"What the customer buys and considers value is never a product. It is always utility - that is, what a product does for him." Peter Drucker

"Life is pretty simple. You do some stuff. Most fails. Some works. You do more of what works. If it works big, others quickly copy it. Then you do something else. The trick is in doing something else." - Tom Peters

"If you are not paying for it, you're not the customer; you're the product being sold." - Andrew Lewis

Today's image: Hey! by Fred Winston. Great shot. Thanks for sharing.

Welcome to September.

As we begin both the last frenetic drive to make our numbers before the 2011 clock runs out and the ritual dance that is the annual budget process, some loose ends for your consideration. As always, your thoughts are welcome.

Start playing the game thinking ahead
two moves or more

Critical thinking and serious listening continue to provide exceptional yields. Paul Drew often said planning afforded the best possible ROI. He was spot-on. Putting scenario planning and game theory to work are but two solid options. Let's begin by asking the important question...

What if?

What if transactional business died?

Spots and dots represent the single most important revenue engine of the broadcast trade but what if, without notice, transactional revenues precipitously declined?

We must ask such prescient questions.

I'm reminded of that famous speech at the 1975 NARM, The Day Radio Died delivered by the gifted Stan Cornyn, then a senior Warner Brothers executive. As it happened, Stan had asked exactly the right question at precisely the wrong time (the record industry, being in high cotton, dismissed his provocative thought experiment).

It's critical that we play ahead.

Here's a practical example deserving discussion: How are we going to optimize political in 2012 and what's our strategy for beating those numbers in 2013 without that cyclical gift? Importantly, what if political allocated to broadcast is reduced or doesn't come back at all in the 2014 midterm or the 2016 federal? Isn't this a perfect time to entertain the notion that an RAB/TvB led task force be established to work these cycles? From K Street to every campaign headquarters, PAC and all of the political consulting firms there are stories to be told, value propositions to evangelize and champion.

On the day job we were criticized some years ago for daring to ask "What if?" Specifically, when the automotive category went south we initiated conversations grounded in the brutal candor of fresh circumstance. We began asking "What if it doesn't come back? What if it does come back and the dollars are shifted, less broadcast and more other including interactive? How then do we compete?" The situation was indeed tragic. Some long established car stores, the majority perennial broadcast clients, closed forever. Time spent in scenario planning paid off. Our clients paced ahead the next two years having developed strategies to replace 60% or more of their local, zone and national auto spend (i.e., dealer, association, factory dollars). Moreover, we developed new strategies and tactics for auto to more effectively employ broadcast and in that process totally reimagined and rebooted the category.

What if your transactional business died? What exactly is your strategy for staying in business? The exercise is important. Rather than wasting time in a hypothetical "losing it all next year" discussion let's first imagine 2012 as the year transactional is off by 12%, your attrition rate doubles, your DSO adds 10 more days and you lose both your top seller and your DOS. What's your plan to deliver your numbers? Ask "What would have to happen?" for us to make our numbers given a set of specific conditions (ninjas of finance call such probabilistic conditions "assumptions"). Using worst-case scenarios can be productive if they are not simply possible but also credible.

We must embrace the simple reality that transactional is, in essence, a commodity business. As such, this segment of media spend is more likely than not to move away from personal selling and into the more efficient realm of machine trading. The strategic issue here is how do we optimize participation in this commodity trading process and at the same time develop a separate sales organization focused on selling solutions rather than numbers? How do we move from responding to an avail to working with clients in a creative collaboration to produce results? We have an urgent need to do both.

Sidebar: During my time with CBS Mel Karmazin asked me to consider putting Howard Stern on one of our Dallas stations. Howard was not cleared in the market at the time. One of my first thoughts was "What happens if the airplane goes down?" Experience had taught me that the best time to look for talent was before you needed them. Fast forward. Howard announces he's leaving and suddenly at risk are ratings at a bunch of stations and what has been estimated to be about 100 million in CBS billing. It became clear there had been no serious succession planning prior to Howard's announcement. History records this as a fire drill where people were sent into the burning buildings.

As the proverb says: The best time to plant a tree was twenty years ago. The second best time is today. Mind the wise counsel of Tom Peters "The trick is in doing something else." Let's get to work.

The major advances in civilization are processes
that all but wreck the societies in which they occur
Alfred North Whitehead

Bonus: Erik Sass provides an interesting overview of what's happening and not happening in American advertising. Winners and Losers: The Changing Media Ad Landscape, 1980 -2011, here.

