Tag Archives: Future

Choices Radio & Colleges Should Be Making Right Now

Every day the radio business and the business of higher education are faced with lots of choices that will affect them in the years ahead. Here are my thoughts about some of the choices they should be making right now.

Do what only you do best.

 Before the era of instant communication and search engines, both radio and colleges provided many services that people couldn’t get anywhere else. If you wanted to know if the snow storm cancelled school, you turned on the radio. If you wanted to earn a college degree, you attended college.

Today, schools will text message the status of school opening to teachers, students and staff the moment a decision has been made following a big storm. Radio is no longer necessary to fulfill this message delivery task. Likewise, anyone who wants to learn about anything – including earning a diploma in that discipline – can do it online. You don’t need to go any further than your computer.

Radio needs to take a hard look at everything it does that was important to their listeners and eliminate all of the things that the listener today gets faster and easier from someplace else. Colleges likewise need to re-think their mission and focus on those things that it does best and that only they can offer.

Thinking you can stop a changing world.

 People have been warning the radio industry for years at annual conferences that the Internet was going to change things for them BIG TIME. I know, I attended most of those meetings regionally and nationally over many years. But radio continued to do what it had always done and thought that the changing world would stop at their door. Higher education pretty much is doing the same thing. Both are highly computerized, but only to do what they’ve always done a little faster than before.

Think of the possibilities.

 The Internet provides every business the opportunity to do things that were not possible before there was an Internet. Did established businesses like radio or colleges seize this new opportunity? No. Google, Amazon, eBay, Facebook, Twitter, LinkedIn etc did.

But it gets worse. Pandora used the capabilities of the Internet to build a streaming juggernaut. Listeners can build their own “radio stations” and skip songs that they don’t like.   University of Phoenix grew to 600,000 students* in over 100 degree programs. A website I visited listing the top online colleges framed the issue of an online education this way:

“It’s up to you to decide whether you want to attend a large, recognized online university or a smaller, less known college. As long as your program is accredited by an authorized agency, you can receive an education online that is as valuable as your campus experiences.”

The radio industry could have created Pandora. Higher education could have created University of Phoenix. Heck, Kodak could have created the digital camera – oh wait, they did, but didn’t pursue it because they were invested in making and selling print film.

History is a great teacher.

 When TV came along in the 1950s, it stole radio’s programming and people. All those must hear radio shows in the evening prime time hours moved to television. The family that gathered around the radio in the living room now sent the radio packing to another location in the home and TV took its place. Radio operators quickly began developing programming that only radio could do. They found a niche and filled it.

Colleges did this too. Many began as normal schools and grew to teachers colleges. As the needs of the nation changed, colleges grew to universities.

What makes today’s world different is the changes both radio and colleges made might be called evolutionary. Today’s world has brought on a revolution in communication and learning.

Make mistakes.

 The pressure to not make mistakes is daunting. The big radio companies have large debts to service. Public colleges and universities are more privately funded by tuitions, alumni, endowments, grants etc than they are public tax dollars. In order to play it safe institutions try to avoid risks. Avoiding risks means keeping things status quo.

Nothing stays the same. Things are either getting better or getting worse.

There’s no time to waste.

 Both radio and colleges need to be creating incubator programs that are allowed to make mistakes and fail. Thomas Edison put his research activities on finding the right filament to power his light bulb this way: “I have not failed, not once.  I’ve discovered ten thousand ways that don’t work.”

If there’s one lesson history has taught us it’s that if existing industries don’t create the future, somebody else will.

*University of Phoenix’s numbers have declined almost 60 percent since 2010. The enrollment drop has been attributed to operational changes amid criticism of high debt loads and low job prospects for university students according to published reports.

4 Comments

Filed under Education, Mentor, Radio

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.

2 Comments

Filed under Radio, Sales

What Radio Could Learn from Vladimir Putin’s Dilemma

History never really repeats itself, but it often does rhyme with the past.

For the radio industry, today’s Internet is a challenge not unlike what the industry faced when TV began to take off in the 1950s. For Putin, the plummeting price of a barrel of oil is reminiscent of what happened in 1985 when the Saudis stopped protecting oil prices and focused instead on share of market. Then, as now, the Saudis decision is putting Russia in a corner.

Russia is dependent on oil and gas. The radio industry is dependent on the sale of radio commercials.

52% of Russia’s revenues and over 70% of its exports are oil and gas. 78% of radio’s revenues come from the sale of radio commercials.

See the similarity?

Gordon Borrell will be holding his 2015 Local Online Advertising Conference in New York City this coming March (https://www.borrellassociates.com/loac2015/) and the key note speaker will be investment banker Jim Dolan. In a comment promoting this conference, Dolan has been quoted as saying that valuations for companies with a strong digital presence will be much higher than for any company relying on legacy platforms for 50% of more of their income. (http://rbr.com/boring-in-on-digital/)

For Putin, 25 years after the last time the Saudis turned wide open their oil spigots the lessons not learned from past history have put this leader into corner. Radio has the lessons learned from the birth of TV.

Again quoting Dolan, “I think the smartest thing that legacy media managers can do is plow all of their free cash flow into digital products and services….it’s too late to knit a digital parachute when you’re falling off the cliff.”

Leave a comment

Filed under Radio

Winners Invest in the Future

America got to be the leading country in the world by investing in its future and much of that investment came from the government investing in the new ideas of its citizens.

In 1825, an American painter was commissioned by the City of New York to paint a portrait of Lafayette.   The painter traveled from his home in New Haven, Connecticut to Washington, DC to paint Lafayette before he departed back to France. While in DC, the painter received word his wife was very sick. Before he could even begin to travel back to New Haven, a second letter arrived to say his wife had passed away. Grief stricken, this event would cause the middle aged painter to search for a faster means of communication.

Samuel Finley Breese Morse would, with the financial assistance of the United States government, build the first telegraph system between Washington, DC and Baltimore, Maryland in 1844. He would secure his patent for the telegraph in 1847 and be given the rights to privately build telegraph systems throughout America and the world. He co-founded the Morse code language that bears his name and is still the code used today by practitioners of this form of communication.

This kind of investment in the future has been the Hallmark of America.

Radio has benefited from many creative geniuses over the years since its commercial birth in 1920. Programmers, air talent, engineers, managers and visionary stakeholders have all played a role in making radio the second greatest invention of all time (according to the History Channel).

Growth of any enterprise only occurs if there’s a steady stream of new innovation. Innovation occurs when experimental research is conducted without thought for where it may lead. The transistor was invented in 1947, but it didn’t really see a practical application until the first transistor radio was put on sale in November 1954. It was the Regency TR-1.

The transistor radio and car radio would be the salvation of AM radio with the advent of commercial VHF TV in the 1950s. The inventors of the transistor did not envision that their creation would save the radio industry by making it available to a whole new generation who wanted to hear the latest music wherever they went.

Ironically, our government funded virtually every piece of technological development that would make possible the Internet, the iPhone and even Siri. Radio can either be like Google and Apple and take advantage of what’s been created to leverage it for their business or relegate their medium to the era of flip cameras, walkman, dial telephones etc.

Radio today invests a lot of energy in trying to hang on to the past. It’s playing defense instead of offense as it did back when television was born.

To win in the future, you have to invest in it.

Leave a comment

Filed under Radio