Ink Tank

Loss Of Trust: How Citadel Media Just Raped Radio

A message from Radio Ink Publisher Eric Rhoads

Before I begin: In the interest of full disclosure, Citadel Media (formerly ABC Radio Networks) is an advertiser of Radio Ink.

Imagine, if you will, that your local radio station has spent 15 years and loads of money establishing a local personality. We all know that the personal connection to the talent on our radio stations is one of the most important assets we have. Radio's value is not its signal or its tower. The value comes from the relationship we have with our listeners.

Our Worst Nightmare
When I was a programming consultant, our worst nightmare was having to find a way to take audience away from a heritage air talent who had a lifetime relationship with the listeners. We knew that if we could get that talent to jump ship, there was often more loyalty to the talent than to the radio station itself. If we could take the two or three most established personalities and move them to our station, we could have a much more successful start -up and destroy a competitor. If we couldn't get them to come to us, we would look for ways to get them hired out of the market. That's how important a strong local talent can be.

Sounding Local
Today, thousands of radio stations around the country rely on radio network feeds of formats and talent. The big sell is that you cannot afford to hire personalities this good in most small towns. Technology has become so flawless that local listeners most of the time don't know that a talent is voicetracked or coming from a satellite network. The ability to sound local has improved significantly. Therefore, to the local listeners, the talent they are hearing is local talent.

Sleight of Hand
Last night we received a press release about how Citadel Media had shifted some talent around. What the spin didn't indicate is that these changes were because of a bloodbath of network talent firings. Today my phone has been ringing off the hook from affiliates who are either immediately canceling their Citadel contracts or talking to alternative providers with the intent of canceling. Why? As one local manager I spoke with said, "Our stations success has been built around two air personalities who have been on our air for 15 years. Suddenly, they have been replaced. Our listeners don't know these are satellite guys. They are local as far as they are concerned."

Destroying Hundreds of Stations
Imagine the impact of this decision, which was economically driven. This casual decision to remove some high-priced talent on several formats is disrupting the competitive advantage on hundreds of radio stations in one fell swoop. One format alone may have several hundred stations that had built their entire businesses around those personalities over decades. Their competitors are popping open the champagne because the toughest talent to beat just got replaced by people who don't have a bond with listeners. Of course, doing this across several formats could destroy (yes, destroy) the businesses of hundreds and perhaps thousands of radio stations. All to save a little money on highly paid talent.

Self-Destruction
This cost-saving move, which corporate executives may see as harmless, could result in loss of ALL of their format affiliates. Citadel Media's competitors are on the phone today with every affiliate. In fact, while I was talking to one manager today, he received a call from Dial Global.

Killing Trust
Look, I would not want the debt, the pressure, the bankruptcy Citadel may be facing soon. And I too would be looking to save as much money as possible. I wouldn't want to be in their shoes (though I'll be one step closer when they cancel their advertising because of this missive). But don't make material changes that kill the trust of your customers.

If you want to do it at your own radio stations and risk losing audience and revenue, so be it. But today millions of radio listeners woke up to new talent, wondering where the people who have been their friends for decades have gone. Radio owners across America just lost their heritage brands, and that has to severely impact their business. Advertisers have talent loyalties too, and this move could kill these affiliates.

How Dare You?
Where is Citadel Media's loyalty to its affiliates? Without them, they have no business. How can affiliates trust Citadel Media now, when they've raped the airwaves in hundreds of markets that built their business on the heritage brands and air talent? Farid, how dare you treat your customers like this?

Broken Eggs
Corporate responsibility must go beyond financial responsibility to shareholders. Thousands of affiliate radio stations had all their eggs in the Citadel Media basket, and those eggs were broken over a decision to make the next quarter look a little better. The ironic thing is that this move will worsen shareholder value because of affiliates jumping ship, knowing they can never trust the company again.

Undo This Decision
If Farid Suleman were savvy, he'd call all those fired talent back, apologize to his affiliates, tell them this was a terrible error in judgment and that he did not realize the negative impact to his affiliates. This, and only this, will save his format business and might prevent a class action lawsuit.

