INK TANK

Scientists Test and Refine “Theater of the Mind”

 

We radio people love to talk about “Theater of the Mind.”

Any of us can give you examples of it.

Some of us can even create it.

But none of us has ever been able to explain — step by step — exactly how to do it, and then back that explanation up with published clinical studies using evidence-based scientific process.

Until now.

Jeff Sexton, one of the partners of the Wizard of Ads, followed Roy H. Williams out of Nashville’s Ryman Auditorium on Monday, August 21, the day of Nashville's total eclipse, and fell into step beside him.

Jeff said, “I can tell from what you’ve been writing lately in the Monday Morning Memo that you’re following the same trail of research I’m following.”

Roy smiled and said, “Doesn’t surprise me at all. That’s why we call you The Professor.”

“That stuff about paratextual confidence is pretty mind-blowing, isn’t it?”

“Para-what?”

As Jeff began to explain, Roy realized that his partner had been following an entirely different group of cognitive neuroscientists on an altogether different trail.

What Jeff Sexton shared with Roy Williams during the next 20 minutes will soon be major news for advertising professionals around the world.

Radio ad writers, in particular.

Join Jeff Sexton, Roy H. Williams, and Eric Rhoads for the historic unveiling of this scientifically tested and proven method for creating Theater of the Mind, employing specific techniques to transport listeners into an alternate reality, resulting in significantly increased levels of listener trust in your advertiser.

Sexton will speak during the opening hour of Radio Ink’s Pre-Radio Show Event on September 5, 2017, in the Tower at Wizard Academy, Austin, Texas.

This is going to be like Woodstock. Thousands of people are going to claim they were there when this game-changing information was revealed, when in reality it was only 30 people.

Very few seats remain. And we’ll be taking a photo of who was really there.

Click here to register now, and use the discount code radioink for $500 off the full event price.

Eric Rhoads
Chairman, Radio Ink

 

Go Big Or...?

It is time for the radio industry to go big and do the unprecedented.

The number one metric radio has been touting is its huge reach. But for the most part this figure has fallen on deaf ears at the country’s major ad spenders.

Advertisers like to generate reach quickly. They are enamored with reach velocity, which is why they are willing to pay a premium for network TV, major sporting events, and awards shows.

Reaching potential customers immediately is considerably more appealing to most major national advertisers than building the same amount of reach over a three-week campaign.

The Chicago broadcasters “get it,” and have illustrated the power of radio and its ability to generate instant reach with the roadblock broadcast of a client touting the power of radio. And before that, 47 radio stations, also in Chicago, broadcast a 30-minute conversation with the city's mayor.

Let’s take it up a notch and get all radio broadcasters throughout the country to band together to synchronize their clocks and make available to national advertisers a TDB number of roadblocked commercials each week. The reach (19 million-plus) generated would rival top-rated TV shows and would be DVR-proof while opening up a new revenue stream for the medium.

Katz or the RAB could approach any number of national advertisers — the automotives, which are constantly debuting new or updated models; the studios that are touting the next blockbuster; or any other national advertiser who is promoting a time-sensitive, call-to-action sale or event.

Offering these advertisers this type of mass-reach option would likely be an appealing marketing proposition.

I understand that this might not be as simple as it sounds for a number of reasons — the first one being syndicated shows — but it is worth investigating with a “How can we?” mindset.

Bold moves are required to reinvigorate the industry’s revenue outlook. This tactic could be one of them.

It might make sense to begin this conversation at the upcoming Radio Show. I'll be there. Let's talk.

PS: If you're going to the Radio Show, Roy Williams and I will be revealing some new concepts for radio at a special pre-convention one-day event at the Wizard Academy on Tuesday Sept. 5. It's only open to 30 people and promises to rock radio's world. You can learn more here.

 

 

 

Are You Radio’s Next Messiah?

Kent Burkhart, Todd Storz the father of top 40 radio and legendary programmer Bill Stewart

 

 

 

 

 

 

 

 

 

 

 

 

 

This is an industry littered with programming stories, but few have had the impact of Top 40, and it has been the basis of the music part of the radio industry for decades now.

