Happy 2010!

Phil Bernstein is a blogger in Portland, Oregon. He's also an account manager with Portland's Clear Channel radio stations. And he writes about advertising. He's on Twitter, LinkedIn and Facebook, too.

Writing about marketing so that his customers can see his thinking differentiates him from virtually every other radio sales person out there.

This is the kind of person that is the future of radio - forward thinking and ready to tackle the marketing of his customers businesses with some marketing of himself. Hats off to Phil!

http://philbernstein.wordpress.com/

House Committee to Review PPM

The House Oversight and Government Reform Committee is set to hold a hearing on Wednesday, December 2, to examine Arbitron's radio audience measurement device, the Portable People Meter (PPM).

The government's intrusion into the measurement of media audiences is fraught with problems, illustrated by this quote from the chairman of the committee - Congressman Ed Towns, from the second paragraph of the committee's announcement:

“With an unprecedented decline in ratings among popular minority television and radio stations, we must explore the possibility of methodological flaws in the implementation of the PPM,” said Chairman Towns. “As it stands now, the current system jeopardizes the future of minority broadcasting.”

Congressman Towns, what connection would a "decline in ratings among popular minority television...stations" have to do with PPM? PPM only officially measures radio, and even if Arbitron did measure local TV, there could be no decline in ratings because there are no pre-ppm ratings from Arbitron to compare to!

Here's more from this press release - pay attention to the bolded portion in particular:

Chairman Towns served a subpoena to the Media Ratings Council (MRC) in September 2009 for documents detailing its oversight of Arbitron’s use of the PPM, after Arbitron forbid MRC from releasing documents related to the Committee’s investigation. Although Arbitron promised full cooperation with the investigation, the company prohibited MRC from providing the Committee with any documents related to the PPM. Furthermore, Arbitron provided the Committee with insufficient documents that were either publicly available or biased toward the company.

So - the Congressman wants more documents that are "...publicly available or biased towards the company?" Huh?

This hearing should be interesting. Not because the subject is particularly compelling, but because it may be an illustration of exactly why government shouldn't be involved with issues like the measurement of media exposure.

If Congressman Towns' and the Committee's statements are indicative of the way the hearing will proceed - discussions of why the PPM has reduced TV ratings and why Arbitron hasn't provided the Committee with more publicly available or biased documents - then Congress will have wasted valuable treasure of time and resources.

Radio's future - sure seems like the past to me...

Mark Ramsey has more good stuff on his blog in a week than most people do in their lifetime. Today is no exception. He posts about The Most Important Thing You'll Read About Radio's Future this Year. I read this once and said, "Yeah!" Then I read it again.

It suddenly hit me that this is where we were back in the 80s. Marketers were pushing us to become more invested with their marketing. We built teams at stations focused 100% on developing non-transactional business. We called it all sorts of things, from NTR to Vendor. Hundreds, maybe thousands, of bright marketing-oriented people joined these teams either from the ranks of radio sales or from the greater marketing community. We developed relationships with food brokers, wholesalers, marketers at CPG companies, and small marketing teams consulting CPG companies. We learned all about in-store display, push vs. pull marketing, consumer promotion, floor plans, vendor-funded marketing programs. Millions of dollars were invested by radio broadcasters to support these programs and they began to return their investment. We did not sell using Arbitron numbers. We sold using the results of the last program. And, those results were terrific! So, we were able to get more and more marketing dollars for the programs and give up less and less inventory on the station.

And then something happened.

The advertisers said, "You know, let's go back to buying on Cost per Point. And, while we're at it, you can throw in all that extra stuff as a freebie for just getting on the buy." Radio managers caved. NTR/Vendor departments were decommissioned or turned into ghosts of themselves. Smart marketers left radio, were fired in consolidation moves, or they were sucked into the vortex of transactional radio business.



When I think about Mark's article and the points he makes,

1. Act more like a marketing company than a media company.
2. Be organized around an audience and not a platform.
3. Work directly with marketers.
4. Not just create spaces for ads next to content, it'll create whole media channels and platforms for brands
5. Employ technologists who can build device-agnostic platforms for marketers.
6. Know how to deliver instantaneous gratification when it comes to measurement, and it'll be measuring outcomes not outputs. A rating...stat is not going to be enough in the future, and certainly not when it's presented weeks after the fact.

