Clearly Conflicted

[TheBigA]

Sales people have limited time - especially now that several of the larger corporate entities have dramatically increased reporting requirements.

That wasn't the question I asked. It sounds like you're making excuses, rather than telling me how to increase revenues without increasing inventory or spot rates.

 

[TheBigA]

If you want new business on that platform, hire sales people to sell it.

Some companies are.

 

[umtrr-author]

This company's endgame is iHeartRadio...

To which I'll add a data point that isn't in the CC report:

100% of me couldn't get iHeart Radio, for the Red Wings Game Tuesday night, to work for more than 90 seconds at a time, while driving along the Thruway between Syracuse and Rochester. This is an area that is saturated with cell coverage.


That figure for iHeart was zero seconds at a time along I-81 between Binghamton and Syracuse, but I can't say I'm surprised by that.

I held my nose and listened to "thuh" Yankees on WCBS instead.

If iHeart is really their future, I'd be really worried at present if I were a stockholder.

 

[Element9]

Good observation, train man. iHeart Radio also has issues in local non-mobile applications using high speed connectivity. The Internet pipeline is only so large, traffic clogs access. There are a number of issues that remain to be worked out, whether using Pandora or Spotify. In reality, Internet access isn't free because we pay for access to and use of bandwidth. Consumers will always go to what's easiest and most accessible. In large measure, now and for the foreseeable future, that means local RF, which is "free" with commercials or underwriting announcements. This is a major win for OTA radio. You'd think some of these radio companies would understand a simple concept: "Dance with the girl who brought you." Instead, shareholders and customers get a song and dance pony show from CEO's.

 

[radioray]

The way to increase revenue is to increase rates. Raise prices.

The way to increase rates is to make it so you have to increase rates by being sold out. You need to be in demand. So in demand that you are sold out.

The way to be in super demand is to be number one or two or three in your market.

I am convinced that the most sure way to do that is with well trained and compensated live and local talent. I own radio stations and I do NOT think I am pissing money away by having live jocks.

But live jocks or not I find it utterly absurd to eliminate production people who can make you spec spots to present to clients. I mean, that is just nutso. That is the absolute last place I would cut. There is nothing (apart from phenomenal ratings) better for sales than a terrific spec/demo spot that the client can hear and imagine being on the air on the station that "everyone listens to around town".

The way to raise income is to raise rates. Stop cutting production and programming people. You will make the money back.

I've owned stations for over 20 years and it still works for me in markets small and large.

 

[JustPastBuffalo]

You have to like an owner who values production people and jocks who can do good production. 8)
_________________________________________________


There was a time when production people had the time and latitude to do what were called "chutz spots." Chutz (taken from the Yiddish word "chutzpah," meaning "nerve" or "gall") spots were funny, bawdy, bold, occasionally obscene, often contained inside lines and always over the top shtick. Think "Mel Brooks meets Richard Pryor meets Robin Williams meets Albert Brooks." I first observed, heard of and produced chutz spots working with Don Berns, Norm Schrutt and Jeff Kaye. To write, produce and deliver a good chutz spot required a keen understanding of (borscht belt) humor, real life experiences, inside information about the client or his direct competitor (who he often despised) and... a whole lotta chutzpah.

The spot had to be the right fit for the client/person who called the shots on the buy. Very often, the radio sales person (let's face it, usually a guy) would write some or all of the spot and work with the production person who'd produce it. It could be a "big production" or a one take, off-the-wall, half-libbed stream of sales hype. A lot of times, the tape just rolled and be edited. (One of the most memorable chutz spots I've heard was done by a Rochester production guy for Paul Rosa's stores. To this day I still remember one of the lines.)

The sales guy would then take the spot to the client and with a straight face say something like, "I took all the points about your business that you gave me and worked with my production people. (It was never 'one person,' always 'production people.' We run a big shop at our station.) Here's what we came up with." Press play. 90% of the time, the client/buyer loved it, so much so that the radio sales guy had to convince the buyer that the chutz spot couldn't be used on the air. You knew it was a good chutz spot if/when the client played it for two or three other people in the store, shop or car dealership.

After everybody had a good laugh and things calmed down, the actual radio spot would be played. The sales person almost always walked out with a signed contract. For his work, the production guy usually got a dinner gift certificate and maybe a talent fee if the spot traveled, which usually was the case, because the client would say "I want to use the spot WXXX produced."

One thing I learned watching the pros who proceeded me and working with some of the heavy hitters in radio sales and passed along to other production people: "Never ask the client if he/she liked the spot. Always say, "isn't that commercial great! Here, let me play it for you again." When I put demo/specs on cassettes, they always were put on twice, with a three second gap between. The sales guy would never have to rewind the tape, only press and release 'pause.' Again, most times he/she walked out with a signed contract.
***
Yes, this is old school stuff. These are different times, but local-direct is often relationship based and there are factors that still apply to selling the product and renewing the contract. It's still about people as much as it's about CPM.