 Todd Storz was taking a giant chance with his father’s radio station. He could have killed the golden goose that paid for his college tuition. Instead the move bolstered Storz Broadcasting.

 It took creative courage to do what Storz did. His audience could have tuned out. His advertisers could have abandoned him and moved across the dial. There was a lot at stake.

Todd Storz moved out of his comfort zone and took a risk that changed an entire industry. Rebels like Gordon McLendon, Bill Drake, and Don Burden followed with their own unique brands of genius. In the ’70s, Lee Abrams and Kent Burkhart took a leap with a format of alternative album cuts. Jerry Clifton created mainstream Urban stations, blending the best of Top 40 and black radio. Walter Sabo put Talk radio on FM.

Risk takers don’t always get great rewards. There are many who have failed and been forgotten. But those who don’t take risks don’t change an industry.

Comfort and consistent cash flow are wonderful things, and moving out of the comfort zone of security takes guts. As a young man, I recall John Dille shifting his number one elevator music station in my hometown, WMEF, to an FM Rock station on the bet that it would do better. It did. I thought it was pretty gutsy.

Safe is understandable, which is why we’ve fallen into the rut of safely researched hits and doing the same thing we’ve done for the last four decades. In some cases we’re still using the same liners and Star Wars sound effects from 40 years ago.

Why stick your neck out? What if you fail? What if you take a risk, it fails, and your career suddenly ends? What if you’re the laughingstock of the industry? You don’t have to risk it. You can remain safe and secure. Nothing wrong with that.

But what if you have a burning desire to make waves because your gut tells you it will make a huge difference? What if you don’t want to be the person who plays it safe their entire career, only to look back wishing you had taken more chances?

When I entered radio, I was surrounded by radicals and change agents. Most of those people are still in the business, but too many have, sadly, become comfortable. Our industry has become a little too stable, a little too much the same, a little boring.

Stability in media is vulnerability.

When big dollars are funding big online plays and other technology designed to steal your audiences, it might be a good idea to do what they cannot do. It’s better to try something entirely radical with your audience and keep them than wait until they leave you and then have to try something radical in the hope of getting them back.

Launch your rocket. Change the world. Or go down in flames trying. It’s better to know you tried and failed than not to have tried at all.

Radio needs another Todd Storz. Is it you?

Radio: Disrupt Or Be Disrupted

The world as we know it has been disrupted. Look at almost any industry, especially in technology, and you’ll see that new players have come into the space, offered the product or service in a new way, and left the old-school ways of doing things in the dust. Anything that can be digitized can be disrupted. Why, then, do we think radio can’t be disrupted?

Innovator and X Prize creator Peter Diamandis says that everything will be disrupted — and that either that will come from those who are willing to disrupt their own industry, or it will come from outsiders. Typically, insiders won’t disrupt because they are so enamored of the way they do things that they can’t see the benefits of disruption.

Kodak is the perfect example. In 1975, Kodak invented an early digital camera. Yet executives in the company said it was a toy no one would take seriously. They considered themselves in the chemical and paper business, and believed people would always want prints and film. In 2013, Kodak went bankrupt. Though it has emerged, it’s not the company it once was.

Why, if every industry in the world is subject to disruption, do we in radio think we’re immune?

Why do we think our bond and relationship with listeners will last forever?

Why do we think the AM or FM band is always going to be our primary means of delivery?

Why do we think that music licensing and streaming fees are a barrier to entry that will protect radio forever?

Why do we think audiences will always want radio content the same way we have always delivered it?

If you follow the patterns of disruption, there is an early stage where potentially disruptive technology is present but hasn’t seemed to catch on. That period can last for years. Then someone builds something brilliant on top of that tech, and it takes off. The government invented the Internet, but it took 22-year-old Marc Andreessen to create the Mosaic Web browser, a tool that made it usable for all. Even then, it took years for the Internet to achieve massive scale. But then it seemed everything had changed overnight.

Everyone explained why Amazon could not succeed, including its lack of profitability and high costs of infrastructure. Though it took a decade, Amazon ultimately became the standard and disrupted the book business, the video rental business, the retail business (it’s the largest retailer on earth, much larger than Walmart), the data storage business, and probably many other industries.