I can't help but remember what these same marketers have done time and time again - when it suits their need, they go back to twisting radio's arm with commodity pricing. And radio lets them do it.

Don't let them do it again.

Are Podcasts Dead?

On Friday, Leo Laporte, founder of the This Week in Tech network of programs, spoke at the Online News Association conference in San Francisco. His comments and the questions from the audience afterwards can be seen here.

The speech is very interesting and it exposes Laporte as a true renaissance man. One of his more controversial comments is a statement that "Podcasting is dead." This is quite jarring, since it comes from the guy who many of us think as "Mr. Podcast" (OK, Leo, "Mr. Netcast"). He has built a very nice business by delivering 20+ podcasts weekly to an audience now in the millions worldwide. Leo goes on to say that he began to feel that podcasting was "dead" about a year ago and began building a streaming platform so that his network was prepared for the transition. Today, the TWIT Network delivers all its programming both through audio podcasts and via live streams. When there are no live programs to stream, they replay recently recorded programming on the stream.

Of course, he didn't mean that podcasting was history and that no one is listening anymore. Podcasting has reached a plateau in its growth. Leo noted that for most veteran podcasters, growth began to flatten out about a year ago. To grow audience beyond the people who are willing to put up with podcasting's current rather chunky user experience, a new archetype needs to emerge. Leo feels that this new archetype is a combination of live and on-demand streaming... different than podcasting's "store and forward" approach. New dedicated devices like the Roku will provide this kind of service to consumers. In fact, Leo said that he was teaming with Mediafly to provide his network's offerings on the Roku device.

Many people listen to podcasts right at their PC - either not realizing that they can go portable with their iPod or just not caring to. Many others take their content with them - to the gym, on the road, to work. I have found that loading up my iPod with programming that I want to listen to allows me - with minimal effort - to listen both at home and on the road. My TSL for broadcast radio dropped precipitously when I began doing this and it has not recovered. One of the reasons for this is content; however, the main one is convenience. I can listen to what I want, when I want. The broadcast radio over-the-air streaming model doesn't allow for that, yet, although the new iPod Nano is providing a baby step in that direction with the "pause listening" feature. On-demand streaming might, but only when the technology reaches mobile platforms.

On-demand streaming is coming - Flycast and other similar services provide a rich portable mobile experience, mixing live broadcasts with some "on demand." Until ubiquitous wireless broadband is available - and at a price that can be absorbed by the masses - this will remain a platform suffering from similar restrictions to growth that technologies like podcasting are experiencing. Some sort of local storage of content will be needed for some time to come. Many technical folks feel strongly that the wireless IP network is not yet up to the demands of delivering streaming content to portable devices. Today, with relatively few people (some subset of iPhone, Android and Blackberry users) accessing audio streams while mobile, it's not an issue. Globally, the iPhone has sold about 20 million units. That's just the population of New York. Imagine all 300 million Americans trying to stream audio at the same time! It's not a scalable model yet.

So - to answer my rhetorical question - no, podcasts aren't dead. Podcasts are just going through the same rapid evolutionary process as other delivery vehicles. Smart people, like Leo, are finding ways to augment the audience that the podcast delivery mechanism provides. Others are building alternative distribution channels to iTunes. The concept of podcasts will be with us for a while - until the practical application of technology provides a better solution.

Nielsen, Arbitron and the Upcoming Battle - Part II: Engaged

Several months ago, I wrote an article about the potential for battle between Arbitron and Nielsen. It was called "Nielsen, Arbitron and the Upcoming Battle." You can link to it here.

Since then, Arbitron announced its "ARB-TV" program and just last week the Financial Times broke a story about a new consortium of advertisers and agencies

In today's "Taylor on Radio-Info," Tom Taylor had a couple of paragraphs on this topic. He says, in part:

Now, #3, I’m hearing more concrete chatter about Area 51-kinds of research using an electronic detector much smaller than a PPM.

I thought to myself - "huh, top secret development? Didn't I post a link to the actual photo of the Nielsen Go Meter?"

So, I popped back to the article and - lo and behold - the link to the picture of the "Go-Meter" was broken. A Google search for "Go Meter" or the file name for the original picture turned up nothing. Any reference to the "Go Meter" has been (it seems) removed from the Nielsen website. Interesting.

