have gone up. On average, each person visits 3 times a day. Guess what? They update the news 3 times a day.
  • “Show-me more” feature on Roger’s site allows sponsors to put up a video of their biz or offerings.
  • Hometowndailynews.com is working on adding a feature to their “area dining” section that will allow you to do on-line orders to your favorite restaurant.
  • Your site should have different name than station. Must be a full stand alone feel. Otherwise, people feel they are just spending more money/time on your station.
  • Did not hire new staff. Shuffle duties of existing staff.
  • Now we’re into legal stuff. Is it legal to link to google? Sigh.
  • Mistakes he made: 1) Have more patience; 2) Sell it to your staff first; 3) Crawl, walk, run”

NAB Radio Show down with New Media

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Scott reports there are at least eight sessions on “New Media” at the NAB Radio Show going on this week in Dallas:

1) Pod Squad – Getting the Drop on Podcasting
2) Text Messaging – Where U @?
3) How to Make Your Radio Station Website the Newspaper of the Future
4) Promotions with New Technologies
5) Harnessing the Power of Blogging
6) Radio’s Future in Focus: What Millennials REALLY Think
7) It Ain’t Just Radio: Where Else Can You Find New and Bigger Revenues?
8) Email marketing

Let’s hope Scott fires up that Blackberry and files some dispatches from a few of these sessions. We’ll post them here if we get ’em. They’ve got some people who know their stuff on the blogging and podcasting panels. (Scottie: Make Roger buy the tapes for those two sessions.)

Radio: “Changing Its Tune”

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I pulled the following excerpts from an article (Media & Advertising) in today’s New Your Times (“Changing Its Tune,” by Richard Siklos).

“While more than 9 out of 10 Americans still listen to traditional radio each week, they are listening less. … As a result, the prospects of radio companies have dimmed significantly since the late 1990’s, when broadcast barons were tripping over themselves to buy more stations. Radio revenue growth has stagnated and the number of listeners is dropping. The amount of time people tune into radio over the course of a week has fallen by 14 percent over the last decade, according to Arbitron ratings.”

“Over the last three years, the stocks of the five largest publicly traded radio companies are down between 30 percent and 60 percent as investors wonder when the industry will bottom out.”

“Clear Channel Communications, the nation’s largest radio operator, is now considering selling some of its 1,200 stations in smaller markets after years of acquiring everything in sight, according to industry analysts. The CBS Corporation did the same thing recently and now says it is looking at further station sales. The Walt Disney Company struck a deal this summer to get out of the radio business altogether.”

” ‘A possible reason is that unlike other media businesses, radio appears to have come late to the game of focusing on viable online business models. Although digital revenues are growing fast, they accounted for only $87 million of the industry’s $20 billion in 2005 revenues, according to Veronis Suhler Stevenson Communications. As an industry, we’ve lost the hipness battle,” said Jeffrey H. Smulyan, the chief executive of Emmis Broadcasting. “Like a lot in life, it may be more perception than reality.’ ” (Mr. Smulyan tried to take his company private earlier this summer in the face of its sagging stock price, down more than 40 percent since 2003.)

“Amid so much uncertainty, it is little wonder that sessions at next week’s National Association of Broadcasters radio convention in Dallas advertise things like: “Learn to steal money from your local newspaper” and “Harnessing the power of blogging.” It is also a sign of the times that the convention’s opening reception does not have a broadcaster as a host. Instead, Google will be buying the drinks.”

Chicken LittleI wonder if this isn’t a very positive trend for broadcasting. Could “small be the new big” here? Perhaps a locally owned and managed radio station could better serve the community than a cog in some monstrous media machine. What if you didn’t have to claw your way up through many layers of corporate org charts (and back down) to try something new? What if it really became about serving the local community and not the share price?

No, I don’t think it’s ever going to be the way it was. But a more nimble, self-directed, home-town radio station might be able to change course faster than the USS Juggernaut.