Tag Archives: Harvard Business Review

Why do people buy what they buy?

120If you’re in sales, this is probably the question that haunts you most: Why do people do the things they do?

Daniel Pink recently wrote a book “To Sell is Human” and in the book, he tells us, we are all in sales today. In fact, we may not even be aware that we are selling all the time. Daniel told the Harvard Business Review:

“I’m obviously selling books because that’s a part of my business. But if you go beyond that, I (also spent my) time trying to convince an editor to abandon a stupid idea for a story. I tried to get an airline gate agent to switch his seat. I’ve got kids. So, I’m trying to persuade my kids to do things. I have various people I do business with. And I’m trying to get them to see it my way, rather than their way, to go my direction, rather than their direction.”

“And when you actually tease it all out, I’m spending an enormous amount of time selling.”

We’re All in Sales

Looking at this from a broadcaster point of view, we too are all in sales, NOT just the people in the sales department.

Programmers are selling their ideas to management and if management gives them enough rope, they then have to sell those ideas to their air staff who then has to sell the concept to the listeners.

Events Change Our World in a Heartbeat

Sometimes events change the dynamics of what people want, need and do. The recent hurricanes have certainly had that effect on broadcasting.

In Houston, KTRH was ranked #11. 122Then Houston was hit by Hurricane Harvey and KTRH zoomed to #3, but soon after the impact of the storm began to fade and life in Houston began its long road back to “normal,” KTRH sank back to #15.

I ran a news-talk-information AM radio station back in the 90s in Atlantic City and in spite of our big commitment to local news and information, research showed that people would rather spend their day with one of the many FM music stations. However, they knew in times of coastal storms or other emergencies, our AM radio station was the one to turn to.

Radio cannot live waiting for the next emergency.

iPhones vs Androids

We all know that iPhones have not activated the FM chip to receive OTA FM radio broadcasts in their older iPhones. Plus Apple’s newest iPhones (7, 8 & X) don’t even have an FM chip in them to activate. So, if having an FM chip in their smartphone was important to Apple’s customers, why do people keeping buying iPhones? Maybe it is because they use them for other things.

In the USA Google’s Android and Apple’s iOS mobile operating systems are sharing the market about evenly says John Koetsier writing in Forbes. However what we’ve seen over the last couple of years is that what they don’t share equally is commerce. iOS is used to make more online purchases than Android. If you’re selling stuff, that’s an important distinction and its why Apps are usually first developed for the Apple Store and then later for Android devices.

Digital Cameras

I recently read an article that said if digital cameras were to stay relevant, they should connect to the internet. Guess what, they now can. Here are seven of the best WiFi cameras on the market according to Lifewire.

Should they also be able to make & receive calls, texts? Contain an FM chip?

As everything becomes connected to the internet should they also be able to receive OTA broadcast?

Electric Cars

BMW was the first car company I was aware of, that when it introduced its all electric car said it would not contain an AM radio. BMW said they couldn’t isolate the noise interference it would cause to the AM signals.

Funny, but I remember when cars used to have only an AM radio and that isolating an alternator was often necessary to not get horrific noise through the speakers. Is this really that much of a problem or has BMW carefully defined its customer’s wants, needs and desires?

Tesla in introducing their new Model 3 also said AM radio would not be part of the center stack options.

Do you think this will give people pause in buying an electric vehicle?

Go with the Flow

None of these things really represent a change in why people do the things they do. Roy H. Williams, the Wizard of Ads, has been writing about these things for decades.

In his book “Secret Formulas of the Wizard of Ads” in Chapter 70 “Better Jewelry, Better Jeweler,” Roy poses this question: “If you had to choose between selling what you wanted to sell, or what the majority of people wanted to buy, which would you choose?” Your future success is determined largely by your answer to that very question says Roy.

Bringing this back to broadcasting, AM, FM, digital, TV, cable, streaming is really nothing more than a display case in a jewelry store. It’s what you put into that display case that matters.

Your success comes down to serving your viewer or listener in the very way they want to be served.

