Tag Archives: Less is More

You Can’t Have Too Much Fun

77There are some things in life you can’t have too much of.

You can’t have too much fun.

You can’t have too much wisdom.

You can’t have too much love.

Too Many College Bowl Games

My university invested a ton of money to upgrade to Conference USA. We won our bowl game in Florida this year too. Did you watch our team win? Probably not. Turns out attendance at the plethora of Florida college bowl games is down.

“When the Outback Bowl in Tampa announced an attendance of 51,119 on Monday who watched Florida dismantle Iowa 30-3, it became the sixth college bowl game among eight in Florida to have a decline in attendance from the previous year,” reports the Florida Times-Union.

NFL TV Viewership Decline

Rolling Stone magazine wrote that one of the big stories of 2016 was the decline in viewership of the NFL. How big was the decline? Down 8%.

Prime Time games were down the most with an audience erosion of 10 to 12%.

Commuter Traffic

The Federal Highway Administration says that by 2025 passenger miles traveled will have increased 72%. Why? Because that same agency says our population will have increased by 26% by that same year.

Tell me the road you commute to and from work isn’t already over congested.

Why is Country Music not the Top Radio Format in Nashville?

Nielsen Audio did a research study in 2014 and said the top radio format in America was country music. Ironically, the top radio station in Music City aka Nashville was NOT a country station. And it’s still not.

The latest ratings for Nashville show the highest rated country music station is ranked #7. The following radio formats are all ahead of that country station: Adult Contemporary, CHR, Sports, Urban AC, Talk and Variety Hits.

However, if you combine all of the audience of the many country format radio stations in Nashville, you will have a higher share of audience than the number one radio station commands.

Less Is More

So while you cannot have too much fun, wisdom, or love, you can have too many choices of products and services. Great for consumers’ maybe, but not for business owner/operators. Ask those who are dealing with the increase in college bowl games, NFL games, traffic congestion or playing country music in Nashville.

Radio is experiencing its own issues with supply versus demand.

The FCC will open up two windows for new translators this year. That’s after 750 new FM translators were signed on in 2016. Currently there are 19,778 FM signals beating the airwaves throughout America. Compare that to 4,669 AM radio stations currently on the air.

At the point in America’s history when the same number of AM radio stations equaled the number of FM radio stations on the air in America (end of 1992), 75% of all radio listening was to FM radio.

The Psychological Aspects of Overpopulation

This brings me back to my own undergraduate college days and psychology class. I remember learning about an experiment about putting too many rats into a confined space.

“As the number of rats rose above a certain level, the effects became rather dramatic,” wrote Albert J. M. Wessendorp, Psychologist-Psychotherapist. The rats displays behavioral disturbances, death rates rose, male rats began to show deviant sexual behavior and more. You can read more here.

Whales are known to commit collective suicide in order to control overpopulation.

What about you and me? How are we impacted by overpopulation (or over choice)?

The research says even human population growth is subject to limits. If we fail in controlling things ourselves, mother nature will begin to do it for us. (Think: Climate Change)

Radio Station Overpopulation

I love the radio business.

I share these thoughts because I’m concerned that the current overpopulation of the FM band is not taking into consideration the laws of physics or the impact of anything that gets overpopulated.

The FRC when it was formed (Federal agency that pre-dates our current FCC) it made it its mission to see America have quality radio stations or a large quantity of mediocre ones. We now look back on this period of time as “The Golden Age of Radio.”

Wessendorp writes that Maslow taught us that “People are only stirred into action when they feel their basic needs to be threatened.”

Have you looked at the revenue forecasts for radio for 2017? Are you feeling threatened yet?

What You Can Do

Next week I will continue with this topic and offer up what I believe is a solution to radio’s problem in an overpopulated entertainment world.

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Are We Killing the Golden Goose?

25Do you remember Aesop’s fable of the goose that laid the gold eggs? Let me refresh your memory of this tale. It’s about a farmer that was poor. One day he makes a startling discovery when he finds a golden egg in the nest of his pet goose. Skeptical at first, he has the egg tested and finds that it is indeed made of pure gold. Even more amazing, each day this farmer awakes to find that his goose has laid another golden egg. In very short order, this poor farmer becomes fabulously wealthy. But then his wealth brings greed and impatience. No longer satisfied with just one golden egg per day, the farmer cuts open his goose to harvest all of its golden eggs at once only to find the goose is empty inside. With a now dead goose, there will be no more golden eggs laid.

In remembering this fable, it sounded so familiar to the world of radio broadcasting. A radio station was like a wonderful “goose” that laid daily “golden eggs” for many an owner. It was an industry joke that having an FCC broadcast license was like having a license to print money. It was “golden.”