I have love and passion for this business we call radio, and I believe the root of entertainment, information, community, and talk or music are key elements that it will never lose. But I’m not convinced we won’t be disrupted. People are pleased that Pandora and Spotify are not as strong as they were once perceived to be, but that doesn’t mean very much, and it’s not something to be celebrated. Both have nonetheless disrupted how consumers use audio — and more disruption will occur.

I don’t think the question is whether disruption will occur, only how and where the disruption will come from. Chances are it’s out there and in the works now. And if not, it’s about to be.

So if radio is to be disrupted, shouldn’t we, the people in the industry, be responsible for disrupting ourselves? It seems to me we should be. And why shouldn’t that disruption come from you?

Here is what I think will be disrupted in the near future:

• How advertisers buy audio. Is programmatic that disruption? Probably.
• How local advertisers buy radio and audio. Will programmatic come at a local level? Probably.
• I also think someone smart will figure out how to eliminate the local sales system. Other industries have figured out how. Why not radio? Any process can be automated up to a point. Though sellers are critically important, and may always play a role, that role will change.
• How listeners use radio. When all of us are riding in self-driving cars in the near future and we don’t have to keep our eyes on the road, the car will be a transportable office or living room, used for working, watching video, being on the phone. Radio’s role in the car will change.
• How listeners engage with audio. Perhaps it will still be Spotify or Pandora, but perhaps those were stepping stones to a new method not yet invented. Maybe it’s the NextMedia radio app on the phone (it can’t hurt), but I suspect it will look a lot different from anything anyone is doing at the moment.
• Radio programming will change dramatically because of big data and the ability to know exactly what a listener is doing and matching their activity, their location, or their mood. Sensor devices could let you know when listeners are jogging, resting, working, etc., and you’ll know exactly which songs they love and reject, and what they have listened to in the past during those activities so you can match it exactly. More and more, programming will be delivered one-to-one.
• Radio ads will follow the same track, and the listener will be fed ads based on their activity, their physical location, and their online activity. If you were looking for black pants and didn’t buy any, an ad will tell you they are just around the corner and that you need them for your date tomorrow night. Or you’ll be nudged when you’re driving near an oil change shop and your in-car sensors tell you it’s time for a change and your calendar shows you have the time. Ads will be giant robotic networks. And that, of course, will change what you’re selling and how.

In spite of how much I love new technology and how much I love the idea of disruption, I don’t like being the guy delivering the news that our world probably will change. If others disrupt us then we lose control and lose revenue opportunities. If, on the other hand, we disrupt ourselves, we have an insurance policy of sorts on our revenue.

It’s natural to think that all of this is out of our control, that it’s the job of our companies or our bosses to figure it out. But they may be too close to it, and you may be the person who has the idea that will disrupt this industry. All it takes is a great idea — a unique thought, and the persistence to find people to help you execute it. I, for one, hope to hear your ideas.

Radio plays an important role in people’s lives, but so did telegrams, photo processing shops, travel agents, and retail stores. Though it’s hard to have one foot in the old way of doing things and one foot in the next, it’s better you than someone from the outside.

A Quick 18 Years

If you were to awaken me from a deep sleep and ask me how old HD Radio is, I’d probably say 5 to 7 years. So I was shocked when Bob Struble announced he would no longer be with the company he founded — 18 years ago. That was a quick 18 years.

It’s no secret that when companies acquire companies, it’s usually a honeymoon of a year or less before the CEO at the purchased company goes. Bob Struble and I discussed it as he received his “40 Most Powerful People in Radio” plaque at our Forecast conference. I mentioned that it might happen, and of course he said he knew it could, but he was willing to hang in there if the new ownership wanted him to. But like most companies needing to make an acquisition pay off, the buyers decided to go in another direction.

Frankly, it’s an expected move and won’t damage Struble a bit. He did, after all, sell the company he founded, and hopefully will be able to reap the rewards for a long time to come as he decide his next steps in life.

