"I just knew it," said my buddy, who runs a medium-market cluster in the West. "I knew this whole digital thing was a house of cards that was about to collapse. Now it's coming true. It won't be long before people will be returning to radio, TV, and print, because they work better than digital." He was referring to an article in the Wall Street Journal headlined "The Big Doubt Over Facebook," questioning the valuation of Facebook and its effectiveness as an advertising medium.
From my perspective, nothing in that article indicates that a "digital house of cards" is falling. Though it mentions a couple of advertisers like KIA, who are questioning Facebook's effectiveness, the Journal also highlights Ford Motor Co., which spends 20 percent of its media budget on Facebook and directly attributes a 104 percent increase in sales to the site. The story also mentions that WPP Group, the largest advertising agency in the world, is increasing its spending on Facebook to $400 million for Unilever and Procter & Gamble. Though my friend interpreted the article as an indication that digital media is crashing, I read it as indicating even greater success for digital is ahead.
We tend to filter information to support our hopes. My friend and I drew two different conclusions from reading the same article. My friend, like many of my colleagues in the radio industry, believes digital is a passing fad and that one day advertisers will come to their senses, realize that digital doesn't work, and return to traditional media like radio. What do you believe?
The Broadcaster's Dilemma
Most managers and owners are so focused on meeting revenue budgets that digital isn't on their radar. Some don't believe there is much, if any, income in digital, so it's not really worth the effort. So why bother? Why invest time? Why invest resources? Why not just wait and see what happens and jump on it once it's proven out? The fact is, there are stations in all sized markets that are experiencing significant digital success -- some are even seeing digital bring in 20 percent-30 percent of total revenues.
Is Radio Treating Digital Like FM?
If you were around in the '60s, '70s, and '80s, you may recall stations abandoning their FMs because they thought it was a waste of money to run the transmitter. Most believed that if FM eventually became successful, they could always buy FM stations later. Very few believed that FM listening would ever exceed AM listening.
Then, in the mid-'80s, FM listening began to overtake AM in several markets. But even then, many owners and managers were still in denial. By the time they came around to believing, FM properties had become scarce and prices were soaring. History is repeating itself. If you play a wait-and-see game, you're likely to lose opportunity and allow others to become established.
Perception Is Reality
Members of the first digital generation are now controlling more local, national, and advertising businesses. The head of advertising for a major car company (confidential) tells me that over 50 percent of their local dealers have turned the business over to their kids. He claims the new generation want to make their own mark and no longer want to use traditional media.
Agencies report that clients are requiring all media buys to have digital components. Though the reality may be that traditional media continues to be very effective, the perception from this new generation is that digital media is better. Those trying to change their minds are looked on as being stuck in the past.
Information Is Power
You and I both believe in radio. We both believe radio audiences have remained strong. Yet successful businesses must mirror the needs of their advertisers. Radio will thrive if it responds with the digital initiatives advertisers demand. Yet too many radio managers are ignoring digital requests -- or not even seeing them, because advertisers are buying digital alternatives not measured by ad-monitoring services.
The media business has changed, and your survival depends on your deep grasp of the new digital realities. Reading a couple of articles a week at Tech Crunch won't make any of us digital experts. If you're going to compete, you need a comprehensive understanding.
An agency executive recently told me he was pitched by the manager of a major-market cluster. When asked what digital initiatives the station could offer in addition to a radio schedule, the manager started talking about banner ads. The executive said, "I just shook my head, thinking this guy doesn't have a clue how far behind he is, and I wasn't about to take the time to educate him. I just stopped returning his calls. This manager thought he was digitally savvy, but he didn't know how far behind he had fallen."
My biggest fear is being irrelevant -- being clueless, not knowing what I don't know. In just a few weeks, you have a chance to make sure you're not clueless. Because Radio Ink's Convergence is designed specifically to help the radio industry get up to speed on important digital trends and learn about income opportunities we can put into action immediately. It's held in Silicon Valley to help us attract great brains who will open your eyes to things you need to understand.
You may not know their names, but after hearing them speak, you'll be blown away by what you've learned. You can try to learn about digital on your own, but at Convergence, you'll be immersed for a couple of days, away from your busy environment. Consider it a crash course in generating digital income for your stations. It's not a bunch of futuristic theory, it's meat and potatoes for today.
After each Convergence, we hear attendees say, "I wish my team had been able to hear this," or, "I wish my boss was here too, so he could understand what we need to do." It's too hard to explain two days of intense data after the fact. Last year one person told me, "I brought my manager this year because I couldn't get her to sign off on the things I wanted to do, since she didn't understand them. Since I got her to come to Convergence, she can grasp what we're saying, and we've implemented some innovative and money-making programs. This conference opened her eyes."
If you delegate attendance and have others report back, you'll hear a couple of highlights, but not the important information behind the concepts. Leaders need to understand nuances and what is possible to provide directional leadership and vision. By having your entire team together, you can build a strong strategy. We highly recommend the core team of the manager, sales manager, program director, and digital director attend Convergence, and we've built a special team package to allow you to attend cost-effectively.
Limited To 600 Seats
Convergence continues to grow, and continues to sell out. If you've never attended, you should know we offer a 100 percent satisfaction guarantee. We believe every radio management team will benefit from attending together, and we've returned to the Santa Clara Convention Center so we can accommodate your entire team.
You'll find Convergence is different from other radio conferences -- we're not rehashing the same old tired concepts, we're bringing in outsiders to help you see possibilities, and we'll stay focused on action items you can immediately put to work.
It's time to jump in, understand where things have gone, and make sure your station gets a piece of it. Now is the time for you to attend Convergence. It's not only about keeping your stations relevant and generating new income, it's about staying personally relevant by investing in your career. You cannot be in media today without a clear understanding of the digital world. Register today. (For team rates, phone us at 561-655- 8778).
PS: I've very pro-radio, but we could still go the way of newspapers. Most newspapers failed to embrace the Internet and refused to admit how much it was eroding their audience. We could be in the same boat if we're not attentive to these issues. Your revenue increases will come from the digital initiatives you need to master. We hope you'll join us.
Convergence is set for June 4-5 at the beautiful Santa Clara Convention Center in Silicon Valley, and it's packed with speakers and panels that will give you the real, practical help and information you need for success in the digital era. Click here to see the agenda so far -- and there are lots of additions and updates to come.
Click here to register for Convergence online, or call 561-655-8778.