If you’re in sync with the people of your broadcast property’s service area, then you will enjoy their business and they will demand you be easily accessible on the latest device.

The curve ball today is connecting your programming to the internet. The internet is a global community. You can’t be all things to all people. If you try, you will fail.

Define your market, know what they want, then serve it up to them. It’s OK to put it on the internet as long as you stay true to the people’s wants and needs that you aim to serve.

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Radios Go High-Definition

37That was the headline that appeared in the Baltimore Sun on January 7, 2004. Unfortunately, unlike HDTV (High Definition Television) HDRadio never stood for “High Definition” radio. And maybe that was the first mistake. HDRadio was simply a name they chose for the digital radio technology.

The iPod was introduced in October 2001. Steve Jobs introduced this music delivery changing device this way. Only a month earlier, XM began broadcasting the first satellite radio programming to be followed four months later by Sirius satellite radio. So by 2004, digital radio was already late to the party.

KZIA-FM Z102.9 saw Kenwood USA sell its first digital receiver in Cedar Rapids, Iowa to take advantage of KZIA-FM’s HDRadio broadcasts. “This is a significant move,” Michelle Abraham, senior analyst at In-Sat/MDR, a market research firm in Arizona, said of the roll-out of digital radio equipment. “It may not seem duly significant in the beginning, but in a few years from now, it will be a huge leap.” The hope was it would prove to be competitive to the newly launched satellite radio offerings from XM and Sirius (now merged into a single satellite company). HDRadio was also seen as improving FM to have CD quality sound and making AM sound like FM. It was heralded to help struggling AM radio stations.

Solving a Problem That Didn’t Exist

What HDRadio did for FM radio stations was solve a problem that listeners to FM didn’t feel existed. No one who listened to FM radio was complaining about the quality of the sound of the transmission. (They were complaining about other things, like too many commercials.) And for AM radio stations, it meant people buying radios for a service that didn’t offer anything they really wanted to hear or couldn’t get from someplace else. AM radio was now the service of senior citizens who already owned AM radios, who grew up with AM radio’s characteristics and whose hearing was not the best now anyway. So HDRadio for AM wasn’t something they were asking for either. Worse, AM radio stations that put on the new digital signal found it lacked the benefits of skywave and often interfered with other company AM radio stations as the industry quickly consolidated radio ownership.

Industries Most Disrupted By Digital

In March 2016, an article published by Rhys Grossman in the Harvard Business Review listed “Media” as the most disrupted by the growing digital economy. Turns out if you’re a business to consumer business, you’re the first being most disrupted by digital. The barriers to be a media company used to be huge, but in a digital world they are not. The business model that media companies depend on has not adapted well to the digital economy.

Education – Disruption Ahead

Having moved from media to education I only got ahead of digital’s disruption for a while. But even those industries that had perceived high barriers of entry are finding those walls crumbling quickly. Grossman says fifty percent of executives see education being impacted in a big way in the next twelve months.

Where Are The Radios?

Edison Research did their latest “Infinite Dial” webinar and the slide that most impacted me was the one about radio ownership. From 2008 to 2016 the percentage of people in America that don’t own a single radio in their home has gone from 4% to 21%. When Edison narrowed this down to household between the ages of 18-34, non-radio ownership rose to 32%. Mark Ramsey’s Hivio 2016 Conference had one Millennial describe a radio set as being “ancient technology.” Ouch!

It doesn’t seem all that long ago that Jerry Lee’s WEAZ in Philadelphia was giving away high quality FM radios to increase listenership to not just his radio station but to FM radio. And KZIA in Cedar Rapids gave away HDRadios to allow people to hear their new signal. It now appears time for the radio industry to begin giving away AM/FM radios every time they are doing station remotes, contests or appearing at venues that will attract lots of people.

Elephant in the Room

But the elephant in the room remains the broken media business model. Newspapers, magazines, radio, and television – any media that is ad supported – will be challenged to find a way to capture revenue to continue.

As Walt Disney famously said “We don’t make movies to make money, we make money to make movies.”

To anyone in ad supported media, we would agree we do it for the same reasons.

The $64,000 question is how.

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