Radio Competing In The Digital Age
May 10, 2016
I had an epiphany about radio when I was programming Q101 Chicago in the '80s. Every day at exactly 3 o'clock, all the office staff radios switched from Q101 to listen to Steve Dahl and Gary Meir on competitor WLS-FM. I decided to listen one day, and it changed my view of radio forever. Steve and Gary were real, funny, and they connected emotionally. They only played four songs an hour on a Top 40 music station, and they had killer ratings!
We know young people today listen to their playlists and consume lots of online media. So, in view of the recent announcement that CBS is interested in selling their radio division and all the "radio is dying" talk, I ask my three millennial daughters and their friends if they listen to radio. Their collective response was to name Carson Daly, Woody, and Ryan Seacrest. They didn't say Amp Radio, Kiss or 98.7 KYSR. And this is in Los Angeles, one of the world's most advanced media cities. Hmm...
Let's get some altitude on the "radio is dying" narrative and do it with authenticity and with action. The only constant is change, and it is wise to act while not over-reacting.
AM/FM radio is strong; 90% of the US population uses radio weekly and 68% daily, yet listenership is either flat or slowly declining, depending on what study you read. What is growing is online listenership. The bad news is that Pandora takes the lion's share of the audience, and Spotify is a distant second.
There is actually more concern about losing advertisers than losing listeners. There's a whole new array of marketing tools that enable advertisers to measure ROI (return on investment), such as website analytics, social media metrics and marketing automation. Spot sales advertising is not as quantifiable.
The digital offerings and platforms will continue to fragment and divide the audience's entertainment time. Radio has to remain relevant with create killer content to compete.
The future of radio is talent. Here's why:
People will choose entertaining personalities regardless of the source (e.g. Carson Daly, Woody, and Ryan Seacrest).
Personality endorsements make a major impact and demonstrate a big ROI.
Radio is not going to beat Pandora and personal playlists. However, Pandora can't create a relationship with listeners the way radio air talents can. Pandora can't be at the Taylor Swift concert. Pandora can't update you on the snow storm in Denver. Pandora can't be the companion that radio can be.
Radio was the first social media. Its personal two-way communication continues with interaction on the phone, online and texting.
Radio is free, convenient and in your kitchen, in your car and on your phone.
The Action Plan:
All products and services move through four marketing life stages:
- The ascent
Radio is at a 3.2. At this stage, in order to stay at #3 Peak, you have to fortify your strengths and mitigate your vulnerabilities. So here we go:
Music is ubiquitous. Radio must focus on where the ball is going now and invest in people instead of playlists.
Take a tip from Australia and the U.K. They invest in developing talent, and many of their radio morning personalities are celebrities on the same stage as TV, movie and sports stars. They also have personalities in all dayparts who play a lot of music and present it with pizazz.
We encourage radio decision makers to redirect promotional, marketing and contest budgets to hiring and developing great talent for the future. Engaging talent brings word-of-mouth marketing, which is more powerful and cheaper than a slew of billboards and "$1000" Thursday contests.
Embrace podcasting. It is growing at an impressive rate. NPR programs like This American Life and Fresh Air are the biggest winners among radio players. Preston and Steve, Dave Ramsey, and Holmbert from KUPD/Phoenix are top contenders, too, yet radio shows are not well-represented in this growing arena.
We have to embrace the importance of using the new ROI tools in advertising to maintain and grow revenue.
Content is not king. Killer content is king. Killer content is created by HD personalities. They are the future of radio.