Category Archives: Sales

March 22, 2015 · 8:10 am

It’s too soon…

DT WBEC (1970s)I knew from the time I was a little boy, I wanted to be on the radio. I built a radio station in my parent’s basement and broadcast to my neighborhood using AM & FM transmitters I bought at Radio Shack. Besides being on the radio, the other thing I wanted to do was drive a car.

I was fortunate that my opportunity to be on the radio happened in the 10th grade in high school and when my moment came, my only thought was “it’s too soon,” I need more practice, I’m not ready yet.

When I learned to drive a car and that day came when it was time for me to drive away by myself, I thought, “it’s too soon.” When I made the transition from radio disc jockey into radio sales and the day came for me to go out on my own and begin calling on businesses to sell radio advertising, that day came WAY too soon.

I was successful in radio sales and they made me sales manager. Too soon I thought, but sales manager led to station manager and then general manager of the AM side of an AM/FM combo. The general manager of the FM side of the operation was also part-owner so I always thought of myself as the “baby gm.” Then the day came when the majority owner of my radio station offered me the position of general manager in Atlantic City at another pair of radio stations he owned. Now I would have to make it on my own. No more baby gm, I would be the only gm. Too soon!

After 42-years in radio, thirty of which were as a market manager, I made a career change into higher education by becoming a professor at a university. I spent the summer preparing and planning every lesson in every class I would teach that fall. When the first day of classes arrived, my only thought was – you guessed it – too soon.

What’s interesting about everything I’ve share with you up to this point in time is that nothing was really life threatening. Even getting married and having our first child (too soon times two) was not life threatening. Having the second child – seemed too soon since we were just getting good a taking care of one baby – wasn’t life threatening.

Then I took flying lessons.

I found I was really enjoying my flying lessons. Those weekend lessons over South Jersey, along the beaches in the summertime were exhilarating. I was making great progress. Keeping the nose up, learning to trim the aircraft, scan the horizon for other planes in my proximity and learning how to land in the strong cross winds that came in off the ocean at 90-degrees to the only runway at Ocean City, New Jersey’s airport.

And then it happened. I had just landed the plane when my flight instructor hopped out and said, take her around again and slammed the door. Gulp!

I powered up the engine to full throttle and picked up airspeed down the runway and took off all by myself. All the while thinking, it’s too soon. I hope I can do this.

I’ve always heard that a student pilot’s best landing is their first one after their first solo flight. That was certainly the way it was for me. That single engine Piper landed ever so softly onto the tarmac and I taxied to the terminal building in a moment I will always remember. (The moments that I would almost not live to tell about would come much later in my brief flying career.)

The point of my story is that everything that happens to us, which will help us to take the next step forward in our careers, our business, our education and our life always seems to come too soon.

We will never really feel as prepared as we think we should be. Do it anyway.

Seth Godin puts it this way:

“There is a fundamental difference between being ready and being prepared.

You are more prepared than you realize. You probably aren’t ready, and you can’t be ready, not if you’re doing something worthwhile.

Because we always do our best work and take our turn before we’re ready.”

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March 15, 2015 · 10:41 am

The Future of Ad Supported Media

I’ve just finished reading Thomas Piketty’s book “Capital in the Twenty-First Century,” which I highly recommend everyone read, and Piketty stops me cold on page 357 with this graph (see below). I’ve highlighted in yellow two things for you to take note of. In a moment I’ll explain why this hit me so hard.

This same week, I was reading Seth Godin’s blog post “Mass production and mass media” where he explains that mass media exists because it permits mass marketers to do their job and how mass media is going away. If you’re in radio or TV, that kind of proclamation will get your attention; BIGTIME.

Godin is predicting that the “mass” part is what’s going away and that it is being replaced by “micro.” In essence that it’s better to be important to a few than be irrelevant to the many.

Then this article appears in AllAccess “Radio’s Dying…But The Cause Isn’t What You Think.” Seth Resler writes that radio isn’t going to die because it has been abandoned by listeners, but it’s going to die because it’s been abandoned by advertisers. Resler goes on to make the case that advertising is moving away from the Mad Men era art form that it was, towards a keyword and search scientific algorithm metric of today.

