Switching from a ten-year run as an air personality and operations manager, America was headed towards a brief recession, when I began in radio sales in 1979.
During that year, inflation had climbed to an unbelievable 11.3%, but 1980 saw it continue to grow to 13.5%. The prime interest rate, considered an important economic measure, climbed to 21.5% in June 1982.
They say timing is everything, and beginning a radio sales career during these challenging times turned out to be a blessing. Orders were not flying in over the transom. but if you wanted advertising business, you had to do your homework, develop creative advertising programs for your clients and burn lots of shoe leather to get the orders.
The Great Recession of 2008
I wasn’t afraid of facing the Great Recession of 2008, as I had learned that during difficult economic times, radio was the effective and very affordable means of advertising that got solid results for local businesses. Plus, during the economic downturn in 1989-90, my radio station cluster in Atlantic City turned in its first million dollar bottom line performance.
While the business environment was very challenging, and not all segments of society were doing well, there were people who were still employed, making money and wanted to increase their possessions, go places and try to live a normal life and radio was what reached them most effectively and efficiently.
COVID-19 Pandemic
Fast forward to 2020 and the global pandemic.
Maybe the closest comparison to what’s happening right now is the planet’s two World Wars.
Not in my lifetime, can I ever remember a time when just about everything was closing down, postponing or cancelling their events all across the globe.
The list continues to grow and the depth and breadth of it boggles the mind.
We are truly in uncharted waters.
Social Distancing
The new buzzwords are “social distancing.” Church services, if they are even allowed to be held, are telling parishioners not to shake hands but rather to nod their heads or make the peace sign during the service and avoid all human contact.
Everyone now is being told to stay home and avoid all contact with other people.
Every time I open my computer inbox, another company is sending me an email detailing how they’re dealing with the pandemic and advising me to stay home.
My city in Virginia added a new page on COVID-19 to their website and sends out emails and text messages updating the situation in both our city and state.
This new form of communication from local schools, governments and businesses, eclipses broadcast media for staying abreast of the situation on a moment by moment basis.
Economic Impact
While economists were already predicting a recession in our future the percentages of that occurring this year were relatively low, until COVID-19. Bloomberg now says with the bear market’s arrival last week, the chances of a recession in America this year have increased to 80%.
When the weatherman says there’s an 80% chance of rain, I grab my umbrella when I leave the house, so I take this change in the economic forecast very seriously.
Bloomberg says only twice has the stock market plunged 20% and not had a recession follow.
Truly, the United States is facing a potential “Black Swan Event.” Black Swan Events are occurrences that are extremely rare and unpredictable which spawn potentially severe consequences. Is radio ready for a “Black Swan Event”?
Fasten Your Seatbelts – Turbulence Ahead
People who are sequestered in their homes, will most likely be consuming media that they stream.
Most radio listening these days occurs in the automobile, but if people are staying home, they are not in their cars and listening to their car radio, and one third of American homes no longer have a single radio receiver in them.
I expect we will see an increase in people binge watching programs on their streaming video services, as well as buying groceries and other items they need online, to be delivered to their home.
To create a new habit, it takes three weeks to become routine, and the lockdown currently underway appears it will last from three to five weeks. Is that enough time for a major change in media habits to occur?
After the Crisis Ends
In terms of deaths and economic impact, the COVID-19 Pandemic has been described as a “major crisis” and could be on scale with that of a world war.
When it ends, will we see pent-up demand for goods, services and experiences, like occurred after WWII ended? Or will we see people reassessing their lives and what’s really important to them, moving people away from a consumer driven society to a more planet/people sustaining one?
What will radio’s role be then?
It’s not too early to begin forming a strategy to deal with the aftermath of COVID-19.
The current pandemic is not a sporting event. We are either all winners or we are all losers. Unlike anything in our lifetime, we are all in this together, at the same time, on every continent.
DickTaylorBlog 