March 15, 2011
Mark Ramsey has offered his expertise in strategy and research to the largest radio groups in the U.S. and abroad, yet at the same time has long expressed views on radio and digital media that have occasionally been at odds with the radio establishment. Nonetheless, Ramsey's insight has helped many in the business catch up to the cutting edge of the radio/digital revolution. Before you see him in person at the Worldwide Radio Summit on April 29th-30th in Hollywood, you can read up on where his mind is at here.
For years, through your research and marketing company ... as well as your blog and, more recently, your Area 51 column in All Access ... you've made your views quite clear on how radio should respond to the changing paradigms in reaching its audience. Do you ever feel like Don Quixote, who is essentially tilting at windmills in trying to spur radio into the Brave New Digital World?
I think it's a process. I don't feel like Don Quixote anymore than I feel like Chicken Little who claims, "The sky is falling." I feel like those who listen, listen ... those who hear, hear ... those who act, act ... and the rest are largely tangential and tuned out. The same thing goes on with any brand presence, which collects its interested audience and doesn't collect anyone else. That's the way the Internet works; that's way a brand works ... and that's the way radio is going to work from now on.
My attitude is, "Pay attention if you want to," but life is way too short for me to get frustrated about people who fail to act, because I constantly hear from people who do act, who appreciate the message and who act on it, so I'm not in any way discouraged or frustrated.
At times I do feel like I'm climbing uphill, or I'm shouting against wind, but if I wasn't doing that, life would be boring. Sometimes people ask me to do interviews with prominent PDs, but why would you want hear from the same person over and over again, who've been saying the same stuff forever? Why do I need to provide that? Stuff that worked for me was stuff the audience related to the best. My job with the videos is to provide something more challenging.
Allen Kepler's talk on the PPM is something more challenging and of keen interest at the same time. It's gotten 2,000 views, which may not seem like much in the whole Internet universe, but only so many people care about the PPM - namely, broadcasters - so within that vertical market, attention is keen. It had gotten more than 65,000 video views so far.
Let's get right to the gist of the Kepler video. He did a non-scientific, one-on-one interview survey that found PPM respondents who were basically doing it for the money and/or were contest "prize pigs." If true, what does that say about the PPM and radio's de facto endorsement of it as the official monitoring device for the industry?
Here's the thing: When Arbitron comes to you and says, "We agree that we need to increase participation in PPM ... here are our ideas ... idea #1, let's incentivize by offering more money ... #2, let's create points and games to get people engaged, to participate and involve them in the process. We plug both of those things in - which certainly encourage participation - and we have done our job." So they did; they created those two ways to do it, which has worked.
In other words, you and I can look at these respondents as prize pigs or game junkies, but the reality is, the reason why they're playing the games and accepting the cash is because those are the incentives put in place to motivate them to participate. We're getting what we ask for. We should not be surprised when incentives become the reason for some people to participate anymore than getting a free tote bag is a big reason to donate to a public radio station. Is it a bad thing to get a CD of a live performance of "Les Miserables" for giving money to PBS ... or is that giving people exactly what they're asking for?
Doesn't this infer that Arbitron and radio care more about a quantitative sample size than a qualitative one?
Granted, that is apart from the issue of, "Are these particular people representative of radio consumers?" Some people say the fact they're not radio fans doesn't make them more representative. Others say it actually makes them more representative of the general public. It's insane. We have to be careful of what we wish for because we may get it -- and guess what ... we got it.
By the way, all of this presumes that Allen Kepler's data -- totally anecdotal of just 13 panelists -- is accurate ... and we don't know that for sure. Allen would be the first to tell you that he doesn't know that for sure. But my guess is that it's more representative than not.
Yet by paying big money for PPM - and changing the way they program to suit what PPM counts as a "representative sample" of radio listening -- isn't radio now complicit in caring more about winning "the game" than in generating loyal listeners?
I care keenly about what radio listeners want to hear ... and I recognize there is a relationship between what they hear and the way they behave in the presence of PPM meter. I also recognize a relationship exists between listening and the PPM, but it's not a black and white issue.
At the same time, it would be foolish for radio not to play the PPM game when it determines their livelihood and success or failure. To do anything else would be foolish. Whether it turns out be the best game down the road remains to be seen. PPM is all about measuring passive usage - and that's fine if your goal is attracting passive users. But should your goal simply be to reach passive users, or should your goal be to compel people to consume something promoted by the station? If you think the best way to do that is having a strong relationship with your listeners, reaching them though your personalities, that's another matter than attracting passive users.
You may have noticed that some of the best-ranked stations, in terms of earnings, are News/Talk stations, which rarely if ever get the highest ratings ... why? Their listeners may be fewer in number, but they have stronger relationships with those stations and their hosts, so when those hosts promote a product, they're more apt to buy it.
At some point, a long time ago, the process of placing advertising disconnected with the process of moving products and services. Until that connection happens again, you'll continue to have agencies buying on rankers ... so they can foist interruptive commercials to audiences who prefer to avoid them -- and who don't consider them relevant advertising.
Digital platforms and the Net are changing all that. Facebook, Twitter, Groupon and other tools are changing all that. In fact, just as Arbitron tries harder to generate more accurate measurements of more passive listeners, real marketing is moving to a world where reach and exposure are less important than attention. Just how many people you're reaching is less important than how many people are engaging you.
By the way, I don't blame Arbitron and I don't blame radio stations; I do blame ad agencies and their clients, because if I'm Coke ... and I want to sell Coke ... why do I want to buy advertising that doesn't sell Coke? Broadcasters can help sell Coke, but agencies are still interested more than how stations are rated than how effectively they sell Coke.
Can the Net and/or digital advertising sell Coke more effectively than traditional radio today?
I can't speak to that because it's more complicated than that. It has more to do with what you're trying to achieve online. There's no question Proctor & Gamble moved a lot marketing dollars from pure advertising to other marketing programs, but those are marketing dollars.
Radio is primarily in the business of being a repository for commercials and in generating an audience. Right now, 85% of radio's revenue comes from guys who view the rankers, then place the buys. If that's the game, you're forced to play it whether you like it or not, and if the currency is Arbitron and the measuring instrument is the PPM ... so be it.
I'm not complaining about playing the game. I am saying that at some point in time, when you can show clients about how to get more people to walk in their doors because of what you can do through all your platforms ... when you can actually count those additional people, you can't tell me that won't be worth more to the clients than a station that just runs a schedule.
How much investment should a station invest in its digital/Net platforms ... and what would you counsel station management that wants a ROI sooner rather than later?
You always get what you aspire to be. Do you want to be a weekend golfer ... or a golf pro? Each requires a different level of commitment. You get what you ask for. You want to learn how to play the piano well by practicing just once a week? Good luck to that.
This totally has to do with how broadcasters see the future and the opportunities going forward. If you recognize that the 85% of the money you make from spots today will be 50% a couple years from now, you need to be on the right side on the future or be left holding the bag.
Last year Seth Godin told me something he has been saying for years -- that every radio station should know the e-mail address of all its listeners, since they already have a relationship with them. If a radio station had the e-mail address of all of its listeners, you know what you'd have? Groupon. And that's worth $8 billion now.