So - Tom is right. Nielsen HAS gone stealth on its PPM attack project.

Also in his article, Tom mentions the idea of installing encoding software on a cell phone that would perform the function of a device like the PPM. There are many problems with using a mobile device like a cell phone as a measurement device for audience ratings. The biggest one is the instability of the platform. A measurement device for media audience ratings needs to work like a simple appliance. Having other applications running on the platform at the same time raises the possibility of instability exponentially. Thus, the whole platform could crash and detection of media exposure would stop. The way to avoid this is to use an imbedded operating system on a single-function device, like the PPM. These devices can be rock-solid stable with very high levels of reliability. There are also behavioral reasons why the cell-phone solution doesn't make sense, but this single technical reason is enough.

So - Arbitron and Nielsen are rattling sabers, but in a "muffled" way. It's clear that the muffles will be taken off the sabers pretty soon. Nielsen will attack Arbitron in the major markets with portable electronic measurement. Arbitron's move is to encroach upon Nielsen with its ARB-TV project and alignments with companies like TRA and Tivo.

Let the battles begin!

Ratings, Radio, Sales - The Debate Goes On

Chuck Francis, VP New Media at RemergeMedia.com, wrote a well-received article in Radio Business Report recently called "A New Day for Radio."

Chuck makes the valid point that, in truth, ratings don't matter, except to "...those that provide ratings." However, this common-sense statement misses the mark. Yes, it's not the ratings that matter to the listener or the advertiser. It's the thing that the ratings represent.

For example, Chuck says:

In the years I spent as a Program Director I cannot recall one single instance where a listener came up to me at an event or a remote and said: “the reason I listen to your station is because your station the number one station.” In fact, even if your station is 13th in the market – I’d argue you’re number one in the minds of the people that listen to you regularly.

One of the reasons that a listener is loyal to a station is because of its reputation among her peers. The listener doesn't look at the ratings and make a rational decision about whether or not to listen to a station because it's #1 in one category or another, but she does decide whether to listen partially based on her peer group's relationship to the station. The ratings are a surrogate for this - they tell us roughly how many and what kind of people are listening to each station. They tell us about the listeners' peer groups.

On the advertiser side, the ratings are a surrogate for a true measure of results. In the absence of a way to directly measure the ability of a station to deliver results for a specific product, the ratings system was developed in an attempt to predict what will happen if you run a spot on a station.

Those stations who achieve success without ratings have found other ways to measure their reputation with their audience and to predict the results their advertisers will have when they run a spot on the station. However, I suspect that these substitutes for ratings remain surrogates of a direct measurement of reputation or results.

TRA, a research firm in New York, is developing a very interesting way to measure results in TV advertising... a methodology which could well be transferred to radio and other media. Instead of measuring how many people are viewing a particular program, TRA measures how many people actually were exposed to a specific ad and how many of those people actually purchased the product being advertised. This is similar in many ways to the work that was done on Arbitron and Nielsen's suspended Project Apollo, but TRA is processing millions of households' viewing data and matching it up against their purchasing data. As this platform matures and is able to capture not only TV viewing but also other forms of media, we will move away from the surrogacy of ratings and towards the direct measurement of the results of radio campaigns.

Of course, it is not likely that this direct measurement of results will be applicable for all advertisers, particularly local retailers. As data is developed inferences will be possible that are much more precise than today's rating system. TRA could syndicate their data in such a way as to provide local decision-makers tools to determine which media selections are best for their businesses.

Direct response radio marketers are measuring this today, for their clients. One particularly sophisticated firm, Strategic Media, has literally written the book on the subject. Through extensive testing and results measurement, they have built very detailed databases of the stations and creative execution that works best for their clients. Perhaps local radio can learn from this and develop similar data for their advertisers to use.

Please share your views on this subject by commenting on this article.

Has Arbitron really exited the streaming audio measurement biz?

Katy Bachman, in a brief article in MediaWeek reporting on the decision by TargetSpot to use AndoMedia for its streaming audio measurement, also stated that:

Arbitron quietly decided to get out of the streaming radio ratings business earlier this year and discontinued its relationship with comScore. According to industry sources, Arbitron was unable to make money from the business faced with a competitor who charged little or nothing for the ratings and delivered them as a byproduct of its ad server business.