Revenue Lost
I don't make a habit of cutting my own throat. I know I'll never see another advertising dime from Citadel Media. I know Farid will probably decide not to make his annual appearance on the group heads' panel at our Forecast conference. I don't care. I'm livid, and someone has to speak up and defend these radio stations, even at the expense of losing a substantial advertiser.

Hundreds of radio stations may be destroyed over this, millions of dollars in advertising may be lost, entire businesses may be destroyed because of this decision, which could impact the incomes of hundreds or thousands of radio station owners. This decision was simply irresponsible.

Best,
Eric Rhoads
Radio Ink

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A Message from Deborah Parenti, VP/General Manager of Radio Ink:

Important Independent Broadcasters Panel to Be Held at Forecast
If you own a small or independent radio station, we invite you to join us at Radio Ink Forecast, less than four weeks from now in New York. The panel, Independent and Optimistic: How Small Radio Companies Succeed, sponsored by Arbitron, will discuss the secrets of successful independent operation in today's media and economic worlds. A panel of leading independent owners will discuss what it takes to keep revenues pumped and cash flowing at their stations and how their ability to act -- and react -- nimbly works to their advantage. What are their plans and strategies heading into 2010? Find out as leadership, independent-style, addresses the issues facing all broadcasters.
Moderator: Bill Stakelin, President/CEO, Regent Communications
George Laughlin, President, GAP Broadcasting
Steve Newberry, President/CEO, Commonwealth Broadcasting
Gary Rozynek, President/CEO, Maverick Media

To register, call 561-655-8778, or register online at www.radioink.com/forecastsummit
Attendance is limited to 200 people. Please book your seat early.

The Sky Is Not Falling ... Everywhere

A message from Radio Ink Publisher Eric Rhoads

 

OK, I'm guilty. From time to time I've made blanket statements that could make a reader think the sky is falling in radio. Though, frankly, I've also highlighted many a success story in my editorials, and not everyone in radio is faltering.

For instance, I received this e-mail moments ago. I have removed the name and market at the request of the sender:

Good morning, Eric.

I continually read, almost on a daily basis, the shortfalls that most radio companies are experiencing. Cumulus, Entercom, Beasley, etc. Not all radio stations experienced down third quarters or are having down years. In 2008, my four local sales representatives did more business than 2007. The only shortfall was national, and that was due to massive budget cuts.

Our single, standalone FM in [city removed] delivered a third-quarter increase of 5 percent. 2009's August was the best August in the 40-year history of the station. September was up 12 percent, and October was up 12 percent. November will be up also. Our 2009 fiscal year will be up over last year. We have five cluster operators to sell against. I do not know if [city removed] is an exception to the rule, but I do know that seven car dealers went under this year and numerous retailers and major chains closed stores, including a major employer that closed and put 400 people out of work.

Anyway, I'd better get to my point. Buyers also read this news. As you know, most buyers are very opportunistic and expect rate reductions, assuming all radio stations are suffering. I am constantly battling buyers, local and national, explaining that not all markets and stations are experiencing 15 percent to 20 percent shortfalls.

Many times this has been greeted positively. I want them to realize that the investment they are making in the radio station is in the best interest of the client and is very important to the station. I think they also enjoy talking to someone who doesn't sound like they are getting ready to jump off a bridge. I am sure buyers have heard sellers beg them to buy their stations.

Thank you for listening.
 
I'm sharing this letter for a number of reasons:

1) I hear from radio stations every day that are making it through this recession and growing their business. Most, but not all, are in smaller markets where they have never been completely reliant on national business. Most adhere to the principle of strong community involvement, which seems to act as an insurance policy when times get tough.

2) I know that several hundred advertising executives using radio and several hundred clients are part of our 600,000 monthly readership. Though I think it's critical to always tell the truth and never sugar-coat anything for their benefit or for the benefit of the industry, I think it's also important to make sure we're not only spewing the negatives for the sake of drawing attention. There are many successes worth talking about.

