Radio Stations Aren’t Performing Like it’s 1999

Calendar 1999Remember when spot loads were small, rates were high, profit margins were 30% to 50%+ and revenue growth was double digit. I do.

What Happened?

Change happened.

FM radio replaced AM radio.

And AM radio stations are adding FM translators in an attempt to stay relevant.

An Abundance of Listening Options

Today there are too many radio stations playing the same program features, repeating the same positioning liners and doing the same things that we used to do 30 to 35 years ago.

Pureplay streamers are relentlessly competing for our listeners’ ears.

Listening options are infinite.

The Internet Tore Down the Gate

Traditional media was born when the “gates” to being a media property were very high. For newspapers those high gates consisted of having to buy large printing presses, paper, ink, etc. For radio & TV those high gates were things like having a broadcast license, a transmitter, studios, etc.

Traditional media enjoyed being gatekeepers for news, information and entertainment because there was no place else to go.

Legacy media enjoyed attracting huge audiences, huge margins and lots of cash flow.

The Gatekeepers of the 21st Century

The new gatekeepers are called listeners, readers and viewers of media.

The new gatekeepers are accessing their media via their smartphones, tablets, computers, smartTVs and now voice activated devices such as Alexa, Google, Apple and Cortana.

Bottom Line

Long stop sets no longer need to be tolerated by listeners or advertisers. Every element that goes out over-the-air needs to be thoroughly vetted from the listener’s perspective.

And your streaming product cannot be an afterthought. It’s your future and if you expect it to grow into your new revenue source, you need to give it your full attention.

Listener Supported

Have you noticed the growth of Christian formatted radio stations? Have you noticed the growth of NPR and public radio?

These radio stations depend on listener support as well as business underwriting.

If your station stopped selling commercials and asked its listeners to donate money to support it, would they?

Our Challenge

The challenge for broadcasters is to build audio brands that our audience doesn’t just casually listen to but feels they can’t live without. To do that, your media property needs to know your listener so well, that you are creating a product that they find engaging in every way.

It’s time to play to win again versus a decade of trying not to lose.

Consumers Have a Choice

Here’s the reality of today. Consumers of media have lots of choices for how they want to spend their time. They don’t need us. It’s up to us to create a reason for them to want us, to need us.

NAB Radio Show 2009

Now here’s the ear-opening part of this article.

Most of these points were made during an NAB Radio Show presentation I attended almost a decade ago.

It’s 2018, how many of these issues are the same today?

Why is that?

I’d love to hear your thoughts.

28 Comments

Filed under Education, Mentor, Radio, Sales

28 responses to “Radio Stations Aren’t Performing Like it’s 1999

  1. georgejohnsradio

    I believe Dick that most of the change in radio occurred when the radio station owners of today overestimated the value of radio yesterday. This put the banks in charge and all they care about is cutting expenses.

    Liked by 1 person

  2. Dana Harmon

    Great thought provoking article. Back in 1999, there were not as many choices for consumers. iPod, mp3, satellite radio, internet, Pandora, the list goes on and on. Not to mention mindless chatter, long stop sets and total lack of awareness of how to combat the above mentioned.

    Liked by 1 person

  3. “Traditional media was born when the “gates” to being a media property were very high.”

    It was also a time when trying to get a job in broadcasting meant you had to beat out 150 other applicants, after first spending time in a small market honing your skills.

    Liked by 2 people

  4. Get New! Or, You’re Through!!

    Liked by 1 person

  5. Barry Drake

    When Katherine Graham ran the Washington Post she united and rallied the staff with one question, “Are we providing an indispensable service?”

    Liked by 1 person

  6. The best radio still available in America is local. That keys into the local community and develops a bond with the local listeners. You can’t do that when the station “playbook” reads, “Don’t say good morning after 9 AM because the track may not playback in morning drive.”

    Liked by 1 person

  7. Ronald Roy

    In a world that is disconnecting from the “personal” touch for individual satisfaction, not radio or any other medium can or will become “necessary” . Radio lives today on the inheritance of it’s past. It may take years but every day it moves ever closer to the precipice of irrelevance. Choices will continue to grow and old habits will die with their owners. Look at print. They too are being absorbed into the internet abyss. There are SO many ways to get news today what could possibly “dominate” your attention? Who wants to pay to read the Washington Post when all this information can be found on Yahoo, Bing or your local TV station (and some radio stations) websites? It is a daunting future with a very cloudy view that can change hourly! The younger generation(s) will continue to adapt and evolve and create what is “necessary”. I don’t know what that is 10, 15 or 20 years from now but it’s hard to imagine it’s radio???
    We were talking about this 10 years ago and we will be talking about it in ten years from now. I have been in the business for nearly 40 years. It’s interesting the view one gets when your not in the trenches day to day. I love radio and am sad to watch it’s slow demise. Whether we want to admit it or not, the future is stormy at best and call me a pessimist but the reason we’re still talking about it is there is no “magic bullet” to be found that will resurrect or keep radio relevant. While I agree that very unique content can anchor listenership, how many Howard Sterns can there be?

    Liked by 1 person

  8. Rick Charles

    Having a heavy spot load is a problem more stations would like to have. Never heard of a station failing because it had a lot of ads, Dick. But, I know of several programmers who searched for the “Proper” spot load for 50 years and never found it.

    Like

    • Yes, those were the good old days, when the only audio competition was the other local radio station(s) in town. George Johns has explained that his stations in the Fairbanks group had excellent ratings and often ran spot loads that were higher than their competitors. But he explained that it was because EVERYTHING that went on the air had to pass through the PD’s filter. Geo explains that what made them successful was probably what they didn’t let get on their airwaves. That everything had to fit in with the flow of the radio station’s format.