Over the last 18 years, I’ve complained about HD Radio and I’ve praised HD Radio — there’s no need to restate all that now. But great credit is due to Struble for having the drive and vision to make digital radio in the U.S. a reality, with industry support and distribution through the automotive world. My new car's radio does not even have a button with the word radio, but there is a giant logo saying HD.

Bob went against great odds, fought criticism (much of it from me), and pulled off what seemed like an impossible task.

Though the jury is still out on HD Radio in many ways, Bob and the iBiquity team have done an amazing job with it. What I find magical is that we can do endless things on a digital dial that we can’t do in an analog environment. Artist and song information, album art and other graphics are only the tip of the iceberg. What I find exciting is the ability to distribute other content, to have a potential two-way dialogue with the radio, and to track listening data so terrestrial radio can compete with the data offered by digital audio online.

My hope is that Ibiquity’s new owners, DTS, will really take it to the next level of possibilities for the benefit of radio broadcasters. It’s hard to know exactly what excited them enough to buy Ibiquity, but clearly they see possibilities, and with their strong technical history and distribution, it seems only good things can come from this.

So, Bob Struble, thanks for almost two decades of hard work, great vision, and thanks for never giving up at times when it looked grim. You built a significant platform for radio, and your contributions will not soon be forgotten.

A Plan To Eliminate Radio's Advertiser Turnover Forever

 

Turnover among advertisers seems to be a disease within the radio industry. But what if we looked at advertisers differently? Could we stop the turnover?

First, we have to address the causes of turnover. I think it boils down to a few things:

 

1. Clients are sold high expectations, then let down when those expectations are not met.
2. Salespeople are so eager to make a sale that they will accept schedules that cannot possibly work.
3. Clients (and salespeople) don’t understand what works on radio, so the creative is often ineffective.
4. Our industry has high sales turnover. Clients just get tired of hearing from yet another new rep.
5. Clients don’t understand the value of dominating a single audience and therefore jump ship to other stations when their ads don’t seem to work. They don’t give ads enough time.
6. Clients succumb to high-pressure techniques but then swear they’ll never advertise with that salesperson again once the agreement ends.

 

The harsh reality is that most of these problems are caused by radio people. Because we are under enormous pressure to meet budgets (understandable), salespeople have less time to develop client relationships and to properly educate advertisers about what works and what does not. (And frankly, there are lots of reps and managers who don’t even have those answers themselves.)

 

Uneducated advertisers are our fault. We have to take the time to develop them, help them understand why repetition over time is necessary, how to build top-of-mind awareness, and how to run campaigns vs. running spots. We need to be willing to say no when we know a schedule won’t work. That’s hard, with so much budget pressure. Yet when ads don’t work, the advertiser blames radio and the station. And if we place the blame on them after the fact, we look like cowards. These are conversations to be had up front.

 

But beyond these issues, there is a factor I’ve never seen used in radio. It’s called “lifetime value.”

 

Last week I met with a radio group head and asked what the lifetime value of a small advertiser was. She paused, then said, “I’ve never stopped to think about that.” She then guessed a small advertiser on her stations was probably worth a million dollars.

 

The light immediately went on.

 

What if rather than looking at a small advertiser as an annoyance, you looked at them as a million-dollar customer? How would you treat them differently? What would you spend to acquire them and keep them?

 

I own a direct marketing business, and one thing those of us in direct marketing are willing to do is spend as much money as possible to acquire a quality customer, because we understand their lifetime value. If I spend $1,000 to acquire a customer, it seems high — unless, of course, you realize that customer over the next 10 years may spend a million dollars with me. Suddenly it doesn’t seem like a lot of money, as long as I’m finding the right customer. (That is a different discussion for another time).

 

In the direct marketing world, we also know our stats exactly. We can tell you how long the average customer stays and the exact time most will want to wind up their original contract. What if you calculated that? The data is certainly there.

For instance, in a membership program, a direct marketing company knows that someone paying $50 a month for a service will typically back out in month seven. Since they know that, they can work to prevent it: In month five, they’ll activate a client-retention program. Sending a little unexpected gift or reminding the customer of all the value he or she is getting — by providing even more value — will stop most cancellations.

 

What would the value to you be of a plan to stop advertisers from backing out or being taken away by others?