Well, it must have been very quiet, because the only other mention of this I found was on the blog Internetradioworld in a post on April 9th:

According to industry sources, Arbitron was unable to make money from the business faced with Ando Media, their main competitor, who charged little or nothing for the ratings and delivered them as a byproduct of its ad server business.

InternetRadioWorld's blog entry seems to be an analysis of the impact of such an exit on the industry.

Both of these articles were within days of Arbitron and Edison's announcement of the research from their "Infinite Dial 2009" survey indicating that online radio listening cume audience has increased to 42 Million.

Now - Michael Skarzynski, the new CEO at Arbitron, and all the other folks at Arbitron, are pretty smart. I strongly doubt that Arbitron is "getting out" the streaming audio measurement business and leaving it to AndoMedia. And the folks at ComScore are quite bright, too. Measurement of streaming media has been a big investment for them and the market for this data is only going to grow. So, what's up here?

Arbitron Adding Significant New Feature to PPM

In the flurry of press announcements heralding the start of the NAB Show in Las Vegas today, Harmonic Inc. and Arbitron Inc. announced the use of Harmonic's Rhozet™ Carbon Coder universal transcoding technology in Arbitron's PPM media research services. In a quote from the press release, Taymoor Arshi, Chief Technology Officer at Arbitron, said:

"Our goal is to offer our customers new measurement solutions using our Portable People Meter technology. Our integration with Rhozet Carbon Coder helps by providing customers with the ability to prepare their content within their current workflows for inclusion in our media research services."

The press release further states:

The Carbon Coder software will be used in production pipelines to embed an inaudible code into the audio portion of entertainment and advertising content. This code can be detected by the Arbitron Portable People Meter™ (PPM™).

What does this mean for the PPM service? Theoretically, any digitally processed content - programming, commercials, and so on - can be encoded with this technology. Currently, a special "PPM™ Encoder" is required to insert the sub-audible code in the content, typically in the audio chain of the broadcaster. While perfect for measurement of media outlet audience, the current technology does not allow for the direct measurement of specific program elements like commercials and features. The Rhozet Carbon Coder will allow Arbitron to measure audience levels for all encoded media content - regardless of the source. For example, to measure exposure to a specific commercial or album track, you would need to know the exact time that the content aired on each outlet. You would then need to cross-tab this information with the PPM™ rating for that exact time, for every outlet. While not impossible, the current state of reporting of this information is quite challenging. One company, MediaMonitors (a division of RCS, which is owned by Clear Channel) has built a business around this process with ground-breaking products like Audience Reaction™ and Mscore™. MediaMonitors accomplishes this by electronically monitoring radio stations, storing "fingerprints" of the content in their database, and then cross-tabbing with the minute-by-minute PPM™ data. The power of MediaMonitor's solution is that it does not require encoding of the content prior to broadcast. The weakness - in the new world of encoded content that Arbitron and Harmony are creating - is that for encoded content, you will be able to determine exposure whether or not the outlet itself is encoding. An advertiser would be able to have a window on exposure to a specific commercial - whether video or audio - across all platforms that are measurable by the PPM™ device. This is very powerful, and when fully matured, the technology will have the potential to change the media marketplace in very significant ways.

Imagine, if you will, a video that is originally aired on a broadcast TV network. The audio is re-broadcast on radio stations around the country. Clips of the video are posted on YouTube. Elements of the video are edited and placed in various podcasts. Re-runs air on cable networks. Jon Stewart airs a clip. You get the idea - all of the exposure to this content will be measurable in PPM™ markets if the original content is encoded with the Arbitron/Rhoznet Carbon Code.

This relatively quiet announcement at a trade show generally focused on broadcast engineering will have a profound impact on the entire business of media. And, it's another "shot across the bow" by Arbitron to it's rival, Nielsen.

Interview with Ernest H. Clay of ARB

I found an archived interview of Ernest H. Clay of ARB, circa 1960, on the subject of TV ratings as they stood at the time. Very informative and many of the questions raised are the same that we hear today. Listen here.

Streaming Audio ROI Spreadsheet

A while back, I wrote a spreadsheet for some simple calculations of the return on investment for streaming audio - like a radio station.

