March 3, 2014
For as long as radio been broadcast from towers, advertisers have been demanding accountability in the form of attributable results ... a direct-response on steroids. Bill Freund believes he has a real-time digital answer to that demand in Clip Interactive, which can serve up not just advertising offers, but content promotions, morning show bits and music directly to listeners' smartphones. And it's already showing results in Portland and San Diego. Here Fruend explains just how it works and what radio could profit from it.
Bill, what attracted you to join Clip Interactive as EVP/CRO after seven years of building the streaming audio space as co-founder of Triton Digital?
I had been in the radio business for 15 years and I saw broadcast radio getting attacked by digital media -- particularly by search. Early on I was working at Katz and then Westwood One, and my longtime seven-figure radio clients started telling me, "Search works a lot better because we can directly attribute results to it" -- and soon they started moving big chunks of their radio spend to Search. But, I always knew in the back of mind that radio's awareness message was the driver of Search, but I couldn't prove it. What would end up happening is the agency would cancel or cut back their radio buys, but then their Search campaigns would start to loose momentum after a few months because there was no awareness of the brand. What this proved to me was that radio's awareness message drives Search queries. The smart marketers would figure it out and would come back six months later because radio and Search worked better together -- especially the awareness factor to drive search.
My first venture into digital for radio was Triton, to give radio interactive capabilities using the stream. The goal was to give terrestrial radio the needed interactive capabilities, but after over seven years of doing that the challenge became that terrestrial radio never really benefited that greatly from streaming. With 90% of the listenership still with broadcast, the guys who are benefiting from digital interactivity have been Pandora, Spotify, iTunes and others ... not so much broadcasters. Although Triton was a great success as the leading streaming company, terrestrial radio still didn't get enough benefit from streaming alone; it needed something more than streaming. It needed something that worked with the over-the-air broadcast.
Is that what made you head for Clip Interactive?
My partners at Triton and I built the largest Net-based audio solutions company; we had nearly 5,000 clients, both terrestrial and IPs, from Pandora to large and small broadcasters. After seven years, I decided to do something different and started looking for the next game changer I could take to market for Radio. And luckily I came onto Clip Interactive. What was interesting about Clip was that it solved the problem I set out to solve -- how to make terrestrial broadcast benefit from interactive capabilities. Clip Interactive works with the native element of radio ... literally the sound coming from the speakers. It allows radio listeners to use the Clip Radio mobile app that enables listeners to receive related digital content tied to what's playing on-air ... in essence, pulling interactive content, tied to the broadcast, off of the radio.
Up till now, broadcast radio had tried streaming and generated some success building loyalty through their websites, Facebook and Twitter. Clip Interactive takes this much further, by delivering content right off of the broadcast that the listener can interact with - and also track how and when it is used by the listener. Clip does not send them someplace else, it gets to "lean in" and engage with what they hear immediately.
So I went out to see the many ad agency partners I did millions of dollars in business with when I was in broadcast and streaming radio, and I told then that Clip could bring digital capabilities to the over-the-air broadcast, visual and mobile, interactivity and attribution, and what that would mean to clients who wanted more qualified results from radio. Clip puts radio on a whole new level for clients who say they like radio, but are skeptical because they can't prove how listeners respond. Clip Interactive offers actual results-driven data. My trusted agency clients told me that if we could bring it to scale, we'd have a game-changing piece of technology for broadcast radio that would reinvigorate radio with their clients.
Was Clip completely up and running when you came aboard, or did you have to make further tweaks to it?
When I got there, the technology was developed. In the last year, we launched a 2.0 version. It can work with any broadcast station as well as stream in any market we deploy.
So just how does Clip work?
We build branded mobile apps for stations that completely sync with the terrestrial broadcasts; so everything that comes across a broadcast is identified -- the station, music, promotions, contests, talk and ads. This Clipped content is then stored in the Clip Radio app, providing a visual related to the on-air radio message. The mobile content is reflective of what's being broadcast. It's a complete end-to-end solution for broadcasters. It gives local clients the ability to run a visual piece of content for mobile that's interactive with every broadcast radio spot they run. And it's all done through proprietary content identification technologies enabling the identification of the station the listener is tuned to.
