Tag Archives: Pierre Bouvard

The Big Game’s Ad Clutter

80During this year’s football season, viewership to the NFL games was down. A lot of reasons were offered as to the reason why. I’m sure you have your own theories. But when it comes to the Super Bowl – “America’s party Sunday” – surely that would again show an audience increase. It didn’t.

M*A*S*H

For many years, the finale of the TV show M*A*S*H was the most watched television show, until the year that a Super Bowl would surge ahead. For a couple of years, each year the Super Bowl of that year would beat the viewership of the past year and ad rates would go up right along with the viewership. Ad clutter too.

$5 Million per 30-Second Ad

This year FOX trumpeted that it sold Super Bowl LI half-minute ads for an astounding $5 Million per ad.

Viewership to the fifty-first Super Bowl game was, like the rest of this year’s NFL season, down.

We have to go back to 2012 to see an audience this small for football’s big game.

Game Stats

Now don’t get me wrong, the NFL is still the 800-pound sports franchise to be reckoned with when it comes to broadcast. But nothing goes up forever and we may be seeing a peak.

The average professional football game lasts three hours and twelve minutes.

The average NFL game will air more than 100 ads.

The average time the ball is in play is 11 minutes.

Does this seem out of balance to you?

Super Bowl LI Ad Clutter

Media Life magazine featured this headline: “Big winner in this year’s Super Bowl: Ad clutter – It’s second-most cluttered game ever, with 51 minutes and 30 seconds”

If you’re in the ad-supported media business, this has to be concerning to you.

Ad rates can’t keep going up, ad clutter going up and audience viewership going down and expect to stay in business.

In a scholarly paper authored by Auburn University’s Herbert Jack Rotfeld he writes, “the increasing advertising to editorial ratio is causing audience inattention and consumer complaints.” And that “more effective advertising would mean that there would be less of it.”

“Abuse of audiences by intrusive advertising lowers the effectiveness of the entire communications form.”

Radio’s Ad Clutter

About a year ago this month I wrote an article entitled “Are We Killing the Golden Goose”  In that article I compared the story of Aesop’s fable of the goose that laid the golden eggs to what I saw going on with the swelling advertising inventory in radio.

Radio is like a golden goose. It has the ability to deliver unlimited revenues to the bottom line for its owners. Having an FCC license was for many years considered akin to having a license to print money.

Radio is the #1 Reach & Frequency Medium

In June 2015 my good friend – and my very first Arbitron representative when I started managing radio in a rated market – Pierre Bouvard would announce that radio was now America’s #1 REACH MEDIUM.

Radio had always been America’s number one frequency medium (the ability to reach a listener with the same message multiple times) but now it beat TV and all other ad-supported media in reaching the most people too.

That’s BIG!

It’s why I’m concerned about ad clutter.

No Ad Blocking in Radio

Radio, unlike online and TV, doesn’t have ad blocking. Online ad blocking is epidemic. TV has the dreaded DVR that allows viewers to fast-forward through the ads.

Radio doesn’t have to deal with these issues, yet.

But that doesn’t mean it can abuse its audience.

Podcasting

Everywhere I turn I see that podcasting is increasing in audience size. But what I’m also reading is how effective the ads in podcasts are. Could the reason be that a single sponsor usually supports podcasts and the ad is often delivered by the very voice that also creates the content that the listener tuned in to hear?

Stephen Covey

Covey wrote 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.”

The bottom line is the future of radio will be determined by the vision of the people leading the radio industry.

Don’t kill the goose.

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Reflecting on Radio Show 2016

60The radio show was close to home this year, just down the road from my university, in Music City USA, Nashville, Tennessee. Plus, the Tennessee Association of Broadcasters decided to roll their annual convention into an opening event at the Radio Show. So as soon as I finished my morning class, I was on the road to Nashville.

Tennessee Association of Broadcasters Kick-off

Whit Adamson, President/CEO of the TAB, put together an amazing opening reception and event inside the Country Music Hall of Fame. We were welcomed by TN Governor Bill Haslam who declared it “Radio Week” in the State of Tennessee. Then the Mayor of Nashville, Megan Barry, gave us a warm welcome to Nashville where she declared it “Radio Week” in Music City. The “red carpet” was fully rolled out for the radio industry and attendance would set a new record for the Radio Show.