“…there has been little doubt for more than a decade that the advertising model that traditionally supported an industrial-age news and information system is evaporating,” writes Anderson, Bell and Shirky on pages 11-15 in “Post-Industrial Journalism: Adapting to the Present (2012)”

Mark Perry, blogging at the American Enterprise Institute writes: “The dramatic decline in newspaper ad revenues since 2000 has to be one of the most significant and profound Schumpeterian gales of creative destruction in the last decade, maybe in a generation.”

Well, I’m here to have you consider a 3rd possibility, one that stopped me in my tracks as I was reading Piketty’s book. Now, I may be putting words in Professor Piketty’s mouth when I tell you what I’m about to say. Piketty did not write about radio or TV, or mass media in general in his book. He writes about wealth inequality in our world from antiquity to the present day and then makes some predictions about where things are headed based on current trend lines.

But this graph on page 357 haunts me.

Picketty Chart on page 357

That graph, from the period of 1913 to 2012 includes the period in which radio and television were born. It’s the era when advertising supported media took off. I worked the last forty years of that graph in the radio business and experienced the change in business that this graph shows.

Commercial radio was born in 1920. Commercial TV took-off in the 1950s. And I quite agree with Seth Godin when he writes “Mass production, the ability to make things cheaply, in volume, demanded that we invent mass marketing – it was the only way to sell what was being made in the quantity it was produced. Mass media exists because it permits mass marketers to do their job.” To which I would add to Seth’s thoughts that mass media and mass marketing both existed because there was a strong American middle class of consumers.

If Piketty is correct, the concept of a middle class consumer economy that existed between 1913 and 2012, was an anomaly. It didn’t really exist anywhere in the world before 1913 and it’s very likely not going to exist anywhere in the world as we journey away from the year 2012. The middle class consumer economy will evaporate and along with it, advertiser support for mass media.

1913-2012 was a unique period in world economic history. It gave birth to consumers who had money to spend, mass production that could produce lots of goods and mass media that could advertise those goods. All three were simultaneously occurring at the very same moment.

The new buzz words are “shared economy” and “collaborative economy.” What roles will large corporations, universities and mass media play when people are getting what they need from one another?

In 2014, Nielsen Music reported a staggering drop in music sales where as much as a fifth of music buyers didn’t buy anything.   2014 also saw box office ticket sales plunge to their lowest level in three years. The home ownership rate reached its lowest point in 25 years at the end of 2014. More people were now living in shared living arrangements or going back home to live with mom and dad. And NYC Mayor Bill de Blasio appearing on “The Nightly Show with Larry Wilmore” told viewers that:

“The wealth gap in New York City today is worse than during the Great Depression or The Roaring 20s – and the gap is growing bigger. Today over half the people in NYC pay over a third of their income for housing. The reality is, (according to the mayor) if we don’t change course middle class families won’t exist in New York City.”

Are these reports canaries in the consumer coal shaft?

Medialife Magazine, a magazine devoted to media buyers and planners, reported that 2014 wasn’t good for advertising. Total spending was up 3.0 percent, but if you take out political spending and the Winter Olympics, the number shrinks to 1.6 percent. “That’s the worst yearly growth pace since the recession began in 2008,” said writer Bill Cromwell. Traditional media is struggling and according to Magna Global, “this appears to be a lasting trend.”

Only recently have broadcast operators said things like “flat is the new up” when comparing year-over-year revenues. I realize there are exceptions to what I’m saying. Your broadcast property might be one of them. But what are the trends that are taking place and how will they impact you in the years to come?

It took two world wars to re-set the wealth inequality gap and put into place FDR’s New Deal. Changes that have in more recent times been stripped away returning things to the way they were in the 19th Century; a period of time when the concept of a middle class of consumers didn’t exist.