I can see people using the Clip Radio app when they're looking at their cellphones, but what about when they're driving?
There are a couple of ways to use the Clip Radio app. If the user is listening and isn't distracted by driving, he or she can hit the Clip button and immediately receive the identified interactive content. But say the person is busy when he or she hears something interesting and can't respond to it at that moment. A Clip of that content can still be delivered on a daypart basis by the app, which puts the content on their Clip list for use at a later time when they are ready to engage with what they heard earlier. The Clip content feed we supply becomes a catch-all for everything aired on the station, letting the listener go back in time and receive it. This extends the life of the broadcast and most importantly, attributes that interest and listeners' response back to the specific station they heard. No more radio creating awareness and results that end up at Google or MSN with no credit for radio.
So someone could receive content from memorable morning show bit later in the day - essentially Tivoing it.
Yes in a way ... Clip Interactive allows you to use complementary content related to the show - it could be visual, something spoken, anything you want. The board op or producer can easily make Clips of this during the show -- as the show is happening The clip uses a CMS (content management solution) that enables them to create content Clips as the show is happening,
Is it that easy to do?
We have fully built CMS that has permission-based use for the local stations. You can set up a video, a virtual coupon, free music downloads ... pretty much anything you can do on the web or mobile today can now be tied to the audio of any live radio broadcast. If the morning show producer knows he has a great interview coming up, he can make a Clip of it for use within minutes. So, for example, there's a great interview or promotion you do, the program director can set up matching content, maybe a poll, survey or video that drives deeper engagement into the show -- all accessible with a tap of the Clip button on your station app. Or say a producer can only air a segment of an interview but would like to share more of it with its listeners. A clip can be created to provide exclusive content and once again creates another reason for the listener to lean in and engage with that stations content.
Describe the initial reception terrestrial radio has had for Clip Interactive. How much effort do you put into convincing them of the need for this?
It's happening, but it always takes longer than you always anticipate. The reality is this: the radio business is motivated by two things -- revenue and the fear of losing revenue. That's what motivates most radio operators. We're out there helping them understand that Clip enables them to compete for revenue they previously couldn't get because they didn't know how to optimize radio's capabilities. With all the non-radio advertisers and digital advertisers who lost faith in radio because there was no response or engagement data, now radio can go out and re-approach them showing listener response and engagement data directly from radio ... not just hoping to correlate Search results, web visits, and phone call volume. Clip provides response data with permission-based listener data for follow-up and re-marketing. Advertisers are really embracing this concept with our partner Alpha Broadcasting in Portland, where Clip has generated over a quarter-million dollars in revenue in the first quarter alone.
Can you give some examples of Clip successes?
Alpha has a campaign for a regional dental client who was spending north of $50,000 on search and digital advertising in the quarter prior to this -- and had not considered radio, because radio prior to Clip could not deliver proof of performance and response data, but with Clip they are now using radio in Portland.
Now they're running 30- and 60-second spots on Alpha/Portland, offering a free teeth whitening if they become a patient - but the only way listeners can get the offer is to Clip their radio spot and receive it on a mobile Clip list. We delivered over 900 new patient leads to this client in three weeks. All they had to do was hear the spot on the radio, hit the clip button to get the offer immediately. Thus the client ended with up 900 permission-based e-mail addresses. The client had never seen this kind of response from radio before.
Alpha is also doing clip campaigns for Paul Mitchell Beauty Schools, cosmetic medicine, Kaiser and lots of others. The key to all this is that Alpha is bringing real results back to the clients that prove radio works.
Are you worried that doing a lot of Clip campaigns at once might confuse the consumer?