 

[TheBigA]

The way to be in super demand is to be number one or two or three in your market.

So how do you justify personnel expense when you're #8 in a market? With live & local talent?

 

[radioray]

I work hard to make number 8 number 1. Just had a consultant visit in one of my markets a few weeks ago. It takes time. I am willing to be patient. If not, a new PD may have to be found or we are in the wrong format. Time for a market survey in that case.

But that was not the original question, was it? It was how to raise your revenue. I remain sold on the "by raising your rates" side of the argument. And one way NOT to go is cutting production staffers.

 

[TheBigA]

But that was not the original question, was it? It was how to raise your revenue. I remain sold on the "by raising your rates" side of the argument. And one way NOT to go is cutting production staffers.

You can't raise your rates when the marketplace views radio spots as overpriced when compared to CMP of other media. And you can't raise your rates when increased competition keeps your station from the top of the ratings, regardless of your staffing.

 

[TheBigA]

Yes, this is old school stuff. These are different times, but local-direct is often relationship based and there are factors that still apply to selling the product and renewing the contract. It's still about people as much as it's about CPM.

You want to talk old school? There was a time when we'd compose and produce jingles for local spots. Go to a studio, with singers and musicians, and come up with a jingle. This isn't Coke, we're talking a local hardware store. They didn't have an agency. We did it ourselves. Of course there aren't many local hardware stores any more, so that's how dated that idea is. Today the local Ace Hardware affiliate gives you a donut from the agency, lay a local VO on to, and that's your spot. You don't need a staff of people to do that. I've had local advertisers deliver their own produced spot that is national quality, done in-house without an agency. Creating radio spots isn't as hard as it once was.

 

[radioray]

"You can't raise your rates when the marketplace views radio spots as overpriced when compared to CMP of other media. And you can't raise your rates when increased competition keeps your station from the top of the ratings, regardless of your staffing."

I am not sure of what you mean by increased competition keeping me from the top of the ratings. In none of my markets have new stations been assigned recently.

You can't raise your rates when the marketplace views radio spots as overpriced. Hahaha. CLASSIC sales excuse. They come to me sniffling about how tough to sell at these rates. I threaten to raise them by 30% and all of a sudden it is not so hard anymore. Sales people always want to peddle low cost product because it's the easiest way. It is up to management to take the long term view and refuse. Or to be so popular and sold out that the client has to act now or lose out. That is the best option and what I expressed above.

Hire this guy, he's worth it (I am not him, but I like him)

http://www.paulweyland.com/video.html

 

[TheBigA]

I am not sure of what you mean by increased competition keeping me from the top of the ratings. In none of my markets have new stations been assigned recently.

You own a small market station in Texas. Not Buffalo. Very different situation. Buffalo has more stations in the market.

You can't raise your rates when the marketplace views radio spots as overpriced. Hahaha. CLASSIC sales excuse.

Once again, small market radio. In small market radio, advertisers don't buy based on CPM.

 

[radioray]

You have me confused with someone else.

 

[TheBigA]

You have me confused with someone else.

Maybe. How big is your market?

 

[SirRoxalot]

If you knew the local market, you'd know that there are a lot more relational sales in Buffalo than there are transactional sales. Yes, some agency buyers want CPP in specific demos, but that's not the only measure that goes into a buy if there's an established a relationship with the agency and/or the customer. Results matter, and top-of-mind stations clearly get better results than background stations.

A lot of advertisers have dabbled with on-line media, but most of that money is coming from the old Yellow Pages advertising - which is pretty much history now. Smart radio stations are going after that money, not diluting their OTA budgets with on-line buys that cut into their bread and butter.

Farid was of the opinion that "radio sells itself" and that all that were needed were "order takers" - particularly in renewals. Well, we see how well that worked out for the former Citadel stations. Cumuless has added layers of adminsterial complexity to that attitude, and chased away a lot of sales talent. The experienced people left are doing well, but the empty cubicles represent lost opportunity for young talent to either expand the advertiser base or reach out to advertisers who can't afford OTA radio, but could afford commercials on the streaming media.

The fact that advertisers CAN produce their own commercials more easily now doesn't mean that they turn out quality. Plenty of dreck comes attached to e-mails that simply shouldn't air - and some of that comes from national barter deals.

Even IF - and I do mean IF - streaming radio eventually overtakes AM and FM delivery, the emphasis on content still needs to remain local according to Clear Channel's own study. Local makes a difference, and live and local creates winners.