 

Another big issue in direct marketing is buyer’s remorse, and cancellation in the first or second month. That’s why most marketers send a box of gifts to thank customers for their business. People tend to be less likely to cancel after they get your welcome package.

 

What if your station treated customers like direct marketers do: creating a truly wonderful welcome package, building a retention program, and being willing to invest to bring in the right customers?

 

Recently a hotel pitching us for our convention business went all-out during a visit. They sent a limousine for us, they had our logo projected on the wall, they had a cake with our logo imprinted on it, and they had people placed around the property in costumes related to the event we were proposing. The same day we visited two other properties, but they did nothing like that. That first hotel stood out, and they are the one we want to do business with. They made the extra effort, and were willing to spend to get our business.

If you look at every radio advertiser as a gift, and one you need to invest in to keep, it will change how you sell, what you spend to attract the right people, and how you train your staff and your clients. And it will have a big impact on retention and turnover.

 

 

Dancing On Cumulus' Grave

As my plane landed in Atlanta for the Radio Show, I checked my e-mail and saw the breaking news from our own Radio Ink that Lew and John Dickey had been ousted from their positions at Cumulus, though Lew remains Vice Chairman.

 

Upon arrival at the Radio Show, I encountered many who had an almost jubilant spirit about them, happy to see the changes at the troubled company. Though clearly there were others not celebrating the change, I was surprised and a little taken aback that there were so many people "dancing on the graves" of these two men's careers in radio.

 

Though I've reached out to Lew Dickey, we've not yet talked and there are lots of rumors floating around — "inside baseball" about the politics on the Cumulus board, which seems to have arranged this during a recent two-week vacation by the CEO.

 

I'm sad to see the dancing, frankly, but not for the reasons you might think. Clearly, there are people who have issues with the management style of Lew and John, or perhaps some of the decisions they've made — though it appeared to me, as an outsider, that something had changed recently and the company was making some great progress and some great hires. It was hard not to be in favor of their bringing in people like Pierre Bouvard and Dennis Green.

 

No one wants to see their own company pulled from their control. I've been through it myself: I was CEO of a venture-funded company, and I was fired and a new CEO put in my place. Little did I know that the CEO was a specialist in bankruptcies; I later learned the investors were doing me a favor and saving me from the headache of bankrupting a company I had put my heart and soul into building. Could this be the case with incoming CEO Mary Berner, who seems to have some bankruptcy experience as part of her very impressive resume?

 

It's easy for some to celebrate the demise of someone they have gotten into the habit of demonizing, and many have demonized executives at radio's biggest companies for cost cuts, personnel cuts, and the removal of live and local programming in favor of automation. And of course, many in our industry want things to return to "the way they used to be" and have never much liked the way things have become. I can't blame them. I'm not a big fan of what a lot of radio has become either. Yet I'm not sure what I would do in if I were in the shoes of a CEO who is running an overleveraged radio company – a company with just with too much debt.

 

I'm also sensitive to the fact that these guys, like them or not, built that company to what it is from scratch. They moved at lightning speed to accumulate stations and had to deal with the difficult issues of merging cultures, developing systems, and finding a way to manage everything they had. When you stop and think about what they accomplished in such a short time, it is pretty amazing, especially the way they managed to financially maneuver the company to its current size.

 

Still, many in the industry were bothered by how some of the biggest properties in the world saw meteoric drops in revenue because top-tier managers and sellers were either pushed out or resigned, or because programming changes meant ratings took a nosedive. It's easy to be critical when some legendary properties appear to be being mismanaged.

 

Frankly, if I were Cumulus Chairman Jeff Marcus or a board member, I'd be asking myself if I was willing to hang with the status quo, especially as I saw a dismal fourth quarter on the horizon across all of radio. But it's easy to be an armchair quarterback.

 

What concerns me most about this "dancing on the graves" is that this event is a giant signal about the state of a big portion of our industry. It's a signal that a prepackaged bankruptcy for radio's second-biggest company may be on the horizon and that the investors will be taking a haircut to save the company. Shareholders have been running like scared rats, driving Cumulus' value down even further. Sadly, this will be all over the press, and they will be telling the story of a radio industry that consolidated, is overleveraged, and is seeing revenues falling. Some will go so far as to declare that radio is dead.