But broadcasters not wishing to wait for each day’s golden egg, cut open their goose with the Telcom Act of 1996. Twenty years ago, this act deregulated radio and now owners, like the farmer cutting open his goose to get all the eggs at once, now could own as many radio stations as they basically wished.

And how did that work out? Not much better than what the farmer discovered.

The moral of Aesop’s fable is if you focus only on the golden eggs and neglect the goose that lays them, you will soon be without the very asset that produces the golden eggs.

The radio industry’s quest for short-term returns, or results, took their free FCC licenses and ruined them by not maintaining the balance between the production of desired results and the production capacity of the asset.

Aesop’s fable is the very principle of effectiveness. It’s a natural law. Like gravity, you don’t have to believe in it or understand its principles, but you can never escape its effects.

Radio broadcasters probably saw the moral of the fable being the more geese you own, the more spots you add to the hour, the more effective your R.O.I. (Return On Investment) will be. But ironically, it was the principle of “Less Is More” that in the end rules the day.

To be truly effective, you need to maintain the balance of what is produced (golden eggs/revenue) and the producing asset (your goose/radio station).

Stephen Covey wrote extensively about all of this in his book “The Seven Habits of Highly Effective People.”

When people fail to respect the P/PC Balance in their use of physical assets in organizations, they decrease organizational effectiveness and often leave others with dying geese.”

-Stephen Covey

One could certainly make that case for two of America’s largest radio broadcasters today. They are reaping the results of those who’ve gone before them who’ve in essence liquidated the asset, before they took over and now the accounting system appears to show that they are not performing at the level of their predecessors. But is that really the case? Did they in reality inherit a very sick goose when they took over? The debt problem say many who are more schooled in this area of high finance than I, will probably be addressed with a re-set. And once that happens, it will come back to the people of radio.

Covey says to “always treat your employees exactly the way you want them to treat your best customers.” Herb Kelleher at Southwest Airlines built his company on this very Covey principle.

Covey puts it this way: “You can buy a person’s hand, but you can’t buy his heart. His heart is where his enthusiasm, his loyalty is. You can buy his back, but you can buy his brain. That’s where his creativity is, his ingenuity, his resourcefulness.”

The bottom line is the future of radio will be determined by the vision of the people leading the radio industry. It will also be determined by the hiring decisions they make going forward.

“If you hire people just because they can do a job,

they’ll work for your money.

But if you hire people who believe what you believe,

they’ll work for you with blood and sweat and tears.”

-Simon Sinek

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Day of Reckoning

20There’s an old saying “Nothing lasts forever.” Do you remember flying on TWA or Pam Am? How about shopping at Woolworths? Broadcasters will remember names like Group W Westinghouse Broadcasting, or Taft Broadcasting, or Nationwide, or RKO General that would put the successful Bill Drake Top 40 format (with the non-stop innovations & promotions of 93-KHJ’s Ron Jacobs) in major cities across North America. They’re all now a memory.

In a time of limited radio signals, radio could control its inventory and increase stakeholder ROI by raising rates as it increased the size of its audience. That’s now a memory.

Next came the Local Marketing Agreement (LMA) to soak up all those Docket 80-90 FM signals that were squeezed into the FM band but found themselves economically challenged. More signals meant a new way to make more money. That’s now a memory.

LMAs were “training pants” for the Telcom Act of 1996 that would unleash a consolidation of radio and television ownership like the world had never seen. Companies would rush to acquire as many radio signals as they could as fast as they could. And do what with them? They would figure that out later was the common response. Owning more stations was a way to make more money, until it wasn’t. That’s now a memory.

You might have thought that would have sent a message that there are limits. It didn’t.

Today the game is translators. And the number of radio signals continues to grow, all seeking funding through advertising, just like every other form of media out there today.

So is the ad pie growing? Not according to Adam Levy at Motley Fool who saw advertising drop nearly 4 percent in the second quarter of 2015.

When the advertising pie isn’t getting bigger, two things usually happen: 1) budgets get cut and people lose their jobs and 2) more spots are added to the hour. Unfortunately, all through consolidation and the Great Recession radio companies have been doing both. They are like the Federal Reserve wondering what you do when you already have cut the interest rate to zero to stimulate the economy. Not a fun place to be.

Suggested Solutions

 Not to be all doom and gloom on you, I think there are some things that can be done to turn things around. The first thing is to focus on something and own it. Steve Jobs would put it this way “Just get rid of the crappy stuff and focus on the good stuff.” The way Jobs took Apple from near extinction to the world’s most valuable company was by his relentless focus on creating a small number of simple and elegant products.

Seth Godin calls it finding and serving your tribe. Radio needs to give up the quest to be all things to all people and learn to be something some people can’t live without.

Some stations can be the national brand in town, but everyone can’t. Likewise if people can get what you do someplace else, then why do they need you? This is the secret of “less is more.”

