How Detroit Opened Our Eyes

Two years ago, at our Convergence conference, radio heard the term "connected car" for the first time on one of our panels. Our connected car discussion last June led me to write an impassioned editorial about the possibility of the dashboard's being without AM or FM in the future. Of course, radio's competitors spread that editorial to every advertiser in America, and the issue suddenly became top-of-mind.

I want nothing more than to see our industry succeed in the future, so I decided something more had to happen to assure radio's solid presence in the automotive dashboard. And that process would involve a dialogue between the automotive and radio industries. I also knew all the players needed to be present, including advertisers, OEMs, and online radio companies.

That event, the DASH conference, took place earlier this week in Detroit, thanks to the teams at Radio Ink, at Jacobs Media, and at Shuman Consulting Group, who partnered on the project. We also invited media partnerships with other industry associations and trade publications because we felt we needed everyone involved if this was to be a success.

Before the DASH conference, myself, Fred Jacobs, and Valerie Shuman arranged a private luncheon to begin the dialogue between radio and the automotive industry. We invited Greater Media CEO Peter Smyth and Entercom President/CEO David Field, as well as RAB President/CEO Erica Farber. We paired them together with representatives of three major automotive manufacturers: Julius Marchwicki, Ford Motor Co.'s Global Product Manager/SYNC AppLink; Wayne Powell, GM/SEE for Toyota Motor Engineering and Manufacturing, North America; and Greg Ross, Director of Product Strategy and Infotainment, Global Connected Consumer, General Motors.

After two days in a Detroit airport hotel, I'm here to report that the DASH conference was not only a huge success in attendance, it was a success in many other ways as well. Most importantly, it was a conversation among radio, Internet radio, advertisers, car dealers, OEMs, and the major automotive companies -- which were not only represented, they had people in attendance the whole time and embraced and welcomed the radio-industry interest in their strategies, were engaged in our dialogue, and listened with an open mind. One car manufacturer said onstage that this may be one of the most important events in history to keep consumers engaged with automobiles and the right audio strategy.

It wasn't all rosy, however. Radio also got a dose of reality about how the connected car is changing listening habits. Edison Research's Larry Rosin stunned the room with a video created for the conference that showed consumers using connected cars and being interviewed about how they listen to audio in the car. Though the sample was small, the information took everyone by surprise as formerly loyal radio consumers discussed how their habits had changed. It was very clear that technology and available alternatives can have an effect on listening behavior.

We saw dashboards that had multiple presets allowing listeners to go from Pandora to NPR to and iTunes account in the same way they use radio presets now. We heard one young woman say, "Poor FM. I don't listen to it anymore because I don't have to," as she described how she used to listen in her old car and how her new car has her spending time with other alternatives. Others on the video explained how they use radio, and it was clear that the hands-free environment changes how they access radio. And the radio people in the audience saw clear evidence for how they need to talk to their audience to make sure their station ends up as one of the alternatives sought out in the connected car.

Rosin pointed out that these connected car drivers will listen to radio only when radio offers unique, compelling, live and local content they can't get anywhere else. One major advertiser, Fred Sattler, EVP/Managing Director for Initiative + in Los Angeles -- he controls advertising for Hyundai and Kia -- reinforced that radio won't hang on to advertisers unless it is offering live, local content. He said syndicated air personalities are not unique enough to the local town, the local dialogue, and the needs of the local community to interest him as an advertiser in a connected car environment. That means some radio companies today are moving away from radio's best remaining strength: unique local content.

It's impossible to summarize a two-day event here, but a good starter is checking the Twitter hashtag #DASHAudio. Frankly, those not in the room who sent representatives to report back will get bullet points, but may well miss the essence of what those who were there received. I suspect every radio person who attended is already changing things about their strategy as a result of lessons learned at DASH.

And some of those lessons were hard to swallow. For instance, a panel of local car dealers who were previously giant radio spenders revealed why, in a couple of cases, radio has fallen off their radar and budgets have been shifted elsewhere. Jaws in the room dropped when we learned that part of the migration away from radio could have been prevented. More jaws dropped when dealers discussed radio's lack of data and proof of performance compared to Pandora.

We saw staggering stats about mobile adoption and about connected car adoption and  learned that virtually every car from 2015 forward will be a connected car. Most cars on dealers' lots today are connected, and that will clearly have an impact on consumer behavior and their use of audio.

Radio also learned how well embraced it is by most of the car companies, which can perceive radio's strengths and weaknesses but love radio's relationship with consumers. Most agreed they are committed to radio receivers for the near term -- but whether the dashboard will include radio over the long term will depend on how deeply the industry responds to automakers' needs, and to advertisers' need for data. Clearly the dialogue has begun and radio has a huge open door to participate in the dashboard's future. If we achieved nothing else, it was worth it to see this dialogue begin.