 

Of course, this move also may embolden others who are likely to be forced into bankruptcy as revenues slide to go ahead and make the decision. Even without that, all of radio will be painted with the same brush by the media and possibly by advertisers, even though most companies don't have the same kind of financial woes as Cumulus. What will this do to other radio companies on Wall Street? Will this send shareholders scrambling to get out of radio entirely?

 

My fear is that the falling of this big domino will have an effect across the rest of the industry. That alone is a good reason not to be dancing on any graves. Whether or not you're a fan of the Dickey brothers, and whether or not this was the right decision from the board, this may impact us all.

 

Because of the depth of Cumulus' markets, this story will have the attention of advertisers everywhere. Some will make it a story about Cumulus, others will make it a story about the radio business, and still others will talk about how radio has not kept up. This is a time when every team needs to be ready with answers, and a time when radio needs to be rallying behind new technologies like programmatic and digital — first, to show you're not living in the 1990s, but also because we as an industry will benefit from embracing these things and the new revenues they can bring.

 

Having been a CEO who lost his company, I can say it's not a fun experience. I don't wish it on anyone. Whether or not you were a fan of Lew or John, dancing on their graves, particularly in public, isn't really in radio's best interest. They did the best they knew how to do, and, like most who end up in this position, they took the money offered and bought the properties with the blessing of investors who believed they would walk away ahead of the game. It's become clear that radio, now a major consolidated player, might be better off with enough stations one CEO can control and manage, and no more.

 

Embracing Technology Starts With Consumer Pressure

An incredible thing is happening for radio. In July, AT&T agreed to allow FM chips to be activated in U.S. customers’ smartphones. Then, earlier this month, Paul Brenner of NextRadio created a video outside a T-Mobile store featuring a consumer telling T-Mobile CEO John Legere that she wants radio on her smartphone — something the mobile carrier was not offering. Brenner had the woman ask Legere to enable the FM chips so she could listen to radio on her phone, for all the reasons NextRadio is promoting: low battery consumption during continuous listening, no data charges for audio, and FM radio when cell networks are down.

 

The pressure worked. Legere, to his credit, saw the message and stepped up, saying on Twitter last week that he will have chips enabled on T-Mobile phones. (Most phones already have the chip in place and only need to have it activated by the carrier.)

 

In spite of all the arguments condemning radio as “old technology” and the belief among some that everyone is migrating to online, self-programmed stations, Nielsen data shows that radio continues its domination. Radio should do everything in its power to pressure wireless carriers to enable the chips.

 

Interestingly enough, tens of thousands of radio spots encouraging listeners to go to their carriers to demand FM didn’t create enough pressure to persuade T-Mobile. Yet one video outside of a store that spread on social media apparently did the trick.

 

What matters is that T-Mobile said yes. Now NextRadio needs Verizon.

 

If radio stations in every city in the United States started having their morning teams create videos outside Verizon stores, would Verizon be persuaded?

What if stations staged promotions on the streets asking listeners to carry signs asking for FM on their phones, getting that on video — along with the station logos — and getting local media coverage?

 

Radio is the best at on-the-street promotions, and if we can get all the phone carriers to enable FM chips, it will be a major step toward getting radio on every device.

 

The smartphone is like a Swiss army knife: It has just about every device you might need. But it could have a working FM radio, and it doesn’t. Why not tout this to your listeners?

 

Let’s start with Verizon: Remember, most phones already have FM chips. They simply need to be activated.

 

We want to see your promotions and videos. Post them online, and be sure to mention the CEO of Verizon, Lowell McAdam, and use the #Verizon and #LowellMcAdam hashtags.

 

Your campaign:  “(CITY) wants radio on all smartphones.”

 

We’ll highlight your videos, your promotions, and your efforts to talk this up on the air and get your town asking for Verizon to let FM live on its phones. Talk about how T-Mobile is doing this, and be sure to mention Sprint, which got on board with the FM chip a couple of years ago, and how grateful its customers are.

