Ink Tank

My Promise For 2008

I'm trying hard not to be one of those old salts who is living in the past, wishing the "good old days of radio" would return. Yes, there are elements of the past that radio can learn from, but if radio returned to the old ways of doing business, we could not succeed in this fast-paced world of digital media. The key to our success will be reinvention and reinvigoration, which are relevant to today's society and to advertisers. Radio remains strong in many ways, but seven years of negative growth on Wall Street have not helped, nor has the recent news of the 6 percent drop in radio advertising in November. Of course, not all radio is about Wall Street and what one reader of ours calls "the radio elite."

In this industry that I love passionately, I am seeing trends that I do not like: Some of radio's best managers and sales managers are resigning over proposed 2008 budgets that cut down to the bone and that they simply want no part of, and some of radio's best are being pushed out by executives who think non-radio people can do better. These group executives are not bad people; they are simply under enormous pressure from investors to solve their problems.

Who Broke A Mirror?
Radio's seven years of bad luck seem to be continuing. We should be investing in our product, yet it's the worst possible time to do so. With economic indicators signaling bigger problems, advertising -- at the end of the food chain -- is usually the first cut made. Although radio sometimes benefits in a recession from advertisers that cannot afford television and move their budgets to lower-cost radio, sadly, many of those advertisers have been seduced by new media and are moving away from traditional media altogether.

I Refuse To Accept Failure
What about you? During the last major economic downturn, Mel Karmazin told his staff at CBS that "recession is not an option" and continued to lead his company with the mindset that failure was unacceptable. It worked -- and while others stumbled, CBS held its own. I believe that each of us must make a personal commitment that, no matter what it takes, we will not allow our medium to decline. We will work harder, smarter, and more passionately than ever.

Human Decency
A decent human being would not abandon a spouse if he or she contracted cancer. Just as your care and attention are needed for a sick family member during a challenging time, your devotion to radio is needed now -- no matter how great your frustration level with your employer. You are not alone. If you got into radio because you love it, garner the devotion to fix it. Mounting pressure has detracted from radio's fun atmosphere, but solving our industrywide sales problem will relieve that pressure. You are valuable and you are needed now.

The Power Of One
Change always starts with one person who is bold enough to try one idea. Your one idea may be the catalyst that will change the radio industry. Ed McLaughlin's vision for Rush Limbaugh was that one idea that saved the dying AM radio band. One idea. Commit to trying new initiatives, even in the face of bold disagreement. Radio needs your innovation now.

Eight Promises To Radio
Don't assume that you cannot change the entire industry. Each of us can make a huge difference, including you. We each need to own the problem, to take on the problem at our personal level, and to experiment boldly. Here is what I am doing personally:

1. I have directed my editorial staff to publish your bold ideas in Radio Ink. I encourage any industry professional, in any size market, to share your vision with the entire industry in hopes that they, too, will try your initiatives. Submit your ideas to Editor-in-Chief Joe Howard  or to me. We want to follow your progress as well, so please keep us posted as ideas develop.

2. I've asked our editors to gather station success stories in all areas -- sales, promotions, marketing, etc.  -- to disseminate practical and profitable ideas from around the country (and the world). This industry has a bad habit of not sharing successful ideas. This must change. We're all in this boat, and this is not a time to be focused on self. We will publish these success stories as you share them.

3. I'm sick and tired of radio stations selling against one another. It's one thing to compete; it's another to try to destroy the reputations of others. If it is happening in your market, I want you to phone me and give me specifics. I will personally call the individuals conducting themselves this way to tell them why they are hurting themselves and radio. Furthermore, I will phone their boss, their regional manager, and their group head. This must stop. And, if my lawyers tell me I can do it without litigation, I will publicly embarrass those who commit this cardinal sin. I need your commitment that 2008 is the year where we will build radio together as an industry and not tear one another down.

4. I will personally offer my time to assist any company that feels it is at a loss over what to do. I will take a proactive approach to meet with the heads of radio companies to offer a fresh perspective on their businesses. Frankly, these people are eminently more qualified than I am when it comes to running radio companies, but a fresh perspective might prompt an idea or two.

5. I will be your messenger. If you feel your company is conducting itself badly, if you see clear mistakes being made, if you have a better way that you are convinced will help your company or your stations, if you are not being heard or fear that you might lose your job for offering suggestions, I will send the message on your behalf. You can e-mail me anonymously and tell me to whom you want your message directed, or you can e-mail me with your name, which I will keep confidential if you ask me to. I will make sure the group heads see your responsible suggestions.

