"If the rate of change on the outside exceeds the rate of change on the inside, the end is near." Jack Welch
"All of us failed to match our dreams of perfection. So I rate us on the basis of our splendid failure to do the impossible." William Faulkner
"There's a saying among scientists, that you don't know you've got a really good idea until at least three Nobel laureates have told you it's wrong." Paul Lauterbur
The brilliant Bob Henabery, my creative godfather, often suggested to me that to understand the contrarian mindset one must be able to grasp "driving on the other side of the road." He was right.
Another mentor, the gifted genius Jim Yergin, frequently called me out on my use of metaphor, to wit: "By using analogy, injecting metaphor, what you are doing is avoiding the hard work of thinking. It tells me that you have not developed your thought to the point that you can articulate it clearly without secondary reference." He was right.
2010 should be a time of incredible opportunity for broadcasters. A game-changing moment when the most creative people working in professional audio and video take charge and take the lead in the brave new world of digital, always on audio and video. After all, they have an urgent need to make something happen.
Instead, we are witness to those without professional broadcast provenance taking charge: Pandora leads the emerging music audio space and YouTube leads the space that is becoming the new video.
How did it happen that broadcast professionals witnessed the take off and have continued to watch the early flight of these new players without mounting any significant response? What has enabled these amateurs to succeed, to make progress while the incumbents, the broadcasters, have, or so it may be argued, simply watched?
My sense is Pandora and YouTube have dared to dream.
They are learning to fly right before our eyes (and ears). What were once dismissed as "pigs on the runway" have taken flight and they're now on the radar.
While they may represent the best known entrants into the new audio and video spaces, they are not alone, they're only two of the increasing many that share a charter - reinventing media and radically changing the mediascape as we know it.
Next, I will offer a point of view and some suggestions for how broadcasters can and should move forward in this brave new world. As always, your comments are welcome and encouraged.
Friday, December 07, 2007
"It is not enough to conquer, one must know how to seduce." Voltaire
"News is what somebody somewhere wants to suppress. Everything else is advertising." Lord Northcliffe
"You take one fact, turn it this way and that, look at it in different lights, and feel for the meaning of it. You bring two facts together and see how they fit. What you are seeking is the relationship, a synthesis where everything will come together in a neat combination, like a jig-saw puzzle...In fact, it is almost like listening for the meaning instead of looking for it." James Webb Young
Congrats & cheers: CBS Radio CEO Dan Mason for standing up and providing some long overdue leadership...
“Radio is king –- there is no media that can better deliver more targeted, personalized messages to audiences and advertisers"
Read more via Kurt Hanson's RAIN, here. Jeffrey Yorke also offers up the Dan Mason/UBS story via MediaWeekhere.
The first tribe of wireless continues to suffer from a crisis of confidence, a tradition born of low expectations and poor self-esteem.
The original, and best of class, medium for reach, radio, created its own problems when it elected to become the first and only media to employ the value proposition of time spent. Radio wasted decades failing to learn, accepting the status quo, content with single digit shares of the ad spend. Each new management cohort ran their mouth about growing the pie. Remotes, endorsements, co-op, recruitment, vendor, non-spot, co-pros, event marketing, online, step right up, it's NTR du jour. These initiatives, however well intended, have failed to grow the business.
We have confused activity with progress
We can thank Arbitron for the coming measurement reboot (PPM) and the related new dawn of selling radio's heretofore most valuable yet hidden asset - reach. It's back to the future and Westinghouse NuMath (kudos to Jim Yergin the brilliant media researcher who first gave us a credible reach tool thirty-five years ahead of his time). Kevin B. Sweeney, founder of the RAB and my sales mentor, was also way ahead of the curve. Kevin taught us to use one and only one Arbitron data point - weekly cume. It was Kevin's notion to use our circulation number in making the case against the dead tree guys. On the day job we continue to employ, teach and coach Kevin's legendary and very effective four-point pitch. Kevin's consultive selling template is still valid, robust as ever. Truth be known too many are merely talking a good game and as my friend and former partner the great Joe L. Floyd used to say "Talk is cheap, whiskey costs money."
Price has become an objection because we have failed to articulate value
The single biggest challenge facing the radio business is remaining a relevant (i.e., valued) advertising and marketing platform. While the radio business continues to produce impressive margins and free cash it has failed to show growth and growth is the bitch goddess of Wall Street. Absent real growth the radio stocks remain unattractive, poor investments. No amount of creative financial engineering will save the radio stocks. The publicly held radio outfits have to save themselves and the work that really matters must happen in the field. The catalyst Farid needs to drive CDL up (free and clear of being a penny stock) resides within his sales organization, or not.
What is demanded today is the ability to consistently articulate and proof a credible value proposition. Facing another year of flat (or down) ad spend radio must reinvent sales. Our sales managers and sellers need a new format. Radio sales is beyond the point of effective reboot, what it needs now is a new OS. We must stop training sellers to make calls they're never going to make. Leadership must stop making excuses and start producing results.
A massive failure of imagination
Leadership must be held accountable for growing share, for driving topline, for producing results. As has been stated here previously, this is an issue of critical strategic importance. The mission and metrics must be focused on changing the denominator. Continuing to invest time and precious resources into driving the numerator simply will not get the job done, in fact, it's a potentially deadly error in judgment. It's not about getting better, it's about getting different. Radically different.
Whereas once upon a time you could count on the sales department to buy the time needed for programming to develop and deliver the numbers, today we too often witness the sales department killing programming. KOAI, Dallas is but one example. After a nineteen year run in north Texas the smooth jazz format was dumped because "sales couldn't sell it" or so I have been told. Iatrogenic format extinction. The error larger than blowing up a three share station the sellers have lost faith in might be keeping a one share station on life support - cluster detritus - because the costs of creating the inventory have been minimized (along with bcf expectations). Then again perhaps these are each results of a modern day Hobson's choice. (Disclosure: I once worked at KOAI).
Radio folks need to stop going to work everyday with the same tired single minded mission of killing the guys across the street. Radio folks obsessed with killing other radio folks is now killing the business where before this activity only suppressed the share of ad spend. Competitive media are not significantly involved in radio's revenue stagnation. The silo is being collapsed thanks to improvements in internecine warfare. Advances in competitive monitoring have actually worked to narrow the field of prospects limiting the acuity required to grasp and understand the full ad spend landscape. The danger here is as national advertisers move dollars away and local online platforms (e.g., Google, Microsoft, Yahoo, Craigslist, et al) increasingly capture more local direct dollars - the nightmare squeeze play happens. Fighting for share of fewer and fewer accounts while failing to develop new categories...inertia, attrition and entropy take over (with assists from denial and genetic blindness). It doesn't have to be this way. Radio can and should be a growth business.
We need to face reality as it is, not as it was nor as we wish it to be. Radio enjoys an effective and powerful reach, what we lack are the evangelists who can tell the story, articulate value, under-promise, get the order, over-deliver, keep the client, grow the business and teach others how to do it. We can do this. Game on!
"If the rate of change on the outside exceeds the rate of change on the inside, the end is near." Jack Welch