 

If radio makes a collective effort to make this issue known through promotions that are then shared on social media, we can knock down the mobile providers one at a time through consumer pressure. But keep it fun, appropriate, and respectful (we don’t want to see anything backfire).

WATCH THE VIDEO:
 

 

Does Hubbard Know Something You Don't?

Yesterday Hubbard announced that it had purchased 30 percent of Norm Pattiz’s PodcastOne network for a reported $10 million. Why would a traditional broadcaster buy into a podcast network?

 

First, it is common knowledge that Hubbard owns the second highest-billing radio station in the United States, WTOP in Washington, DC. What is less well known is that Hubbard also has the highest-billing digital operation in terrestrial radio. And that happened because of a proactive attitude that understood the future and embraced it. Hubbard President/COO Drew Horowitz and former boss Bruce Reese have studied digital for a long time (we know because one or both has consistently attended the Radio Ink Convergence conference). Hubbard embraced digital early, and, unlike most, has figured out a way to make a lot of money with it.

 

Curiously, Hubbard came very close to investing in online radio when I was fundraising in 2001 for my online radio startup, RadioCentral, but that was disrupted and ultimately fell through due to the World Trade Center attack a week before we met. Perhaps they quietly invested in another online radio company. But clearly, this disruptive technology was on their minds almost a decade and a half ago.

 

What does Hubbard know that you don’t know?

 

Hubbard understands that change is inevitable, and they have a history of being in the middle of change or ahead of it. For instance, it was Hubbard that launched DirecTV, which disrupted the television business — and when they did it, they had a huge investment in broadcast TV properties. They didn’t fear cannibalizing their own stations; instead, they wanted to control what was likely to disrupt them.

 

What can we learn from Hubbard?

 

Hubbard CEO Ginny Morris told us yesterday, "We're interested in learning where that part of the industry is headed." She believes podcasting is more than repurposed radio shows; it's part of the radio landscape that's here to stay and she wants to be a part of it. “How big it's going to be, I don't know,” she said. “I'm convinced it's not going away. I'm excited to see the trajectory. The space is young and we want a front seat."

 

It is critical for all of us is to understand that something always disrupts the status quo, and it's better to own a part of what disrupts you than to have it bankrupt you. Along with fighting to hang on to what we’ve got (which we also have to do), we all need to look at technology that threatens us and find a way to be a part of it.

 

I applaud Hubbard for its investment in PodcastOne and for being so proactive. And I suspect they are quietly seeking to be a part of other disruptive technologies — not because they believe radio is dead or dying, but because they want to be in technologies that have the potential to disrupt the status quo. Clearly podcasting is on a second wave and real dollars are flowing, as are giant audiences. Hubbard will reap the rewards as this increases.

 

People spend a lot of time fighting change rather than embracing it, but rarely does fighting change work. Rather than fighting it, we should all seek ways to be a part of it.

A New Voltair Revelation

By now, everyone in the radio industry is probably sick of hearing about the controversy surrounding the Voltair unit, which supposedly boosts PPM recognition in Nielsen’s ratings technology. I’m a little sick of it myself, frankly, yet since Radio Ink raised awareness of this issue, I feel we need to help bring it to a conclusion.

Since Nielsen came out with its client webinar and stated that it does not support the Voltair, the controversy has only been amplified. Stations and broadcasters want to know if it really works. Some very smart consulting people have been chiming in with their analyses -- some of which appear to show conclusively that any ratings increases with Voltair are merely coincidental and that it is programming that has led to any ratings change. Voltair, they say, is inconsequential.

I’m not satisfied.

Please understand that it’s not that I distrust these people or their opinions, but I think that as an industry we deserve some independent, third-party science. I say “science” because I believe there must be a scientific research study. A good scientist will set out to find answers, not to prove or disprove a particular theory. Data coming from either Voltair or Nielsen will inevitably raise suspicions, fairly or unfairly. Further, I would think that someone like myself, a former program director and programming consultant, might subconsciously seek to prove that it’s programming that makes the difference, because, well, it’s where I made my living, and I might want to prove that it still matters.