Pillsbury’s Broadcast Finance Forecast Leadership Breakfast

The good news is radio is the “King of Audio.” The bad news is that revenue growth for radio underperformed ad spending post-recession. Radio’s 7% share of all advertising is predicted to decline to 6% by 2019. Why? Digital ad spend will grow significantly (40%) by 2019. And radio will struggle to reach mobile users.

The big takeaways from this session were: Investors want to see new growth catalysts like NextRadio, more event revenue and growth in digital/mobile ad revenues. Investors want no more than 3 to 4 times leverage with more industry consolidation. All of this investors feel will yield more “free cash flow.”

Investors worry about audience fragmentation and Millennial reach, radio’s competition in the car dashboard, the challenges coming from digital/internet, continued uncertainty over royalties and excessive leverage.

Focusing on Your Career Future

The room here was filled with young people. Radio mentors from all areas (except engineering) met with tables full of students and recent graduates to talk about the many opportunities available in today’s radio industry. The mood was once of excitement and enthusiasm.

Brittney Quarles and John Focke both would share their personal radio journeys with students as they shared advice such as: “the industry is small, don’t burn any bridges” and “find a champion for you and your talents” and “be careful who you share your dreams with.” The right mentors are essential to your career.

Beyond Basics – The Prosperous, Professional You

John Bates, Elizabeth Burton and Heather Monahan led a session in how to reach beyond your limits and build a better “Brand You.”

John Bates shared “3 ways to inspire and connect”: 1) logic is not the way, 2) human eyes connect you to another person and 3) be authentic. For example, people don’t connect with your successes, but your messes. You message is your mess. But above all else, “Make A Difference.”

Elizabeth Burton drilled down the importance of your online brand and that today your online activities build your reputation.

Heather Monahan told us that people take only 10-seconds to make an opinion about you when they first meet you. 50% of communication is nonverbal and your attitude is everything. And if you want to know what your personal brand is, ask others this question: “What value do I bring to you?”

The Digital Dash – Improving the Consumer Experience

Fred Jacobs, Steve Newberry and Scott Burnell (from Ford) all shared their perspective on radio in the car. The first big thing is car manufacturers don’t call it a radio in the dash anymore (and probably haven’t for some time) but “the center stack.” Into this part of the dashboard, everything a car owner wants can be accessed.

Steve Newberry (former NAB joint board chairman) really brought the whole issue home with his analysis of the technology revolution by saying there are two kinds of events: disruptive and modifying. Disruptive events would be things like television and FM radio. Modifying events would be things like cassette tapes, CDs and MP3s. Disruptive events change the landscape and prevent an entity from doing things the way they’ve always been done. Television stole radio’s programming and added pictures and radio had to reinvent itself with new kinds of programs. Modifying events such as records being replaced by cassettes and 8-track tape, then CDs replacing both of those to be replaced by MP3s merely modified the way people listened to their own music libraries but not how they used radio. The new digital/internet connected world is a disruptive event and radio needs to once again adapt to this revolution in communication. The future is bright if radio is agile and adapts.

Perception vs. Reality – The True Power of Radio

My first Arbitron rep was Pierre Bouvard. He’s a fountain of information. His presentation on “7 Things Brands Have Completely Wrong About Radio” tells the story in great detail and shows the challenges faced by radio sales people today.

Podcasting

Steve Goldstein did an amazing presentation on podcasting by starting out with this Thomas Edison quote from 1922 “The radio craze will die out in time.”

Today mobile is eating the world. 20% of audio listening comes from the smartphone. For radio, podcasting is all about retention, growth and relevance.

Podcasting is no longer niche. It delivers the demos advertisers want. Podcasting is different than broadcasting. There’s money to be made in podcasting and radio has the perfect megaphone to promote podcasts to its audience. That’s radio’s “secret sauce” that podcasters wish they had access to.

Radio – The Local Media Company of the Future

Gordon Borrell and his research company are doing some incredible studies on the future of advertising. He immediately got the audience’s attention when he said in the last ten years $56 Billion has disappeared in advertising expenditures.

Banner ads are dead. But digital is not.