I have made some changes to the spreadsheet to accommodate the new negotiated SoundExchange fees for terrestrial broadcasters who stream.

Here's a link - click on the picture and then you should be able to edit the cells in yellow to see the results of different audience size, spot counts and so on.



It's a work in progress - tell me what you think!

Using a Macintosh in a Radio Station

Chris “Doc” Tarr, Director of Engineering for Entercom in Milwaukee and Madison, WI, wrote an article for RBR today about using Macs in radio stations.

As a business technology consultant for radio stations, I strongly endorse Chris's statement.

The Mac is a terrific computer for a radio station. It is simple for even the most technophobic account exec to use and because it comes pre-installed with a ton of useful software, there's a lot you can do with it out of the box.

For example, with the extremely powerful (and included as part of the OS!) iMovie video editing software, even a neophyte can produce compelling video presentations for your sales department or your website. GarageBand, the Mac's audio editing system, provides many of the features of a much more sophisticated package like ProTools. Thousands of bands have produced professional recordings using GarageBand, right on the Mac. It even has features for creating podcasts - including building the RSS feeds and so on. Very powerful stuff.

For an extra $79, you can get Apple's iWork, a suite of three applications that include a word processor (Pages), spreadsheet (Numbers) and presentation program (Keynote). In many ways, these applications are even more powerful than MS Office - and they are certainly easier to use. There's no doubt that Keynote blows away Powerpoint as a presentation tool. Plus - you can create your presentation in Keynote and then export a perfectly compatible Powerpoint version for your less capable colleagues.

Plus, with the free OpenOffice package for OSX, you can have the complete functionality of Microsoft Office on the Mac without the cost!

I have run a virtual machine on my Mac with copies of Tapscan, Maximi$er, PD Advantage, AudioVAULT and various music scheduling packages - and they worked without a hitch. Of course, the vendors get a little "hinky" when you run on unapproved hardware, but with the right relationship with these folks, you can get them to understand.

Imagine being able to create a Tapscan report and then use it seamlessly in a powerful Mac-based presentation package to create a compelling story for a prospect. Of course, as these applications go more to the web (as Max and Tapscan are starting to now), you will be using the web browser and not a built-in application; but the principle still applies. Even more so, because the Mac will let you dress up those dull-looking web reports with some truly persuasive graphic elements - in a snap.

Back in the day, before Maximi$er, I used a Mac to suck in AID runs (remember those?) and automagically transpose them into compelling graphical presentations for my sales team. Even 20 years ago, it was a very useful tool in a radio station.

Another advantage to using a Mac on the business side of a radio station is, quite frankly, the "cool factor." Many radio station clients are Mac users themselves - ad agencies in particular have been one of the strongest vertical markets for Macintosh for decades. If you walk into a presentation to a group including a creative director, media director and account manager and you plug in your Mac for a Keynote presentation, you will gain immediate "inside" cred. It might be that extra edge that gets you the deal.

Today, the Mac will give you an edge over the competition.

Want to know more? Please leave a comment here.

iPod Shuffle - VoiceOver feature is a great promo vehicle for radio!

Apple this week released their latest iteration of the iPod Shuffle, a diminutive digital audio player that has no graphical user interface. In fact, until this version, the only user interface it has had is the navigation button.


With the new iPod Shuffle, Apple has added voice navigation, allowing the listener to press the navigation button and hear the title and artist of the song that is currently playing.

The title and artist information comes from the ID3 tag in the audio file metadata. This could make for an interesting promotional opportunity for creative radio station. Here's one way it could be used:

Let's say the I101 is an indy rock station that promotes local, unsigned talent. These acts distribute tracks via the station's website (free). In return for promoting their act, the station edits the ID3 tag in the track (with the artist's permission, of course) to include a station promo. For example:

Title: "Drivin'" Artist: "Rich Hannon, brought to you by 103 RNR where music matters"

Listener downloads, listens, presses button to hear the title/artist and also hears the station promo!

So - let me know if you use this idea and how it works. There's definitely a lot of potential here.

