Seven years ago, on this Sunday morning I wrote a blog article titled “Out, damn’d spot!” The title for the blog came from Lady Macbeth, Act 5, scene1, where the spot the Bard’s lady is talking about is the imaginary blood she sees on her hands from the murders and other crimes she and her husband have been involved in. (Not all that dissimilar to how too many spots are killing radio.)
The genesis for that article was born from a speech then CBS Radio President Dan Mason gave in 2016, about how many radio spots should run in a typical hour of radio programming; his answer was 8 to 10 units.
Well, more than half a decade later, the majority of operators in the radio industry, have made very little progress on putting themselves on a strict advertising unit diet.
Limiting Unit Loads in 2023
Radio Ink started the conversation about unit loads again, in an interview with One Putt Broadcasting’s owner, John Ostlund who says he limited the number of ads on his five radio stations to five minutes per hour. Before the reduction, Ostlund says his stations typically were running 10 to 12 minutes (or more) per hour of ads.
As I read the interview, I realized that everything One Putt Broadcasting’s doing, is how radio was back in the 60s and 70s; ‘everything that was old is new again.’
Then Radio Ink heard from Bill Lynch, General Manage at Momentum Broadcasting about how he’s been running short stopsets for a decade and it’s been financially beneficial to his radio stations. Bill doesn’t think “length” when it comes to the number of ads in each hour, he thinks “units.”
It’s About The Units
Radio Program Gary Berkowitz then authored an article for Radio Ink giving his perspective as a longtime radio programmer and consultant. Gary said:
“If going forward we expect to be relevant,
we simply must cut back on the number of commercials we run.
Argue with me, but listeners do not count minutes.
They count “messages” or units.”
Back in the 80s in Atlantic City, reducing the number of units on my radio stations, saw both audience numbers and revenue growth. So, it was a pleasure to read this still works in the 21st Century.
Radio & Casinos Have Something In Common
In the beginning, both the radio business and the casino business enjoyed scarcity. In the early days, there weren’t a lot of radio stations in America, and if you wanted to own a casino, you needed to be in Nevada (1931). For almost half a decade, Reno and Las Vegas had the monopoly on the casino business until 1978 when New Jersey would be the second state in America to legalize casino gambling.
Most communities were lucky if they had one radio station, it was a time in broadcasting that people would say, ‘owning a radio station is a license to print money.’
What changed for the casino industry was a wave of states legalizing casino gaming all across America quickly disrupting the business models for Nevada and Atlantic City casinos. No longer could they live off just their gambling handles.
Radio station ownership also exploded with multiple radio station signals filling up every available frequency in every populated area in the United States.
The Most Profitable Resort in Las Vegas
Seven years ago, when I wrote my original article, the most profitable casino in Las Vegas was Wynn Resorts and as of September 2022, it still is. What’s Wynn doing that’s different? Wynn Resorts are totally focused on the visitor or user experience.
Steve Wynn changed his casino business model to one less dependent on gambling, to a focus on non-gaming revenues and customer experiences, which now account for 67% of his company’s revenues.
What John Ostlund, Bill Lynch and Gary Berkowitz are telling the radio industry is much the same, that to not just survive, but thrive in the 21st Century, the radio industry must focus on its two main constituencies; the radio listener and the radio advertiser. Both, it turns out, want the same thing; a less cluttered advertising environment.
This should be the focus of the entire radio industry, as Bill Lynch puts it so well:
“It doesn’t matter if there’s one nice house
in a rundown neighborhood,
if most of the neighborhood is run down,
people don’t buy there.”
DickTaylorBlog 