Flashback: The challenges faced by music radio today simply demand the aggressive employment of innovation and creativity. N=1, August, 2004.

"Fear is a bad adviser." Sergio Vieira de Mello

"Confidence is what you have before you understand the problem." Woody Allen

"Advertising is the price we pay for being unoriginal." Yves Behar

Today's image: untitled by toby deveson. Beautiful. Thanks for sharing.

The Day Radio Died

Stan Cornyn, a senior officer with Warner Brothers records, delivered a famous speech in 1975. His address was titled The Day Radio Died. Stan presented this wake up call at the annual NARM convention, a gathering of record folk along with their distributors and retailers. He said "...radio should not be the only game in town. Records should be." Going on to say "...the record business has sold only what it could get played. Do we, as an industry, really want to confine our sales only to records that can get frequent airplay?" He did understand how critically important radio was to the record business "...if it weren't for radio, half of us in the record companies would have to give up our Mercedes Benz leases."

Stan had the audacity to suggest records urgently needed to find an effective, profitable way of doing business without radio. His suggestion was about nothing short of revolution, about getting dramatically different.

Stan was a visionary. History has proven, his wise counsel was ignored. His peers and contemporaries elected to stay focused on what they knew, obsessed with getting better at the same game.

Back from the near death experience

Todd Storz once saved radio from death. He took a bold and contrarian view - programming to the ignored, listeners not then a cohort of the so-called mainstream - the youth audience. Storz employed powerful accomplices, Rock 'n' Roll, tight rotations and the "closed" playlist. As the brilliant Bob Henabery has written "Sparked by the inventions of the portable transistor radio and Top 40 on the AM band, a generation of baby boomers was galvanized by pop music." Read Bob's excellent writing here.

Once Storz achieved success the herd instinct kicked in, Top 40 swept the nation. As a practical matter the youth radio revolution was responsible for radio's dramatic revenue growth, over 800% between 1940 and 1970. What Storz did was counter to all industry dogma, having nothing to lose he threw out the rule book, he fundamentally changed radio by getting radically different while others were focused on getting better. In a world of rule takers Storz was the outlier, the rule breaker and he became the new rule maker.


Next: We need to rise to the game-changing challenge that history is again presenting to us. The first and second tribes of wireless are now being offered amazing, once in a generation opportunities. My thought is...this moment is rich with incredible potential. More tomorrow.

IF

by Rudyard Kipling

If you can keep your head when all about you
Are losing theirs and blaming it on you;
If you can trust yourself when all men doubt you,
But make allowance for their doubting too;
If you can wait and not be tired by waiting,
Or being lied about, don't deal in lies,
Or being hated don't give way to hating,
And yet don't look too good, nor talk too wise;

If you can dream - and not make dreams your master;
If you can think - and not make thoughts your aim,
If you can meet with Triumph and Disaster
And treat those two imposters just the same;
If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to, broken,
And stoop and build 'em up with worn-out tools;

If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breathe a word about your loss;
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on!"

If you can talk with crowds and keep your virture,
Or walk with Kings - nor lose the common touch,
If neither foes nor loving friends can hurt you,
If all men count with you, but none too much;
If you can fill the unforgiving minute
With sixty seconds' worth of distance run,
Yours is the Earth and everything that's in it,
And - which is more - you'll be a Man, my son!

Spanish red: Vina Mayor, Crianza 2002. Ribera del Duero. A simply wonderful red under $15.

Buzz: Steven Spielberg preparing to launch a new social network said to involve a community around ghosts and ET stuff.

Too early to tell: Chicago's Fresh, the CBS Radio initiative that replaced FM talker WCKG did not best the talkers 25-54 showing of last year. The talkers' 2007 high mark was a 2.5, Fresh just posted a 1.8 trend. Fresh did deliver an in-demo cume of over a quarter mil. Stay tuned.

Congrats & cheers: It's "only a trend" but...Steve Dahl breaks into Chicago's top ten morning shows at #9, 25-54; an outstanding afternoon debut for WLUP's Eddie Webb, #5, 25-54. Fred Winston hired as "special guest star" and debuts tomorrow. Sheryl Sandberg joins Facebook as COO. Gannett bows new glossy FSI OpenAir this Friday.