Radio's Social Community

Neal Bocian, an agency guy who is a keen observer of the radio scene, has again posted a terrific commentary on radio, this one addressing the issue of how local radio personalities make the brand of a radio station. Here's a quote from the article:

Every personality on a radio station has a job to do, and that job is no easy task. They have to create unique content every day to engage their listening audience. That personality is the moderator of a “community”. A community analogous to communities you find online, like blogs, Facebook, and Twitter. It’s people who can relate to that DJ, whether its their programming including views on subjects, poking fun at people, news events, satirical opinions- the list goes on and on. What’s most important is that they add value to the station, and changes the “vanilla” flavor to something that adds “spice” for the listeners. There is such a disparity between “cookie cutter voice tracked programming,” to a personality who can relate to the local community and listeners alike. It is like going from one end of the spectrum to the other. Yes, radio stations CEOs can save money by eliminating the talent on air and replace it with voice tracked programming, but at what price? You save a salary but you deteriorated and cannibalized your audience as a by-product. That same audience you worked so hard to acquire.

When you read the entire article, you will see that he has a different perspective from the normal radio pundit. Neal is someone who believes that the medium is unique in its ability to deliver results for his clients because of the personalities social connections to the local community.

We're interested in your comments - please write!

Monetizing Technology

Alan Mason, a consultant to the radio industry and partner in the GoodRatings consultancy, made an interesting comment in an article today:

Take Twitter on the other hand. It's jumped from nothing to more than five million active consumers in a short period of time. Raise your hand if your station as more than five million people in the cume.
But it's not about Twitter, it's about why consumers use it and how it will help you engage your consumers. That's the important part, the level of relationship you have with your listener us where the money is, not with the technology itself.
If you want to monitize technology you need to get into the technology business. In radio, it's still about how many people listen, and how passionate they are about you, not about whether you twitter or not.

The technological tools that are available today are not going to make you money unless you find a way to tie them to your core business - radio. For example, you're not going to be able to monetize your twitter feed; but, you could use it to drive listeners to your advertisers by using tiny urls and measure the click-through response. Just an idea.

No Free Lunch

An article on Boston.com, the Boston Globe's web presence, today discusses the abandonment of lunch service hours at Locke-Ober, a venerable institution in downtown Boston.

As you scan the article, look for what's missing as associated content.

Figure it out? No? Then, you need some remedial work in marketing 101.

What is missing is ads for lunch options around the neighborhood of Locke-Ober! Now, Boston.com is one of the original newspaper-owned websites and they do a tremendous job with their content. But - if the Globe is going to survive, they need some creative advertising sales efforts.

You can be assured that if you were reading this article on a Google-run site, you would see three our four ads with links to local restaurants.

So - how does this connect to radio? Well, imagine if you had the ability to be airing a local news story on your station about this subject and an ad (with a link that the user could type into their iPhone) appeared on the dial of the radio for a substitute restaurant. This ad simultaneously runs in the audio player for your internet stream, where it's clickable. Plus, a link goes out to Twitter.

Impossible, you say? Not so - it's very do-able today, with technology from companies like Broadcast Electronics and their "The Radio Experience" product line. They call it "Messagecasting" and it can be up and running in a radio station in just a few days.

This is the kind of thinking that all media outlets will need to embrace. Think synergy between your content (whether news stories, music, whatever), your listeners and advertisers. Think of ways to make the advertising accountable. Think of ways to not insult your audience with poor execution.

It is clear that the platform we will see emerge is a hybrid of "broadcast," web-based (I really want to say IP-delivered) and tangible media (as an example, scaled down newspapers). Local media entities will become a synergy of these parts. Each entity will have its own personality ("stationality") focused on it's rather narrowly targeted market. Because of the interaction between the components of the platform, advertising results will become more accountable. The successful local media entities will not be focused on just one or two media types (i.e., written word and video or video and audio) but will cover all media types equally well. Why? Because each one has its advantage for certain users in certain situations.

The Audacity of Hopes

The well-written and to-the-point article by Jim Hopes, CEO of the Center for Sales Strategies, on the future of traditional media selling provides a cogent analysis and an audacious (in the good way) solution to a seemingly intractable problem in broadcast media sales. Here are a few lines from the article that shifted my thinking:

The first (and biggest) problem with broadcast sales departments is how they’re organized—much more as wholesale businesses than as retail businesses. Think about it:

A wholesale business is one that:
• Sells large quantities of its products to a short list of resellers.
• Deals with third-parties, with proxies and agents, not with the end-user of the product.
• Negotiates price and terms with professional specialist buyers, often defaulting to commodity
pricing levels.
• Sells about the same thing to every customer—a schedule.
• When broadcasters deal with transactional media buyers—national, regional, or local—they are
practicing the media equivalent of wholesale selling.