No. The good news is that Clip mirrors what is running on-air. Whether it's advertising, a promotion or a contest, it can be Clip-enabled, and all you have to do is mention on-air that you can Clip this spot. Over time, the need to mention this will become unnecessary. Station will do what they do best ... train listeners to react. There will be a tipping point when a station can broadcast that they are interactive, what it means and then listeners will know that all content can be clipped, removing the need to mention it every time. For now it's new and listeners need to be educated. However, we are quickly seeing that the education can happen quickly and listeners want to engage. Now they have a conduit to do it.
That said, not everything that's Clipped will build adoption and awareness, but from where I sit, I can see a day when one of these big groups is going to put a flag in the ground with Clip to make sure everything they do on the air is Clippable . Being able to provide interactive radio at scale across the market is a game-changer.
Once everything is Clipped-enabled and the radio talent is constantly promoting the Clipping activity, wouldn't there be "clip clutter," a la broadcast clutter?
No, but, that's an interesting point. The way I see it, it is the exact opposite. Clip makes radio spots more effective by people knowing that if they are interested they can respond, and if they do that, stations have proof it works and can raise the unit rate and possibly not run so many commercials because they're producing real-time quantifiable ROI data. So it could actually reduce on-air spot loads from the current 10-14 units, to a lower more effective level, but sold at a premium. To my last point, there will be a point where a broadcast need only say they are an interactive radio station, whereby all content can be clipped and engaged with. This is what the future of interactive radio looks like.
There was a recent study on iTunes Radio, which found that people aren't buying music from the service as much as they hoped. People are passively listening to it instead of buying music off it. Is that mentality a challenge for Clip Interactive?
I don't think so. You can download and buy songs thru Clip Interactive, just as you can with Pandora and Spotify. The difference is that they're essentially offering one thing ... a commodity, music ... and they all offer access to the same songs, be it through an alogrhythm or a curator. Clip Interactive offers deeper engagement what they don't have - local personalities and local content that's unique and exclusive to the local station. That's what people engage with through Clip Interactive for - personalities, contests, events, promotions ... Clip leverages the unique local aspects of radio that makes people want to engage.
A lot of people believe there will be a shakeout of all these music streaming services. If that happens, are you worried about being dragged down by the perception of this being another "Tech Bubble?
Actually, I think such a shakeout would work in our favor. Here's the reality: Streaming radio has a national average quarter-hour of 2.7 million people - and of that, nearly 1.9 million are using Pandora. Pandora's the dominant player and all the others are basically carving up the rest. Terrestrial radio's AQH is 25 million, literally 10 times that of the IPs. Clip is looking to leverage 25 million broadcast AQH with our piece of technology, not just the 2.7 million on the streams. Clip enables radio to engage and drive measured response from the 25 million AQH of terrestrial radio.
Clip enables interactivity of the broadcast, where 90% of all listening is occurring today and stream. Streaming services merely play music, often the same tracks, and don't offer interactivity. Our recipe is simple: Provide local interactive content tied to the broadcast, enabling listeners to be more engaged with what they hear and be able to act on it. Up to this point, radio has been a one-way medium. With our technology, we are changing that. Listeners can now respond to what they hear. Additionally advertisers and stations can now benefit from knowing if their offerings are being well received. Now a station can optimize a promotion to get more listeners tuned in. Advertisers can change test offers because they'll know relatively quickly what gets listeners to engage. This is what will advance radio. Broadcast and streaming radio can now be engaged with, measured and optimized with our technology. That is an offering none of these streaming services have and what excludes us from any such shakeout.
Where do you see broadcast radio in 10 years - and how integrated will Clip Interactive be with radio?
My belief is that radio is just starting to understand that there are technologies that can make their broadcasts richer and more interactive. The real question is how quick they will adopt it and make it their own before others do it without radio. We are the exclusive solution for local radio to be interactive and attributable. We identify local station content and activity, and that's what I believe will be the success driver of everything - as what is happening Portland and San Diego spreads to other markets. advertisers will follow the eyes and ears ...and ad money always follows the eyes and ears ... and broadcast radio always follows the money. We are proving that Clip Interactive capabilities can bring in new revenue for radio, and as that becomes as big a success, we believe Clip is a technology that will used and adopted by all advertisers and broadcasters.