6. The GM of our conference division has been instructed to pack the content of our conferences with even more practical, usable ideas. No fluff! I've instructed her to make sure that each speaker, moderator, and panelist is focused on solid, usable, moneymaking action items that are relevant to your needs, no matter what your market size or conditions. You'll leave with a list of action items you can implement at home the next day. Our upcoming conferences include:

March 10-11, CONVERGENCE: Radio's Digital Media Conference, San Jose
May 19-20, Radio Ink Hispanic Radio Conference, Miami
December 2, Radio Ink FORECAST, New York

7. At our Forecast Conference last month in New York, every group head emphasized the critical need for innovative ideas on how stations can make money in digital media. We've been told by countless market managers that they have been given high interactive budgets and they have no clue how they will meet them. With this specific goal in mind, I have designed our upcoming Convergence conference to do two things: 1) show you what is working and how it's being done (for example, one small-market station generates $600,000 in local interactive revenues, which exceeds its on-air billing) and 2) stretch your brain and make you uncomfortable by exposing you to things happening in Silicon Valley that you need to understand to build your station's interactive strategy to a new level. This conference is critical for managers, sales managers, and PDs -- not your interactive people. As a manager, you must not delegate this until you understand it fully. I've asked that every session have strong, income-generating action items.

8. I've asked Roy Williams to come out of hiding and conduct just one more conference for us. He has agreed to conduct a full-day, invitation-only conference at his private compound in Austin. I've asked Roy to create a special emphasis on building radio in recessionary times and a radio survival strategy. This conference will focus on solving radio's problems at a local level. If you wish to be invited, let me know. I think we can only accommodate 125 or so people.

THE FIGHT OF RADIO'S LIFE
"Small plans do not inflame the hearts of men." -- Napoleon

Radio is surrounded by companies and technologies that want to steal our audiences and our advertisers. Will you let your competitors take them away, knowing they may never return? This is the fight of our life. This is not just about a dip in business, this is about a change in society, driven by technology. It's the perfect storm, as technology meets over leveraged companies with pressure to reduce expenses while the economy is suffering.

Radio is not only a viable medium, it is critical to the people in our towns across America. Perhaps our listeners are flirting with iPhones, digital media devices, and satellite radios, but every ear will be glued to your station when disaster strikes. But we need people glued to us daily. Radio needs to be relevant to communities and individuals at every level, at every station, no matter the format. Your station needs to be compelling now, because compelling radio cannot be touched by any competition. Listeners will only leave if we drive them away by not understanding and meeting their needs. Some in our industry are meeting those needs and reaping the rewards. Others need to become relevant and compelling again.

With your bold thinking, 2008 will be the year we reclaim radio.

It's time for big ideas, bold moves, and true revolution in our industry. It's up to you, not someone else. Are you in?

Post This In Every Sales Department In Radio

It's painful being on the other side of the desk. Because I have a passion for radio and I want radio to succeed, it's hard to see radio people failing. As I've mentioned before, I handle the marketing for a friend who owns a local business. In the year we've been advertising, we've used only one radio station -- and business is soaring. We're now on two stations in the same chain, with double the budget.

During the past year, the business owner and I between us have received only one phone call from a rep at another radio station. A year on the air, and only one other station has phoned to try to get our business.

What's wrong with this picture?

That call was today, from a young, nervous-sounding AE:

Rep: Mr. Rhoads, my name is Joe Salesguy, and I'm from K123.
Me: Yes?
Rep: I spoke to your client, and he told me you handle his radio.
Me: Yes?
Rep: I wondered if you had considered K123.
Me: Nope.
Rep: But K123 is number one in the market.
Me: It is? Really?
Rep (pause): Well, with adults 45-plus.
Me: So....
Rep; Well, I wondered if you would like to change stations or consider K123.
Me: No, thank you.
Rep: But we have the XYZ Sports Team and all these sports packages.
Me: So?
Rep: So you're not interested?
Me: No, thank you.
Rep: Is it OK if I send you a media kit?
Me: No, thank you. Don't waste the postage. I'll just throw it away.
Rep (flustered): But ... you don't want a media kit?
Long pause.
Rep: But we're number one.
Me: No, thank you.
Rep. Ah. Oh ... OK, thanks. Goodbye.

I was not unkind, but I was playing coy because I wanted to know how the salesperson -- who sounded to be around 20 -- would respond. I wanted to know what it's like to be on the client side, and get pitched.

This kid's sales manager should be shot for sending a rep out on to the street with no preparation whatsoever. He had no engaging questions. He did not ask me what I was trying to achieve. The only answers he had for me were about features, not benefits. He pushed features -- and I don't care about features. Little did he know that I have more budget to spend. He never asked.

This poor kid will probably be fired for not getting results, and it's not his fault. It's his boss's fault.

Clients care about one thing: results. Engage me. Speak my language. Do your homework before you call. Find out my needs, my issues, my frustrations, my vision. I don't care if you're number one. I don't care who you have on the air or the reach of your transmitter or the size of your audience. Solve my problem, and my money is yours.

In Radio, Patience Really Is A Virtue

In 1987 I acquired a floundering radio publication called the Pulse of Broadcasting. In retrospect, I'm not exactly sure why I purchased it. I knew nothing about the publishing business, and my losses in the first few years proved it.

However, my goal was clear: to publish the magazine for radio. So, I began implementing changes to develop the industry magazine I wished for during my days as a station owner and manager.