A retail business, by contrast:
• Sells smaller quantities to a broad range of solution-seeking end-users.
• Learns the end-user’s needs and problems and takes responsibility for finding or developing
solutions.
• Solutions are tailored. No two look alike.
• Establishes consistent pricing for all customers, negotiating only on selected high-ticket items.
• When broadcasters deal directly with the end-user advertiser—whether there’s an agencyinvolved or not—chances are their entire approach is more like retail selling.

My experience both as a broadcast salesperson and as a provider of services to broadcast sales departments has told me this - but I hadn't put the concept into such a compelling argument.

Jim does.

Jim goes on to discuss solutions to the dichotomy of having a wholesale business with a retail customer base - I recommend that you read it carefully. You can find it here.

My contribution to this discussion is that - in many cases - this dichotomy exists not only in sales departments at radio stations, but also in the minds of salespeople. There are thousands of radio salespeople out there that know in their gut that the local media sales business is truly a retail business, yet they are forced by culture and compensation plans into selling like a wholesaler or they try to sell like a retailer to wholesale customers. These are the salespeople that you want on your team. They are probably the ones that are most likely to have the "right stuff" to succeed in this environment. And - based on my reports from the trade press, the people who remain at Clear Channel are the strong "wholesalers." The "retailers" are on the street.

Hire one or two and you'll get an immediate return on investment.

Social Media and Radio Advertising

So - in listening to a great podcast called Marketing over Coffee, I discovered an interesting example of the way a local business is utilizing social media to market their business. The example cited was a Caminito Argentinean Steakhouse in Northampton, Massachusetts. A case study was done on this restaurant by a social media marketing expert, Jason Falls. You can read it here.

How does this apply to radio?

Caminito's is exactly the kind of place that I would expect to find advertising on the radio - but apparently they aren't. They have, however, built an interconnected web of social networking connections that bring people to their restaurant. This is exactly the sort of thing that a radio station could do for a local advertiser; use the talents of your in-house web experts to build a complete campaign around radio and social networking. Use radio ads to drive people to the advertiser's social networking points of contact, like YouTube, Twitter, Facebook, MySpace, Yelp!, and so on. Provide creative ways for the advertiser to interact with their customer. For example, Caminito's has a blog that is frequently updated with cooking tips and other information that relates to the restaurant. It works because it is not pure marketing - it has value to the reader that goes beyond the pitch for the restaurant. For example, January 13th's post was on "Ten Tips for Seasoning Food." So - not only do you learn something about seasoning food, but you also get a sense of how much these guys put into their restaurant. It's really quite brilliant.  Here's one of a dozen or so videos that they created on food preparation:

[youtube=http://www.youtube.com/watch?v=9rhgpnubdjs]

One thing that radio sales teams have been brilliant at over the years is showing local advertisers how to use radio in concert with other media to produce results. Using the power of radio advertising and social networking, you'll be able to amp up the results - and make them tangible to your advertiser.

High-Tech Gear Blogger gets Nielsen Radio Diary

Nicholas Deleon, of the well known high-tech gear blog Crunchgear, posted yesterday about the KRI Armband Portable HD Radio Player. Nothing in the HD Radio review that we hadn't seen on Orbitcast, but Nicholas did had one other interesting comment:

In other radio news, my household has been chosen to be a part of Nielsen radio’s stat-tracking thing. (I received the initial “you’ll be getting a giant packaged with official Nielsen materials shortly” yesterday.) The notebook will be filled out thusly: Opie and Anthony, Monday-Friday, 6am-9am, 92.3FM; every other entry will show that, nope, this household is not listening to that drivel known as terrestrial radio. Please plan your business accordingly.