Radio's continued dominance in the car will depend on how each of us responds. It is absolutely critical to drive and experience connected cars and conduct in-market studies about how consumers are using the connected dashboard in your town. Though we assume listener loyalty is still there, we need to be open-minded in understanding how we  respond to listener needs, especially since the average car on the road is now 11 years old and 2015 is expected to be the biggest year for auto sales in history. All those new cars are connected, and radio must reflect on how it approaches the in-car listener. We also need to ask: Are we even still radio? My guess is that a few dozen stations attending DASH will go home and start calling their stations "audio."

Furthermore, radio must seek improvements in technology to become searchable, and allow consumers to time-shift, rewind, and pause. These needs were revealed in consumer research and are based on expectations for what the connected car offers in other audio sources. HD Radio may be the entry point to make these things happen.

Radio needs a presence in the car companies, in Detroit and in Silicon Valley. Much like Interep used to have an embedded radio person inside the major agencies, it may be time the industry embeds radio representatives inside Ford, GM, Toyota, and others. Pandora and TuneIn, Greater Media and Clear Channel have representatives in Detroit.

Most important, radio needs to be on its game. Suddenly you're not just competing with other stations -- the buttons on the dashboard lead to Pandora, Slacker, Spotify, iTunes Radio, and thousands of radio stations on TuneIn, Aha, and iHeart. Reinforcing your strength and brands in your market is more critical than ever because only loyalty and habit will overcome a variety of options. Being a jukebox with long stopsets won't compete with services offering music and few or no commercials. Your advantage needs to come from the strength of your talent and your links to your community.

Eyes were opened at DASH, and I leave Detroit encouraged for our industry. But our success is far from cemented. There is much to be done, and you'll be seeing much more connected car content in Radio Ink. Please make a point to get connected to this technology and talk to listeners using it. Your eyes will be opened too.

Please DO NOT reply to this e-mail; responses do not go directly to Eric Rhoads. If you'd like to comment, please go to: http://ericrhoads.blogs.com/ink_tank/

 

 

Thanks to these sponsors who supported the DASH conference:

 

Presenting Sponsors
Clip Interactive
HD Radio
iHeartRadio

CORPORATE SPONSORS
Nielsen Audio
Spanish Broadcasting System
Triton Digital

SUPPORTING SPONSORS
Ford Motor Co.
GM/OnStar

MEDIA SPONSORS
Adcraft
Connected Vehicle Trade Association
Mobile Electronics Retail Association
Mobile Technology Association of Michigan
RadioDiscussions.com
RBR/TVBR
Radio Interactive International Radio Summit

 

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[Joseph]

I am admittedly underinformed on the issue, but has the problem of many cel phone plans offering only limited amounts of data been solved?

[Karen Porter]

Since the emergence of the smart phone I have said radio, especially those targeting young listeners will be in trouble. As the manager of a Hip Hop station in a city with 10,000 college students it amazes me how many of our promotions fail. Why? They just simply don't listen anymore. The phone is used to listen to music in their cars, download all the new hits, and if you do not use instagram to promote an event you are dead. My son is 22-years old, can tell you everything about all the new hip hop music but yet he never listens to radio. Never. Clubs simply don't need radio any longer when they can promote an event FREE on instagram with great success. And for Hip Hop stations, entertainment is the largest revenue category.

I am perplexed about how to move forward in this industry. Your overview of DASH was compelling, and for radio station managers its difficult to figure out how to connect to our listeners when they have stopped using radio as their source of entertainment. The in-car young listener is using the phone, connected to their car audio system, but not tuned to your station...or any station.

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[Ilene]

You can view #DASHAudio tweets here - http://tagboard.com/dashaudio

[Greg]

"Automakers Get HD Complaints"

"But even when HD stations do implement HD Radio or put a multicast channel on the air, they’re not always able to pay attention to the alignment of the analog and digital signal. That’s a problem, because complaints about audio quality are starting to arrive at dealerships. IBiquity Senior Vice President of Broadcast Programs & Advanced Services Joe D’Angelo ticked off several: customers say the HD often echoes as if two signals are being received slightly out of time, or the audio sounds as if the station is skipping. Other complaints include the radio doesn’t pick up HD stations, ever. Or, the HD goes in and out. Owners have been slow to embrace the advanced data features that can make a radio display look like its competitors, such as satellite radio or Pandora, in the dash. Only some 400 stations have so far and that’s a problem, according to HD proponents; they believe that if stations don’t step it up, automakers will move radio down the center stack of priorities in the dash, so to speak."

http://www.radioworld.com/article/radio-eyes-all-forms-of-%E2%80%98digital%E2%80%99/

Yea, and the HD Radio scam is the answer! LOL!