Is The RAB The Next To Fall?

A message from Radio Ink's Eric Rhoads

With last week's loss of Radio & Records magazine, the entire industry may be a little skittish when they see any signal of perceived weakness. Last week we reported that the RAB is launching $210 personal memberships in an effort to raise revenues. Yesterday, the RAB laid off industry icons Mike Mahone and George Hyde, along with nine other staff members. I naturally find myself asking, "Is RAB the next industry icon to fall?"

I can't help thinking about the health of the RAB in this environment and wondering if the radio industry will continue to support it when faced with a difficult financial decision. From my perspective, the RAB serves many masters, because the needs of its wide base of membership range from small-market to large-market to radio networks. Everyone relies on RAB for something different. For some it's training, for others, data and support services, and for the industry as a whole, it's the promotion of radio. But I have to wonder if that is all about to change.

Do The Big Guns Need RAB Anymore?

Though I have no statistics at hand, my guess is that the "big groups" make up a significant portion of the annual RAB budget. Big groups have a different mission for RAB than small, independent broadcasters. Most big groups are pushing RAB to "promote national business" and "get more advertisers using radio." Let's call that role national promotion, which has been important to companies that are heavily reliant on national advertising.

Big groups tend to have their own training organizations, so we have to be curious about whether there is value in RAB training for them. But Clear Channel recently closed Clear Channel University, headed by Kim Cutchall. This either means Clear Channel people are so well trained they no longer need it (not likely), that the company cannot spend money on training at the moment, or that they'll increase their reliance on the RAB to fill that void. My guess is it was about cost-cutting.

So if a lot of the bigger groups don't rely on RAB for training, then their big need is for national promotion. But, again, in the case of Clear Channel, which owns Katz and Premiere Radio Networks, and which just hired some big-league media executives to promote radio nationally and internationally, we have to assume they feel they have national promotion under control.

So will Clear Channel continue to write an annual check to the RAB? At this moment, when no amount of national promotion is likely to convince non-spending companies to spend money on advertising anywhere, I have to wonder: Does national promotion play a significant role, during this brief moment of economic crisis? Will RAB be a redlined expense item for bigger groups?

That leaves the smaller markets and independent stations, which seem to rely heavily on the RAB for training and support services. If the bigger groups don't use the training and don't wish to invest in national promotion, the writing may be on the wall that RAB should become a smaller, narrower organization with the sole purpose of offering training and support services. That, of course, would alter the RAB's operating budget substantially (though training and support are probably its biggest expenses.)

Stuck In the Mud?

I've had my issues with the RAB over past years for being a little behind the curve, but I actually think Jeff Haley is doing a great job and plays an important role at RAB, which is to transition radio into a digital media world so it can stay relevant. But do RAB members want to go there? Do they believe in this vision? Is Jeff too far ahead of the curve for radio?

Though radio should buy his vision, and though it is CRITICAL to our future, I wonder if he is getting the genuine support he should have. One has to believe he is having to continually sell old-school broadcasters on the value of becoming a digital media industry, and is probably frustrated by the lack of understanding by many.

The only issue I believe hurts Jeff is that he, like former NAB president and CEO David Rehr, is not from radio. This may hurt him when he tries to rally the troops to get behind him because he is not "one of us." At the same time, his perspective is probably better because he's not stuck in the mud of our past.

Is RAB Relevant Anymore?

Though I do not speak with any inside authority or information, I cannot believe that everything is fine at the RAB. Like any prudent operator, Jeff probably cut a million dollars out of his annual operating budget with the terminations yesterday. That's not fun, but it's good business. His revenues have to be off.

Though the RAB conference was one of the best and most relevant in recent years, it could not have been more than a break-even attendance. One has to assume cancellations are coming in as stations faced with renewals try to preserve cash. So should we let the RAB fade away? Should it pick a single-focused mission of national promotion or training, but not both? As my father told me during the last big recession, "It doesn't really matter if you become a shadow of your previous self, the most important thing is to stay in business. You can always add services back when things improve." That is how I feel about RAB.

