How to make us (radio) more relevant?

[Groove1670]

From All Access. We need to shake things up.

http://www.allaccess.com/talent-poo...hake-radio-up-and-just-maybe?ref=mail_roundup

 

[landtuna]

I'd be afraid to put listeners in touch with each other. Just give a look on YouTube to virtually any current hit music video and note the language (foul) and threats being tossed back and forth. Young people today, at least those interested in what they call 'music' are not civil enough or, frankly, intelligent enough to use a forum for discussion. They see it as an extension of the streets where bullying rules - no doubt imitating their favorite "artists".

 

[TheBigA]

I think the first half of his list is correct. Radio stations need to involve their listeners more in the process if they want to be relevant. At least make the effort to give listeners a voice.

The second half of the list might sound good, but there's a catch. Operating with 10% margins doesn't allow for any growth. The overhead in radio is a lot bigger than some other businesses. Having 10% margins wouldn't allow for any investment in content, and would result in even greater staff cutbacks, mainly because costs are rising at more than 10% a year.

On balance, his suggestions don't provide for any new revenue to pay for the staffing. Radio's biggest problem, especially in music radio, is that listeners want fewer commercials, advertisers want lower prices, and owners want more profits. How do you reconcile all that? I don't know, and neither does this guy.

 

[KMGX]

From All Access. We need to shake things up.

http://www.allaccess.com/talent-poo...hake-radio-up-and-just-maybe?ref=mail_roundup

Radio has so many problems and aspects working against it that it seems virtually impossible to right the ship.  First, taking a look at this list...

1. Giving listeners a way to vote on your website for songs they love and want to hear more, like JELLI -- but not as disruptive to your formatics.

Blah.  When you play about 40-50 songs max (not including a few token recurrents/golds), you basically are limiting your selection that the listeners could chose from.  Of course a consultant would use these numbers to further justify playing the same few songs over and over again---thus it's self feeding, it ultimately doesn't help the business and only harms your product ultimately. 

Allowing listeners to "meet" other listeners on your website who love the same songs they do, and to "chat" with each other in real time, building a true social community.

Most radio stations have facebook pages and twitter accounts and this is---to some extent---already being done.  If you're talking about setting up a chat protocol specifically for the station's website, one that doesn't use facebook or other social media, I suppose that would be okay but good luck getting listeners motivated to go there.

Creating a product listeners will talk about, every daypart, every day. Hint: This won't happen playing researched music with voicetracked liners.

Amen to that!  Unfortunately, most people that are in management type positions in this business are boxed in to the same old rubric; silly hacky contests and bits that require minimal thought, are unoriginal and require little effort.  Truthfully, you need to bring in more talent, allow more creativity and have more personality on your stations. 

Let's face it, if people just want to hear music, they're not going to listen to the radio anymore, that's antiquated thinking.  Do what talk radio used to do, throw in some unique, thought provoking personalities, mix up the music a bit, give listeners the feel that they actually can identify with the personality, the station and the music.  I know from experience that telling these things to a PD or GM is literally a waste of time and oxygen. 

4. Offering listeners who like discovering new artists and songs a way to hear them on your station website before you have to commit to giving them air time.

Maybe... not sure a record company executive would like that though. 

5. Building a permission-based e-mail club of individuals built around themes that you can personalize and super-serve, like book clubs, cooking, parenting or new music discovery.

Sounds like spending money on a web development team that could be better spent on the on-air talent.  Let's remember, we're talking about a RADIO STATION here.  The on-air product---which has been suffering for most stations over the last two decades or so---is what matters most and should be the primary focus. 

6. Completely redesigning your website for users, not for banner ads and company clutter, and funding it so it features great, fresh video content every day.

I don't disagree with this, but stations have to squeeze out that extra revenue and there are agreements with regard to ad placement and whatnot.  You can't simply shove all the ads into one corner, it doesn't work that way unfortunately.  Nevertheless, most stations sites could use a bit of a redesign, although I'm of the opinion that simpler is better. 

7. Discussing the harm that over-commercialization and clutter have caused to listening with the same sense of urgency that PPM has brought to jock talk and personality shows.