Local advertising growth is forecast to increase 7.6%, but non-digital will see a 6.9% decline in ad spend and digital will see a 22.4% increase in ad spend. In fact, 2017 is the year that digital advertising will eclipse all traditional media.

Borrell said when advertisers cut ad spend in one medium they spend it in another medium. Radio will continue to be bought, but only those stations who have well-trained representatives that understand the realities of today’s advertising and can put together a total marketing plan that goes beyond simply radio spots. Advertisers will partner with any media company who has reps that listen.

The good news is traditional media – like radio – is still necessary to drive digital advertising goals and deliver maximum digital R.O.I. (Return On Investment).  You can see Gordon’s full PowerPoint deck here.

Final Thought

The mood in the halls and in the sessions at this year’s Radio Show was very upbeat. The things being discussed and presented did not shy away from the realities all ad supported media face.

Anyone who attended came away with lots of action steps that need to be implemented immediately.

Radio currently is the #1 Reach & Frequency medium in the United States of America.

There’s no time to waste. It’s time to roll up our sleeves and “Make A Difference.”

Radio’s future depends on it.

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Will Programmatic Buying Help Radio?

My good friend Pierre Bouvard circulated an article on LinkedIn that was published in Ad Age titled “Programmatic TV: Lots of Talk Lately, Not Much Real Action.”  We know what happens in TV land trickles down to radio. That’s what got me thinking about the impact that programmatic buying might make on the radio industry.

First, if you haven’t heard the term, programmatic buying is letting computers buy advertising time. This type of advertising placement is already pretty commonplace in the online world. It can take the form of data-driven real-time purchasing, online auctions or private exchanges, with transactions handled by machines according to Rino Scanzoni, chief investment officer at GroupM. It’s fast, efficient and needs no human sellers.

The large radio companies have been trimming the work force since the beginning of the “Great Recession.” Don’t waste a good crisis was the way one radio industry leader put it at a meeting I attended. Meaning, when the economy is in the dumper and all companies are trimming their expenses to survive, you can use this type of environment to make lots of cuts; especially through RIFs (Reduction In Force).

Computer automation equipment, voice-tracking, syndication, and networking has all replaced live and local radio program origination. However, when it came to ad revenue, the personnel has largely remained intact. Could programmatic buying do to radio sales staffs what the aforementioned computerization did to programming staffs?

The short answer is yes.

At the end of the last decade I watched Google’s ad insertion system place ads onto my radio stations in the very early morning hours. Google’s hardware recorded air checks of every ad they placed on my stations and Google was able to give their advertisers not just a paper verification of the ad running but air checks of every ad, run on every station. Something my local sellers could not do for their clients. It was impressive.

The downside was Google had no idea where anything was in my state and so many of the ads were not appropriate to be airing on my stations for any number of reasons; the most important reason was that business was a hundred miles or more away.

Now while I realize that what I’m talking about here is more programmatic ad placement than programmatic ad buying, I’m making the assumption that the selling of those ads were executed in a similar manner; via automation like Google sells online.

The Ad Age article stated that one big reason that programmatic buying of TV would be a ways off was due to “TV networks also still need to approve the ads before they run, both for standards and to make sure they fit with the surrounding programming. That step doesn’t exist in programmatic ad sales online.”

Remember when radio stations had program directors that listened to everything that would go out over their airwaves to make sure that it met their standards and made sure it fit with the surrounding programming? Ah, the good old days of radio. That attention to detail is why radio sounded so good.

The Google experience taught me that even as a market manager, I no longer had any control over what might be heard over my air. Automated ad insertion is why streaming commercial breaks might air the same commercial multiple times during the same break. It’s a reason that many listeners find listening to over-the-air radio stations online so annoying. (I know I do)

ESPN’s Eric Johnson put it this way: “Programmatic buying means a lot of things to a lot of people. It includes providing some automation to the buying and selling process.”

For radio, only one thing has ever mattered; what comes out of the listener’s speaker. My fear is that as radio continues to abandon this critical aspect of its product in the pursuit of saving money it will kill the goose that lays the golden egg. No one is looking out for the radio listener and in a world of infinite choice, the listener will simply go elsewhere.

You can’t save your way to success.

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