It will be interesting to follow Nicholas' posts as he experiences the new Nielsen service. Since it seems that his household will be reporting listening to only CBS' K-Rock, I guess Cumulus and Clear Channel will be disappointed. My guess is that he's being surveyed for the Westchester market - that being the closest to NYC (home of K-Rock) of the 51 being surveyed. Or - is he getting Nielsen confused with Arbitron and he'll become a PPM panelist?

Blaupunkt introduces Streaming Radio receiver at CES

Dean Takarashi of VentureBeat reports today in the New York Times that Blaupunkt, the German maker of automotive electronics, is introducing an aftermarket car radio that provides the ability to receive streaming radio via bluetooth and a 3G connection on your cell phone:

"With a push of a button, you can switch from AM/FM radio stations to tens of thousands of Internet radio stations. You can browse by country, genre, station and keyword. You can also go to the web portal with a PC and instruct your device to play only certain preset radio stations. That cuts down on the browsing time. If you don’t want to do that, you can cruise through the top 100 feature on miRoamer.com.

The radio gets its music streamed in real time via a Bluetooth connection from the radio to your 3G cell phone. I’m not sure it’s going to work, given the spottiness of 3G coverage in the U.S. But you have to give them credit for trying something ambitious. The Blaupunkt guy told me that if you’re speeding fast, you will need higher bandwidth to make sure the radio reception doesn’t get choppy. There may be a reason no one has tried Internet radio in the car before, but if it works, it’s going to change the landscape for players like XM Sirius satellite radio.

It will cost $349 to $399 in the U.S. when it ships in the second half of the year. There will be two versions, one that occupies a single radio deck in a car and another that occupies two. It’s not clear whether Blaupunkt will charge a subscription fee or will make it avaiable for free."

Now, aside from the fact that this particular implementation seems a little "Rube Goldberg," the fact that a major aftermarket car radio manufacturer is introducing such a device is a big thing.

The time is coming closer where if a terrestrial broadcaster doesn't have a strategy for streaming their audio, they will be severely impacted by lack of exposure to the mobile audience. Of course, if a broadcaster sticks to a very local strategy, then this won't matter. But - imagine a local AM station having the ability to keep a listener from awakening in the morning to bed time at night, with a signal that reaches their audience at home, in the car on their commute way outside the AM's coverage area, in the office streaming on their PC or on an IP-enabled desktop radio, on the homebound commute, and finally back at home again. Couple that with the potential for interactivity provided by IP radio and you have a potent mix.

So - where does this put HD Radio? As much as I love what some stations are doing with HD Radio, it has little to do with the technology (aside from providing more audio channels) and everything to do with content. If companies like Blaupunkt roll out streaming radio receivers for cars, what's the real advantage to a radio station for investing in HD Radio? With IP radio streamed into the car, you can have all the advantages of HD Radio without the license fees to Ibiquity. And, this advantage accrues not just to the broadcaster, but to the manufacturer as well. It appears that technology and economics may be passing HD Radio by.

Radio Advertisers - where are the retailers?

After being inundated with news about the shocking declines in sales for retailers of all stripes last week, today a report by Media Monitors shows that only 3 of the top ten national radio advertisers last week were retailers. In fact, except for McDonald's, all the rest were services. Here's the chart:

Most of these advertisers are the most successful in their categories - and those that aren't are aggressively pursuing that success. So - why aren't more major retailers on this list - during the week that can make or break sales for the year? I would have expected Best Buy, Borders, WalMart, Costco, and the hundreds of other retailers who are beating their competition - yet still suffering from the economic conditions - to be part of this list. Not for brand advertising - but for hard hitting, direct response, traffic-building advertising.

Media Monitors data is a terrific sales tool for radio; we can now take a list of advertisers using radio, with the actual count of spots that they used, and match it up against the retail growth of the advertisers. The data can be sliced and diced by market, target demographic, and matched up against real retail sales data for the market. In PPM markets, we can match up with audience data to see an estimate of how many people heard the ads and correlate that to actual sales. And - unlike post-analysis done by agencies for their clients - this information is available to anyone willing to subscribe to it.

This is a game-changer for smart radio sales people if their employers subscribe to the service. Even if they don't, there's enough public information to allow a creative seller to use the new data to solidify an argument for radio. Armed with this data, we can bring more retail advertisers into radio, show them how to achieve the success of advertisers like Geico, and then provide data on the backside that will allow tracking of actual response.