I am not a scientist. PPM technology and how the system works is not my expertise. But I am very curious about this issue. So, based on a theory that a rising tide lifts all boats, I was wondering what the impact of Voltair might be on all boats — all stations in a market. Since no one is going to admit they are using Voltair, and Telos Alliance keeps user names confidential, and since groups like iHeart or Cumulus might purchase the units in bulk and not even tell Telos where they’re using them, it is close to impossible to track actual numbers.

What is not impossible is to look at radio ratings market by PPM market and see what has happened in a market overall. The theory being that the bigger, more prominent stations with the most to gain or lose are the most likely to use Voltair units.

Here is what we do know.

We know which markets are PPM markets.

We know the very first production Voltair units were delivered in June of last year. Non-production units were delivered in April or May of 2014.

Based on statements from Telos Alliance, we know that there is at least one Voltair in use in every PPM market.

So my assumption is that if we look at PPM markets over a long period, Voltair might show an effect on overall radio listening. But in any particular market, there might be some larger reason radio listening would rise, so it’s important to look at more than one market. In fact, it’s important to look at them all.

Here’s the problem.

I’m not a Nielsen subscriber and don’t have access to the data.

I’m not legally allowed to publish Nielsen data other than very basic trending data.

But one advantage of a lifetime in radio is a lifetime of connections, which gave me a chance to take a peek at some data to test this theory.

The result is something I want to share. It’s not conclusive by any means. It’s not even scientific. And once you see what I’ve shared, you’ll see why I follow it up with a very specific call to action to all PPM market stations in America to help me resolve this issue.

I wanted to see a full-market report (not specific stations) from a market that is rumored to have a lot of Voltair units. I requested AQH (Average Quarter Hour) Rating January 2011 until June 2015, ages 6+.  

Here is my challenge: I cannot show you anything specific without violating Nielsen copyrights. Nor can I share where I acquired this data because stations don’t want to risk being labeled Voltair users.

I have not altered the chart at the begining of this e-mail in any way other than adding a mark indicating “Voltair start” in June of 2014. I cannot say whether changing trends thereafter were a result of Voltair or some other condition or conditions. But, looking at this chart from one market, I am curious about whether this trend exists in other PPM markets.

I was also able to obtain the estimated number of Voltair units in use in the industry overall month by month; that line is shown to the right of the chart.

Note that radio listening was trending down before June 2014. I’m not sure of the reason for that, but I suspect some of it has to do with crediting online listening vs. over the air. But soon after June of 2014, this chart shows that trend reversing.

What do you think?

Important Next Steps for Broadcasters

One market is not a research study. It merely shows that one or more Voltair units may have had an impact, since the upward trend starts after production units were delivered. But what would happen if multiple markets ran this data?

You need to run this test to see if there is a similar trend in your market. To be consistent, run AQH (Average Quarter Hour) Rating January 2011 until June 2015, ages 6+.

I do not have access to PPM data. You do. You have the ability to share your data with others as part of your PPM agreement.

If every station using PPM were to run the exact same report and share it with me, I’ll be able to see if there is a trend, market by market, across the U.S.A. I’ll find a way to report that data. I should be able to show all the different markets I receive, even if I do not label them specifically so I don’t violate Nielsen copyrights. You can e-mail a screenshot of your market trend to me: [email protected]. I will not use the market name, you will remain anonymous, and you don’t have to be a Voltair user — I don’t want to know.

If stations cooperate and share this data, I’ll prepare an overall view, market by market, with generic labels on the data. Please use the exact criteria stated above.

What’s Next?

Ultimately the industry must have a third party, unrelated to either Telos Alliance or Nielsen, test this further. We need a panel of credible experts who have no link to either company. I’m told by some that there is no way to find a conclusive answer because of frequent format changes and other programming factors. But it seems that looking at total radio listening, market by market, is a good start. And I believe a real, scientific solution does exist.

I’ll look forward to receiving your confidential e-mail and to your sharing your exact market report (based on the stated criteria).

 Disclosure: Nielsen is a paying advertiser in Radio Ink and Telos Alliance is not. Radio Ink understands that we are placing our advertising at risk by revealing these concepts.