      What I’m hearing on today’s radio are so many program elements that DO NOT fit with the flow of the station.

      And with the infinite number of streaming options available to the audio consumer today, they don’t need to let you know what’s wrong with your product, they just move on.

      Thank you Rick for weighing in with your thoughts, but I would respectfully disagree that any commercial radio station can play the game of yesterday, when it comes to spot loads, and win for very long.

      Even network television is announcing it is time for them to reduce the number of spots airing in their programs.

      -DT

      Like

  9. Rick Charles

    I appreciate the response, Dick. “Trim the # of ads and charge more.” Reminds me of the Old Clear Channel and “Less is more.” Don’t believe that he works at iHeart anymore.
    TV is again imitating radio with it’s belly-button examinations on spot-load. Like radio, they don’t wonder if the problem is poor programming (crappy music). Instead, ads are the problem.
    Dick, how would you like to work in a profession (radio sales) where the product you offer is regarded as a problem by top management? And, there is a limit on how much you can sell. And a finished version of the product needs to pass inspection by a programmer who has never sold advertising for a living? Maybe that’s why all the turnover in radio sales?

    There was such a demand for TV ads in the Super Bowl that the pre-game shows now run all day leading up to kick-off. It was no longer possible to get all the ads in the game itself. Radio needs problems like this.

    Like

    • Barry Drake

      Let me point out that the “less is more” craze from the old CC regime was exactly the opposite. It called for more units at roughly half the price.
      And the Super Bowl has limited supply–which is why the rates are so strong and have increased 87% over the past 10 years.

      Liked by 1 person

      • This is so true Barry. I was a market manager for CC at that time and when “Less Is More” was birthed the commercial clutter introduced into all formats was HUGE.

        Also true about Super Bowl inventory being limited. And advertisers spend big dollars on trying to create the most memorable ads. No such equivalent has ever been spent on making radio ads as memorable (though some very memorable radio ad campaigns have been created over the years).
        -DT

        Like

  10. Rick Charles

    It’s been about 4 weeks since the game and I can’t remember a single ad. Have you noticed that rarely do the national advertisers on the game continue running the ad during the rest of the year? It must’ve been so memorable that it only needed to run once.

    “Commercial clutter”..nothing like a discussion with subjective statements.
    Your “clutter” is another’s mosaic. These columns are always well populated by “former” radio people. The ones who sell big schedules and make big money are on the street at this hour-not expostulating. I have an excuse: I’m semi-out-to-pasture.

    Like

    • Ad-Supported Media Usage Reaches Lowest Level Ever Consumers continue to spend more time with media overall but the percentage of time they spend with ad-supported media continues to decline, according to a MediaPost report, citing data from media econometrics company PQ Media. The data finds that Americans spent 70.7 hours per week consuming media in 2017 and that was up from the year before. However, the bad news for the ad community is that the share of time spent with ad-supported media fell to 44.4%, the lowest point ever. The report by PQ Media also projects that ad-supported media’s share of consumer time will fall to 42.5% by 2021 as consumer shift more of their time and attention to media that has little or no advertising in it, i.e. subscription services for streaming video, audio and other forms of media.

      -0-

      To this news item, I would add, ad-supported media needs to balance it’s advertising with it’s information/entertainment content. When you lose that balance, you suffer the consequences.

      Advertising that speaks to the consumer, as Roy H. Williams preaches, will always be welcome.

      I always waited for Page Two in Paul Harvey’s News & Commentary. It’s why I own so many BOSE products today. (Paul Harvey called himself a salesman.)

      Advertising is an art form. Done correctly, it is very effective and not an audience tune-out.

      Eight years ago, I made the career change from being a broadcaster to a broadcast educator. This media mentorship blog became an extension of my college classes.

      Thank you for sharing your perspective Rick.
      -DT

      Like

    • Fox aims to significantly reduce ad loads by 2020.

      Fox has set a goal to reduce commercials to just 2 minutes per hour by 2020, per Fox Networks ad sales chief Joe Marchese. In discussing the target and the TV advertising industry, Chief Product Officer Ed Davis wrote, “Creating a sustainable model for ad-supported storytelling will require us all to move.”
      https://www.wsj.com/articles/fox-wants-to-reduce-ad-time-to-two-minutes-per-hour-by-2020-1520334000

      Like

  11. Bill Cain

    Listeners love ads. They love sitting through 12 minutes (18-20 in a row) of stale, unimaginative, un-creative, cliche-riddled copy, rife with hollow production and hard-sell yelling. What color is the sky? Yesterday, I listened to one of these prestigious stations from Philly. They talked :45 to :52, and returned to programming at :04, sweeping the 10am TOH with SPOTS! So i turned on a local station from Vineland, NJ. Yes the copy was weak and production was not Radio Ranch, But in 30 minutes, 2 spots (:90 sec) 3 songs, 3 spots (:30 +:30 + :30), 3 songs, 1 spot LIVE read, 2 songs, :60 seconds ABC Net News, 2 songs, 2 spots (:30 + :30), 2 songs…it was like WABC 77 in 1968…I knew there was light at the end of the tunnel. And for some reason, it flowed and didn’t sound cluttered.

    Liked by 1 person

  12. “Remember when spot loads were small, rates were high, profit margins were 30% to 50%+ and revenue growth was double digit. I do.”

    I don’t. But then I worked for Howard Green…

    Like

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