During my first two years in publishing I worked unbelievably hard, yet I could barely get any advertiser or reader attention. In a move of desperation -- and to overcome some serious image issues created by the previous management team -- I changed the name of the magazine to Radio Ink.

We were in the black within two years.

PATIENCE
The Japanese have a term that translates to patient capital. Sometimes start-ups catch on quickly, and sometimes they take time. Had my board of directors insisted on profitability within the first year or two, Radio Ink would not be the heritage brand it is today.

Heritage station KFOG is celebrating 20 years on the air in San Francisco, yet they too struggled at the beginning. The station barely survived its first two years due to weak audience numbers and lack of advertising support. Station personnel were recently heard on air discussing the reality that KFOG would not succeed as a start-up today. Fortunately, the original owners correctly believed time would work to their benefit.

Streamline Publishing, the company I own, launched the fine art magazine Fine Art Connoisseur about four years ago. Many companies would have killed it for non-performance in the first two years, but in that market advertisers and readers need time to develop trust. Time and consistency have been key factors, and we are now enjoying our highest-billing issues ever.

TIME
The lack of time allotted to develop listener and advertiser trust is a major detriment to the radio industry. Similarly, in a recent editorial I noted that some of the best radio salespeople I've known would never have made the 90-day cut if they were starting in radio today. The same holds true for managers and program directors as well. And few radio stations or formats that have enjoyed long-term success were built in a year. Yes, there are instant successes such as the Adult Hits (Jack, Bob, Ben) format, but its long-term viability remains to be seen.

Though I can appreciate the need for public companies to satisfy Wall Street, if the Street had been breathing down my neck during either Radio Ink or Fine Art Connoisseur's earliest days, I would not have been afforded the time to nurture an up-and-coming heritage brand.

I have turned down every offer to head a public company because I don't want to be punished after every quarter when I cannot answer the question "What have you done for me lately?" to the satisfaction of the market.

Maybe radio isn't cut out to be public. The tide certainly seems to be shifting away from it. Regardless, radio simply must do a better job of communicating to its critics that some things done well take time. Patience and time are the best ways to build customer loyalty and trust; and once you have them, they're difficult to lose.

Are Your Salespeople Feeling The Love?

"Actions speak louder than words," says my wife, Laurie. "You can tell me you love me all day long, but when you show me by your actions, I know you really do love me." With family, showing your love starts with devoting time. It's true in business, too. Do you show your salespeople that you love them?

Somewhere along the line, we got the idea that salespeople are expendable -- that if they don't perform quickly, or if they slip below budget, they should be terminated. Meanwhile, everybody complains about how hard it is to hire and retain great people.

The radio-sales meat grinder goes something like this: Hire them, hand them a training book or tape, put them on the streets, and give them 90 days to sink or swim. Most sink.

First we have to look at the level of people we bring in. If you pay peanuts, you get monkeys. In theory, higher-grade people -- who cost more -- will perform better and return your investment sooner.

Then, we should consider the person's selling style. One of my salespeople closed very few sales in his first six months. But we saw that he was relationship-driven, so we didn't fire him. Within the first year, he'd brought in more business than we could ever have expected -- and 20 years later, he's still with us. Had I fired him in those first 90 days, I would have lost one of the best people I have ever worked with. If selling is indeed about relationships, how many great relationships can be built in 90 days?

WHAT YOU OWE SELLERS
If you hire me as a seller, you owe it to yourself to help me be successful. You owe me opportunity, training, a job description, and a product to sell.

Most stations don't have job descriptions for salespeople. One manager told me: "Of course we do. Their job is to sell. Period." No! A salesperson's job is multi-faceted: building relationships, prospecting, delivering the station value proposition, maintaining the station's image to the clients, servicing business, managing the creative development of commercials, and closing deals.

"I cannot invest in training until they prove themselves," one manager told me "That guy was a terrible seller. I'm so glad I didn't waste any money training him." That manager should be taken out behind the station and shot for stupidity. Does an airline pilot receive training only after he makes it from San Francisco to New York?

Before you fire salespeople for non-performance, ask yourself: Did I provide them with the tools they need? Did they have a job description? Did they follow it? Is the failure their fault?

Also, think about this: How much time do you spend with your salespeople? Your radio station's success relies on a handful of people, but they often receive minimal time from management. Managers and sales managers are loaded with shuffling paperwork, watching inventory, and dealing with clients and other departments. One consultant told me he secretly tracks the time that he sees the sales manager spending with sellers. The average per day for all sellers is 42 minutes.

If you have a sales problem, ask yourself: I am showing them the love? Am I giving my time, attention, training, and respect? Am I beating on them, hoping they will do better, when they don't know how to do better? Am I pushing good people out because they're taking too long to succeed?

Of course, we have to push for results, and at some point we have to end our relationship with non-performing people. But first we owe it to them, and to our success, to make sure we have shown them the love with our actions, not just our words.