 

[TheBigA]

It's not a one-or-the-other thing. That gets back to your subject line. There is no conflict if it all benefits the same bottom line. You want CC to devote all attention to on-air. They can't. Radio companies need to become MEDIA companies. In doing so, they become more connected with their listeners and their advertisers. The way to become engaged with listeners is through interactive media. The way to demonstrate that you're engaged is being able to turn out tens of thousands of contest winners to a concert. That's what WYRK will do next month with their Taste Of Country concert. They are using both on-air and online to make it happen. Same thing with CC and their IHeartRadio Festival. They now have an above the line sponsor for that event. The relationship with artists for that festival has given their radio stations unique content to talk about on-air. It also gives them access to artists to do an amazing TV ad campaign with Festival stars promoting the local radio stations. Once again, there is no conflict. You HAVE to do it all. That's ow you build relationships. That's how you build equity. That's how you build a brand.

 

[SirRoxalot]

If all that you say is true, then your advertising SHOULD be worth more, and your premise that radio advertising is overvalued simply doesn't fly. And, if you're going to get this "superior content" on the air in a way that's MEANINGFUL TO LISTENERS, you need production people and air talent to give it context and local relevance. It's not a question of devoting "all their attention to on-air." It's a question of not cutting more production people, air talent, and sales positions, then complaining about "lack of growth". On-line should be additional revenue, not a dilution of the product that brings in 90% of the dollars.

 

[TheBigA]

If all that you say is true, then your advertising SHOULD be worth more, and your premise that radio advertising is overvalued simply doesn't fly.

It's a process. It took two years for CC to get a sponsor for their festival. They're BUILDING value. It's not there yet. Plus radio has this negative hurdle to get over among advertisers who think no one's listening.

And, if you're going to get this "superior content" on the air in a way that's MEANINGFUL TO LISTENERS, you need production people and air talent to give it context and local relevance.

Maybe. In the advertising world today, the goal is to have your message "go viral." That's not having some local DJ talk about something between the songs. It's INTERACTIVE media , where the LISTENERS get involved and become part of the story. Forget the top-down thinking, the "us and them" approach to radio.

On-line should be additional revenue, not a dilution of the product that brings in 90% of the dollars.

You keep equating quantity with quality. It doesn't matter how big your staff is. What matters is the result. I've worked at stations with small but energetic staffs, and we've kicked the tails of the big, bloated overstaffed station. You need that kind of energy now. As I've said, OTA radio has topped out. That's a fact. You can't grow the audience beyond what it is. The best you can do is steal from someone else. That's not growth. Radio needs to look beyond the old stereotypes. More teachers don't make smarter students, and more on-air people doesn't mean more revenues.

 

[SirRoxalot]

There are plenty of studies that refute the idea the "no one's listening". Wasn't that the point of the PPM? The only people who have that "negative hurdle" are those who haven't talked to a good sales person prepared to show them how they're perception is wrong.

It will be tough for radio to get more listeners since they already reach 92% of the market or more. It shouldn't be tough to get some of that old-media money that went from newspaper and yellow page advertising to on-line media when advertisers don't see much return on their investment.

Nothing "goes viral" locally faster than what some local DJ talks about between songs IF the content is compelling. "Interactive" means that people HAVE to access it and respond to it. Radio doesn't require the response part - which is why it remains strong, particularly in environments where interactivity is problematic, like in the car and in the office. TALENT makes listeners FEEL like they're part of the story IF they have the chance to communicate something other than liners and positioning statements. Clear Channel's own study says that.

Lastly, you can challenge a bigger organization that's gotten fat and lazy, but those organizations are few and far between. Mostly, now, people are trying to maintain quality with half the people that they had when they built the product into what Clear Channel, Cumulus, or the other consolidators purchased for stupid amounts of money before 2008. You simply can't maintain that quality with half the staff over the long haul.

Radio needs to look at what got them to the dance, and put their money into the things that are most cost-effective in bringing dollars through the door. That, BTW, is OTA radio.

 

[TheBigA]

There are plenty of studies that refute the idea the "no one's listening". Wasn't that the point of the PPM? The only people who have that "negative hurdle" are those who haven't talked to a good sales person prepared to show them how they're perception is wrong.

Have you ever spoken with an advertiser? A "good sales person" wants to make a sale. Advertisers don't believe radio sales people, regardless of the facts. They're biased. That's what this CC study was supposed to help. But it probably won't. You can show them all kinds of studies and facts, and they'll tell you stories about how their kids and friends don't listen. I've heard it all before.

It shouldn't be tough to get some of that old-media money that went from newspaper and yellow page advertising to on-line media when advertisers don't see much return on their investment.

You're welcome to try. Where I am, it's all about the numbers. How much audience can you deliver for how little money. That's all they care about. If the numbers don't work, they're gone. They want a plan that incorporates social media and interaction. If you're just selling spots, they can get that anywhere.

Radio needs to look at what got them to the dance, and put their money into the things that are most cost-effective in bringing dollars through the door. That, BTW, is OTA radio.

Cost effective? When you compare CPM side by side, most radio is overpriced. Spend a week in sales. It'll open your eyes.