3) Sure, radio is changing and evolving, and radio operators need to adapt to the new digital environment or suffer the consequences. Many are, but many others resist. But radio isn't going to die just because some think the only future option is streaming or podcasting. We must not forget that most Americans listen to the radio every week, including young people. It's easy to be seduced by what's new, what we love. I'm Mr. Gadget. I buy every new gadget the day it comes out. But radio is so ubiquitous and has such a deep listener bond that it is not easily replaced. (But let's never get arrogant or overconfident.)

4) I don't want cheerleaders with empty promises, and neither do you. Still, you don't want me or anyone else telling you how ugly radio is every day. Enough already. This is a great industry, one that I'm proud of. Sure, there are problems. Yes, we need to address them. Yes, we can find isolated instances with almost any company and make things out to be bad all over, but it's simply not true. Negativity sells, but, just like we don't need overly optimistic voices, we don't need overly negative ones. People love bad news, but it's not good for our industry to always focus on the negatives. Let's not spread the negativity and keep your mind away from negativity.

Radio can't create more jobs in every town, and it can't solve the world's problems. But one thing it can do is play an important role in our individual communities. We can help businesses sell products, and that helps our communities. We can look for positives to share. Not empty cheerleading, but honest, upbeat news in our communities should be celebrated by radio stations that have the ears of those communities.

This letter helped me see my responsibility. I hope this helps you see yours.

Best,
Eric Rhoads
Radio Ink

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Great Sales Teams Require Great Coaches

Although our salespeople are encountering reduced or nonexistent spending accounts, we as managers cannot accept lower performance. But beating on our sellers for better performance can have an adverse effect on their motivation. Is there a solution?

Like great athletes, most great salespeople are highly competitive. And, similar to athletes, a strong coach can play a role in inspiring salespeople to success. Here is my list of the attributes of a great coach.

1. Great coaches see things in their people that others don’t see and work to pull those qualities out.
2. Great coaches contribute the time, patience, and continual reassurance to develop these attributes.
3. Great coaches communicate effectively. They know how to send the right message in the right way at the right time. They set clear, measurable goals and expectations. They react swiftly — and fairly — when correction is required. They continuously monitor progress and provide corrective actions and ideas.
4. Great coaches adapt their coaching style for each individual’s learning style and needs. It might entail a gentle nudge, a push, encouragement, appropriate scolding, disappointment, or a challenge. They pull the best out of each individual.
5. Great coaches know that one size does not fit all when it comes to incentives. One is motivated by recognition, another by money, another by a dream or wish.
6. Great coaches know their team members’ limits, strengths, and weaknesses. They do not set their players up to fail. They know when to intervene, or when to lend a sympathetic ear. They create a success plan for each team member’s growth.
7. Great coaches are mentors offering experience, perspective, and advice. They are not know-it-alls. They are willing to listen. They lead by example and make people want to emulate their behavior. They inspire confidence and trust.
8. Great coaches foster dreams, hopes, and vision. They help their players picture a better future and continually correct the course with that vision in mind.
9. Great coaches have a sincere desire to help each person grow and achieve their goals. They help players stretch to reach the impossible.
10. Great coaches do not lead by fear and rarely lash out — so when the do, they are taken seriously. They are trusted partners in the success process. They are empathetic, but not sympathetic. They set firm boundaries.
11. Great coaches understand that failure of the athlete is failure of the coach. They are a friend, teacher, and guardian. They stand up for their people and they do not push corporate pressure downward. Instead, they absorb it, while understanding that negative pressure locks up some team members. They demonstrate personal character and don’t ask you to do what they are unwilling to do.
12. Great coaches are realists who are willing to face reality. They are not falsely positive. They listen carefully and seek outside ideas and perspectives.
13. Great coaches do not over-manage. They let people make mistakes and grow from them. They are not hung up on titles or formality.
14. Great coaches see change as opportunity.
15. Great coaches put values and ethics above everything else.
16. Great coaches cultivate leadership and make it fun. They know that a happy team yields higher results.