Radio stations need to have the agility to make decisions on the front line. Top down management is out, front line management is in. Mary Berner, the new CEO of Cumulus gets it. She has been reported in the trades saying “Cumulus will rely less on top-down management and more on letting managers do the job they were hired for.”  She also understands that while IoT (Internet of Things) is the future, it’s not the place Cumulus needs to focus on today. It’s about changing the culture and the way the company operates first. Getting the programming right and improving sales of those radio programs next.

I remember when I starting working for Clear Channel and hired to turn things around in my market, the company had a big push on selling the web and developing that component. I told my sales manager after the conference call ended that was not going to be the case for us. First we needed to get the programming and radio sales on fire and then – and only then – would we begin tackling our web based program. It worked too.

The hardest thing sometimes is not doing things, but figuring out what to stop doing. Jobs was good at this at Apple. You need to invest some serious thought about what you need to stop doing in your radio property. Again, less IS more if done right.

And the last suggestion I have is directed at colleges and universities. We need to be focused on the business model of radio and putting more of a focus on the business side of radio and radio sales. Radio owners and operators I talk with aren’t clamoring for more DJs or news people like they are for more sales people and innovators that will create the next revenue stream for their property.

In the end, your audience size won’t matter if you don’t have a business model to monetize it.

 

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What Ronald McDonald Could Teach Radio

Today in America there are more radio stations on the air than at any time in its almost 100 year history. More radio stations are taking to the air every day. That’s a good thing, right? I would argue it’s not.

When I was working for Clear Channel Radio (yes, it was once called that – now it’s iHeartMedia), the President was a man named John Hogan. Hogan came up with a plan to reduce clutter. He called it “Less is More.” On the surface it sounded like a grand plan. However, the devil is always in the details and the devil was Clear Channel was now going to move away from a unit based inventory management system to a one that included half-minute long commercials, ten-second commercials, five-second long commercials it branded as “adlets” and one-second long commercials it branded as “blinks.” In the “blink” of an eye, the amount of units grew and we would learn that people don’t notice the length of commercials as much as they do the number of interruptions they are confronted with. “Less is More” would inadvertently introduce more clutter in the name of reducing clutter.

Well some clown named Ronald McDonald must have been watching us because at the end of last year, McDonalds announced that its menu had become so unwieldy that even the chain’s president had no clue as to how many items it contained.

In his book, “The Paradox of Choice – Why More is Less” psychologist Barry Schwartz argues that eliminating consumer choices can greatly reduce anxiety for consumers. That while autonomy and the freedom of choice can be healthy and good for our well being, modern Americans are faced with more choices than any group of people in the history of the planet and all this choice is having the reverse effect.

I remember the headline in Forbes “You Can Now Play 100,000 Radio Stations On Your TV with Google’s Chromecast.” A hundred grand? I have trouble finding enough radio stations I want to listen to, to fill the pre-sets on my car radio and they only give me pre-sets for 6 AM stations and 12 FM stations. I have a 10-minute commute on a bad day, so I don’t do a lot of button pushing.

Edison Research now calls their radio study the “Infinite Dial” because with the advent of streaming audio, we have the ability to listen to radio stations all over the world. I have ten Apps for listening to streaming radio on my iPhone and iPad. Of those, I primarily use three of them the bulk of the time. Of the three, one dominates. That single App now curates over 90 different genres of music. The good news is that I can create a “Favorites” section so I only need to choose from a limited number of genres to match my mood.

When radio began consolidating into clusters, adding HD signals & sub-channels and then streaming, the complexity proved to be a challenge to an ever shrinking workforce challenged with programming and selling all of those product offerings.

Schwartz tells us that modern psychology shows that happiness is affected by success or failure of goal achievement. Radio workers and McDonald’s folks probably aren’t all that happy; not like they once were.

McDonalds last year recorded its worst domestic comparable sales figures in more than a decade. In radio, being even with last year’s numbers was being called the new “up.”

McDonalds plan is to reduce the number of choices, focus on those items they will serve to improve their quality to delight the customer.

Most people’s cable or satellite TV package delivers hundreds of channels and yet, the most common thing people are heard to say “there’s nothing GOOD on to watch.” “Good” being the operative word. What a change from when I was growing up and my biggest problem was a GREAT show was playing on all three television networks; at the same time (days before VCRs and DVRs).

Radio in that same era was exciting, innovative and totally focused on delivering great content. These were the days when a Top40 radio station like CKLW had a 20-person news department on a radio station that was all about music not news. Had an air staff that was refreshed every three hours with a new disc jockey, had an off-air program director, a music director & assistant that did music research, a promotions department & promotions budget, plus consultants all for a single radio station.

Less is more works if more people can focus their attention on less.

Take it from a famous restaurant clown, “Less IS More” in more ways than one.

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