From The Corner Office – January 2011

January 1, 2011

Radio Resolutions

Happy New Year, and welcome to 2011!

I trust that all of you had a moment or two with family and friends to decompress from the burdens of the year past, and are prepared for another exciting ride as our industry continues to embrace and adapt to the changes of a digital and integrated world. I have had some time myself to reflect on the challenges we confront as this year opens.  I want to share some of them with you.

The Digital Dashboard Goes Mainstream. As you read this, visitors to the Consumer Electronics Show will be playing with the newest gadgets and electronic technology for the dashboard.  Many suppliers will display a selection of Pandora-friendly in-dash radios, the availability of which will expand dramatically in the coming year, at affordable prices. Auto and radio manufacturers will also expand compatibility beyond Pandora, allowing for in-dash control of other apps on other devices besides iPhones.  In March 2011, new models from BMW will debut which will be capable of integrating the BMW iPhone app.

In-car connectivity is here and radio needs to be in a position to capitalize on this trend, extending our interactivity to the dashboard to go along with our broadcast coverage.  We need to spend time with our listeners and determine what they wish to communicate to us and how they want to participate with us, and we need to build capability to make in-car radio not only great HD quality but both interactive and safe as well.

Radio’s greatest gift is its ability to push content in a reliable, mass, secure fashion with our on-air broadcasts. We need to pair that with a new capacity to not only target our content using addressable HD technology, but also incorporate interactive one-to-one relationships using the mobile web. This confluence of technology allows us to not only maintain but expand and deepen our relationship with listeners and advertisers in ways we have not yet tapped. We know from experience that targeted advertising is more welcome, less intrusive and more effective than a broad-demo scattershot; we need to adapt that knowledge and take it to a new level of targeting to individual likes and tastes.  The evolution of dashboard connectivity will be a significant contributor to that goal.

HD Radio Expands Our Possibilities. As the cost and power consumption of HD chips comes down, it becomes more attractive to receiver manufacturers and consumers. The power increase has eliminated many of the early coverage issues, and the creative use of HD for the transmission of data along with audio has been proven by the Broadcast Traffic Consortium, in partnership with NAVTEQ, now distributing traffic information to nearly 90 broadcast markets.  This is a first step in using our spectrum not only for our traditional audio services, but to make an interactive, personalizable stream of data available to individual listeners. We need to push forward in this area.

Why the emphasis on these new technologies? I believe that the days of the one-size-fits-all approach to our local station brands is giving way to a more customizable menu of ways that our listeners can choose to utilize our station brands. I believe that the days of broadcasting’s monopoly on people’s ears while driving are limited and as new technology forces its way into cars, we need to adapt and improve our efforts. It is not in any way, shape or form that radio is becoming irrelevant; but to stay relevant and vibrant, we must adopt new approaches.  We must adapt, and not just react.

We also have to reexamine and change our mindset with which we do business. Markets are evolving; budgets are shifting; we need to adapt, not just react.

We need to sell solutions, not spots. I have said many times, the days of selling :60s and :30s is well behind us.The transactional salesperson will find their income eroding with each passing month. From what I am seeing, as advertisers reestablish their marketing budgets, they are allocating more dollars for promotions than for advertising, and for programs that produce results rather than simple spot advertising. I am also seeing new and innovative competitors going after those dollars as well as part of radio’s traditional brand advertising. Whether it’s a local cable operator, the local Google sales staff or now the Groupon sellers, there are new battalions of salespeople directly competing for our incomes. We need to examine what value they offer to advertisers and how to respond to their assertions about traditional media, including radio.

We need to create new content, both on-air and online. We need to redefine the component functions of being an “air personality”. Our personalities are now engaged with their listeners on the air, online, and on the smartphone. We need to recognize who are our most important listeners and treat them as such and make them raving promoters and ambassadors of our brands, not just listeners. We need to pay attention to our audio and video on demand and use it to further personalize and deepen our relationship with our listeners. We need to recognize that the choices for their limited time and attention have exploded and the same old format, endlessly repeating, is just not enough for this new year.

We need to integrate.  Rather than look upon all of these new developments as additional work to be done in addition to our traditional jobs, we need to sit down and reformulate our priorities and focus on our integrated effectiveness. For example, we may not want to continue to invest the time and energy into our weekend programming but redeploy that energy into an original online segment for our VIP members. We may not want to give away no-charge spots in first quarter, but rather incentivize our clients with an integrated online and on-air program that specifically addresses their January and February needs.

It is never easy or convenient to take a step back and reevaluate our structures and jobs, but it is necessary and important work. Otherwise, we run the risk of putting ourselves and our staffs on a treadmill of overload and mediocrity. And that is no way to respond to new and innovative 21st century competition. More is never the answer to disruptive innovation; quality and focus is a far more effective response.

And turning the page to a new calendar year is the best time to step back, take stock and make a few resolutions to commit to a fresh, new, innovative beginning.

All the best to you and your family in the coming year.

I’d love to hear your thoughts about this; drop me a note at AskPeter@greatermedia.com.