I feel that RAB remains a critical focal point for the radio industry, and I believe its loss would not only hurt radio on many levels, it would hurt the perception of radio. Imagine the headlines: "Radio industry is in such sad shape it allows its industry promotion agency to die."

Radio's Beating Heart

No, we must not let the RAB die. Though Jeff may have to pare it back to a fraction of its previous self, though he may have to shed most of the services and may have to cut rates dramatically to keep members, we must keep it alive. There is tremendous value in the collective brain trust of its board, which benefits radio. There is benefit in the ability to provide leadership to the industry. And radio faces tremendous PR challenges and we still need a promotion arm.

The RAB is, in my opinion, the beating heart of radio, and we as an industry must support it and keep it alive in some form. It can always return to its past glory and more services at a later date.

Is it Time for a Merger?

Recently, at some industry event, I cornered a couple of executives and suggested that perhaps it's time to merge RAB and NAB. Clearly the organizations have differing missions, but in a broader sense, their missions are the same: Keep radio healthy. (Though NAB has to keep TV healthy too.) Though I would prefer to have them as separate organizations, I wonder if it's time for them to merge? They can gain tremendous efficiencies in duplicated backroom and support services, plus savings in real estate.

RAB already does the radio agenda for the spring NAB show and there is discussion about rolling the RAB conference into the fall NAB Radio Show (especially now that R&R is no longer part of the show). Plus, the NAB needs a leader. Why not Jeff Haley? Or if that doesn't fly, why not let RAB either be a division of NAB, or, at least, subcontract services from NAB and have Haley operate the RAB while NAB operates the engine behind it? Sure, there are politics, TV interests, etc., that may keep them apart, but it makes logical sense. Stations could pay slightly increased NAB dues but eliminate RAB dues and save money. And the industry wins because we keep RAB alive and healthy.

Every expense is examined under a microscope today. Sometimes it's difficult to quantify the value received from organizations like RAB, yet there is tremendous immeasurable value, and we as an industry should not let RAB become a casualty of this economy. It plays a necessary role for radio, and we should do anything in our power to keep it relevant and alive.

Eric Rhoads

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Comments

[Frank Zappala]

Eric:

Great perspective. It is often difficult when you are up to your armpits in alligators, to remember that the mission is to preserve the swamp! There are essential elements to the ultimate survival and continued growth of radio, that do not relate to the immediate revenue and cash flow picture.
An organization without a vision, strategic plan, and dedicated effort to build image and value will soon go the way of the dinasaur.

Stations, and station groups need a strong organization promoting the value of the radio industry, its importance to every day life, and remind planners and marketers that in a new digiatl age, radio will play an even bigger role in influencing consumers.

[Bob Doll, trade press and radio history author]

Eric:
Your article is excellent. I can understand that RAB may have to cut back, but, that should be done carefully. In
my town, the local radio station, is running a message directed to the local business and professional people, offering the station, its daily free circulation newspaper and web site as help in solving problems and realizing opportunities during the recession.
The message reminds listeners that "tough times don't last - but, tough people do." The RAB needs to embrace that kind of posture. IT SHOULD NOT MERGE
WITH NAB. Each organization has
its distinct important mission.

[Rod Schwartz - Grace Broadcast Sales]

I gratefully plunked down my $210 for a personal RAB membership.

This is something I've asked them for on more than one occasion over the years, because the stations I've worked for haven't always been able to sustain their RAB membership.

For anyone involved in selling or creating radio advertising, the RAB archives are a treasure trove to rival Captain Barbossa's stash on the Isla de Muerta.

With your permission, Eric, I'd like to post your timely article up at Radio Sales Café (www.radiosalescafe.com), where I am urging all radio advertising sales professionals, whose stations do not already belong to RAB, make this important investment in their careers and their clients' successes.

One hopes that the RAB won't hesitate to speak frankly and freely about their needs. Such transparency is not only in keeping with the spirit of the times, but I believe would accrue to their benefit in terms of response from a grateful broadcast community.

Great piece, Eric!