Roy H. Williams, aka The Wizard of Ads wrote recently (Monday Morning Memo, March 2, 2015) about “the shrinking of mass media” and “the growing reality of gender equality.” America went from being 16% single to 46% single in just one generation, Williams writes. “A once-proud nation of families is evolving into a proud nation of individuals.” And Williams sees “The trend toward singleness is sociological (while) the erosion of mass media is technological (as) each trend accelerates the other.”

Williams comes to this conclusion:

“We’re approaching the end of a golden time when courageous advertisers can invest money in mass media and see their businesses grow as a result. My suspicion is that we’ve got perhaps 5 to 7 more years before retail businesses and service businesses will be forced to begin playing by a whole new set of rules. Buy mass media while the masses can still be reached.”

The future of ad supported media is tied to consumerism. Consumerism is tied to having a strong middle class.

Does the Piketty graph on page 357 of his book “Capital” send a chill down your spine like it does to mine?

P.S. Thomas Piketty published an amplification on his r>g theory. You can read that here.

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February 22, 2015 · 9:57 am

Top 3 In-Demand Radio Jobs

What is the future for jobs in radio in our digitally connected world? Three jobs in particular stand out as being in demand right now and look to be still in demand as radio celebrates its 100th Anniversary in the year 2020. The first won’t surprise anyone, the second is a job that only recently became critical and the third is a job that’s been a part of radio since day one.

#1 Radio Sales People

I’m sure it comes as no surprise that the need for trained, professional sales people is the number one radio job in demand today and as far out as the eye can see. Since I’ve been in radio it seems hiring good sales people was always on the lips of general managers and sales managers. So when we asked the operator’s of Kentucky’s 300 radio stations what were the jobs they most needed to fill, sales was job one.

Ironically, it’s the class not offered by many of America’s colleges and universities that offer a broadcast curriculum. Where I teach at Western Kentucky University, Bart White started teaching radio sales decades ago as part of the broadcast degree program in Radio/TV Operations. In fact, Barton C. White wrote two books on radio sales, his second called The New Ad Media Reality Electronic Over Print should have been widely distributed from the day it came out in 1993. I know I wished I had been aware of it back then.

I was hired to replace the retiring Professor White and immediately charged with teaching both the Broadcast Radio/TV/Digital Sales class as well as the Radio/TV Operations Capstone class. Since I began five years ago as a tenure track professor at WKU, I’ve overseen the creation of the KBA WKU RADIO TALENT INSTITUTE that contains a strong sales component as well as adding a second sales class to the broadcast curriculum in Advanced Radio Sales that enables students earn their professional Radio Advertising Sales certifications in both radio and digital sales from the Radio Advertising Bureau (RAB).

My students have learned that with this type of training, they are almost guaranteed a job upon graduation wherever they decide to live. I’ve successfully placed students with companies like iHeartMedia, CBS Radio, E. W. Scripps, Cromwell Broadcasting, Alpha Media, Commonwealth Broadcasting, Viacom, Summit Media, and Forever Communications.

This year at BEA2015 (Broadcast Education Association) in Las Vegas I’m moderating a panel I proposed to encourage other colleges and universities to consider adding radio sales classes to their curriculum by letting them hear directly about the need in this area from some of the radio industry’s leaders who will be in Vegas attending the NAB April Convention.

#2 Internet Content Creator

The next position that is in demand is for people who can create original content for radio station websites. Not cut and paste artists who “borrow” others’ website content and re-purpose it but innovators that can act like a combination of journalist/advertising/public relations specialist and populate radio station websites with engaging, compelling original content that is of interest to people in the station’s service area.

#3 RF Broadcast Engineers

Not that it was ever easy to hire great radio engineers, the talent pool used to be a whole lot bigger. Consolidation chased a lot of them out of the business and what they learned was the job could be more lucrative by becoming a consultant engineer to groups of radio stations. Other engineers found new opportunities in other industries that could apply their talent and strong work ethic that was instilled into them by radio’s 24/7 on-call employment. Computers and digital technology also demanded that radio engineering learn this new radio operational system or get out.

Well, those who went into private consulting are now reaching the age of retirement. Those who went into other industries learned the pay and hours were often better than radio. Further complicating things, most schools are teaching the skills needed for the digital world and radio stations still generate broadcast signals using radio frequency (RF) and there are fewer schools turning out these types of engineers for radio stations. Graduates are sought by the wireless communications companies that have similar needs to radio stations and have the deep pockets to entice them to work for them.

Positions Not In-Demand

General Managers, Promotions Directors and News Reporters are found on the bottom of the employee needs list. It would appear this is a result of radio’s consolidation. One manager is now needed to oversee a cluster(s) of radio stations. Promotions are now planned on a group-wide basis and news hubs have been set-up to serve regional areas.

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January 11, 2015 · 11:43 am

Combined or Separate?

When I started in radio sales, the company I went to work for after leaving programming and operations ran an AM/FM combo that simulcast all of their programming. Selling for these two stations meant every spot sold was heard on both broadcast bands. (Piece of cake)

Then one day, the owner announced the signals were being split apart. The AM station would program an entirely different format from the FM station, but the sales team would be selling both separately programmed radio stations. (A two layer cake)

Anyone who has some history in the radio business will tell you the answer to the age old question of whether it’s better to field two separate sales teams for an AM/FM combo versus having one sales team. In fact they will give you a definitive answer: “it depends.” (Did someone leave my cake out in the rain?)

Before the radio industry could wrap their brain around this puzzle regarding sales staffing, along comes the Telcom Act of 1996 and companies now own clusters of radio stations. It was now possible for a cluster to number 5 or more radio stations serving a metro. (My cake is melting, melting. Did I mention I never really understood the lyrics to MacArthur Park?)

One brave company in Florida announced they were going with the single sales force concept for their nine station cluster. That got my attention as I was now in management. Well you can imagine I wanted to catch up with these folks at the next RAB Managing Sales Conference to find out how it was going. I did. I asked. The answer they gave me? “Oh well.” “Oh well?” I asked puzzled. They then explained it was very difficult to find radio sales person who could manage selling multiple formats (music, talk, sports, etc). They maybe had one person on their rather large sales team that could do it. A couple could handle maybe 50% of the cluster at the same time, but the rest maybe two radio stations in the cluster at most. The result was they abandoned the idea of one sales team selling everything.

Closer to home, I launched a print program at a cluster I was managing that had an AM station, an FM station and an LMA’d FM station. We had separate a separate sales team selling the LMA’d FM station and a combo sales team selling the owned AM/FM stations. It was decided that all sales people would now sell the new print program. I should explain the print program was actually two components. It was a quarterly coupon book distributed in five different mailing zones in the metro and then there was a calendar that was sold in all the mailing zones on an annual basis.

So, my sales force was now responsible for selling radio spots (and promotions) where you saw the advertiser today and he started in the next couple of days. A print coupon book where you saw the advertiser today and the ad would come out in the next quarter. And an ad in a calendar you sold today and it came out next year.

So how did that work out? Fabulously, actually. Till it didn’t.

What we would learn is it was a good way to launch and put immediate new revenue on the books. Over time the print program re-trained our radio sellers; which was an unintended consequence. They soon learned when an advertiser said they didn’t want radio ads; they had found themselves a print customer.

After an ownership change, I made the decision to break away our print program into a separate entity with its own management and sales people.

So it was no surprise when Borrell Research came out with their latest research study this week “2015 UPDATE: Assessing Local Digital Sales Forces” and it said that those companies that had sales people who were digitally focused produced more digital revenue than those that had one sales team selling everything. You can find the full report clicking on the hyper-link.

Quoting from Borrell’s Executive Summary: “The result is stark: Those with digital-only sellers report far greater confidence in their staff’s ability to understand market trends and clients’ digital needs, and they generate four times as much digital revenue. For instance, two different newspapers, each with a total of 22 sales reps, reported $7 million in digital sales last year and $360,000 in digital sales. The difference? One had seven digital-only reps; the other had none.

But before you get the idea that I’m taking the position separate is best, it really depends…..depends on the skill level of your sales people and their embracing of new technology and new ideas.

When I was starting out in radio sales I got to see and hear a lot of great sales trainers. One that I really liked was Don Beverage. Don would categorize sellers in one of four ways. They were “Commercial Visitors,” “Product-Oriented Peddlers,” “Problem Solvers,” or “Sustaining Resources.” See the snake in the wood pile when it comes to answering the question “Combined or Separate?”

If your sales team is made up of first three types of sellers, separate your sales force. If they are level four sales people, “Sustaining Resources” then you might win with a combined force.   But here’s one more twist. The very best sellers will be “Problem Solvers” with some of their clients and “Sustaining Resources” with others. Even Don Beverage was quick to point out that reaching the level of “Sustaining Resource” was being in rarified air.

So you know a “Sustaining Resource” level of selling is when the client believes in you so much that they pick up the phone and call you in BEFORE they take the first step in the advertising/marketing program. YOU are part of the team that will create and design the strategy and then plan out the tactical steps to get to the finish line and win.

So there you have it. Put on MacArthur Park by Richard Harris and spend the 7-minutes, 25-seconds and ponder what’s best for your operation.

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January 4, 2015 · 6:22 am

Entertainment for nothing….

When radio was born, no one had a clue how to make money with it. The early radio station operators made radio sets. They knew if they wanted to sell radio sets, they had to provide something for those radio sets to pickup and for the people who owned those radio sets, something entertaining to listen to.

It was AT&T, that didn’t make radio sets, that was the first radio operator to try selling the first radio commercial over their radio station WEAF. AT&T was in the phone business and the selling of phone lines to carry network radio programming. It put on-the-air a radio station merely to understand the business better. Not wishing for it to be an expense, they went looking for a way to make their radio station pay for itself, if not make a profit.

Many ways of making money with radio stations were tried, but by the late 1920s, the selling of advertising reached the tipping point for this business model going forward. Radio had conditioned people to expect, that if they bought a piece of hardware – a radio set – the content would be provided for free; albeit supported by advertising.

When the Internet came along, people expected to buy the hardware – a computer, modem and connection to the World Wide Web – but they expected that the content would be free, and it was; again supported by advertising.

Newspapers and magazines grew up with no hardware to buy, just the content that was printed on paper. The subscription cost was relatively low and advertising would pick up the rest of the expense along with providing the owners a nice profit.

The problem today is newspapers and magazines have joined radio and television in the new distribution channel of the Net. Two of these mediums should be adept at marketing their content in this manner and the other two, well, are finding it challenging.

Cable TV’s HBOs and SHOs, on the other hand, charged for their content from the get-go. And when Netflix came along, it also created the pay-for-content habit which it easily converted from the mail to the Net. They also provided their content commercial free. This created an expectation that when you pay for content, you don’t have to have your content interrupted by ads.

The pay walls that have been tried by newspapers and magazines include advertising, but that’s only part of the problem. You see the print consumer was never really paying for the entire cost of printing and distribution. They merely made a contribution to that cost. The rest of the cost was picked up by the publisher, who gladly subsidized the whole thing because of the tremendous profits they realized via the sale of advertising. The other is a case of supply vs. demand. The supply of content has never been greater and the demand, so fragmented. This post is just one example of the free content anyone can get off of LinkedIn with a free account or via my blog (DickTaylorBlog.com).

The bucket of cold water reality is that marketers are more willing to pay to reach consumers with their message than consumers are willing to pay for content they want to consume.

So why are radio and television spinning their wheels while others (BuzzFeed, Vice Media, etc.) are walking away with the mother lode? To paraphrase the famous line from the movie “Cool Hand Luke”: What we have here is a failure to innovate.

Radio and TV merely want to put their content on the Net and count the money. To compare it to sports, these two legacy mediums are good at baseball (over-the-air) and now when they move to the Net, where the game is football, they want to continue playing baseball.

In radio, FM finally came into its own when young broadcasters were given the chance to innovate. We are living during a communications revolution. Revolutions are periods of huge disruption to what was, as what will be gets created. The new opportunities are being seized by those not clinging to their old business models. The bad news is the “good old days” aren’t coming back. The good news is, what will replace them will be just as good, if not better.

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