The amount of clutter is overwhelming these days---even a legal ID for a station, "From the blah blah blah incorporated studios, this is [positioner], [call sign], [city]"  Ugh. 

8. Learning to be happy with 10% returns, a profit margin almost every other industry would be giddy about, and investing all the rest in creating stronger content.

Agreed completely, but greed has been killing this business for some time and it will continue to do so until all the money has dried up. 

9. Hiring one PD for each station in every Top-100 market.

Absolutely!  Totally will never happen but I agree here as well.  Part of radio's problem also stems from homogenization---the same music, the same imaging, the same sound on virtually every station in every market that [insert company] owns.  KISS-FM sounds the same in Phoenix as it does in LA---for the most part.  To have the ideal scenario of one program director for every station in a top 100 market you also need to stop using music consultants or, at the very least, understand that they are not the end-all-be-all in the business when it comes to knowing what songs to play, etc. 

10. Firing your VPs of Programming, Marketing, and Operations who inevitably do far more harm than good. Use the money saved to fully staff your stations.

A broad statement, but mostly true.  Some of the marketing people are actually good folks, but they are bound by corporate policies and mostly have their hands tied so they can't develop better promotional/marketing strategies for the stations---aside from the same old boring concepts. 

11. Restoring real control to every local market GM and PD. If they can't run their stations successfully, replace them, but first give them a chance without corporate meddling and politics.

This, again, falls into the homogenization category.  Every Clear Channel station (for example) has to have the same website, the same over-produced imaging (listeners don't care about imaging usually by the way), the same music, the same branding/positioners---blah!  Let a PD decide what's best for their market, stop making them nothing more than puppets for a corporate consultant. 

12. Firing the robber barons who have bankrupted our biggest radio companies, fired our most valuable talent, and distinguished themselves only for their greed and inability to generate one creative thought on improving the product we want listeners to consume more often.

Good luck getting rid of bean counters and greedy executives.  Now, not ALL executives are greedy, but there needs to be a thorough house cleaning throughout the industry and it's got to start from the top.  Ironic, too, is that the greediest ones are the ones killing the business the fastest and their won't be much money to be had at the current devaluation of the business. 

There's a lot that this industry could learn by talking to it's listeners and listening to feedback from the few people that still have quite a passion for the biz such as myself, but pride and smugness seem to win out ultimately and the clock is ticking on the final years of this industry if it cannot adapt and try to make itself relevant again. 

 

[Goat Rodeo Cowboy]

Operating with 10% margins doesn't allow for any growth. The overhead in radio is a lot bigger than some other businesses. Having 10% margins wouldn't allow for any investment in content, and would result in even greater staff cutbacks, mainly because costs are rising at more than 10% a year.

This strikes me as an area where the radio broadcasting industry has lost it's credibility.

The corporate profit after all the sifting and shuffling is thin. It's a way of avoiding paying taxes. It's a way of building your empire by paying dearly to "rent capital" from the venture capitalists.

I've talked to too many brokers, read through too many ads, had too many conversations. OPERATING COSTS to do radio today are about 45% to 55% of revenue. Any station manager and sales manager not delivering that kind of cash flow at the station level finds his/her job in jeopardy.

We take all that cash back to corporate where we pay interest on more money than we should have borrowed, we pay the expenses on a better corporate jet than we really needed, we pay dues and contributions into political groups that pretend to be trade groups, we set up fine executive retirement plans and then we cry the blues about being a low margin industry. (I think I may cry. : )

Broadcasters get to, have to, talk shop with people in other industries. Broadcasters help people who own and manage businesses figure out how to fit an effective advertising and merchandising expense into their budgets. Some of those people can tell us tales of low margin businesses that make broadcasting look like a cash cow and pot at the end of the rainbow in comparison.

 

[davideduardo]

I've talked to too many brokers, read through too many ads, had too many conversations. OPERATING COSTS to do radio today are about 45% to 55% of revenue. Any station manager and sales manager not delivering that kind of cash flow at the station level finds his/her job in jeopardy.

Here is where I'll disagree.

First, operating margins like 45% to 55% are gross margins... revenues less operating expenses. But they are before taxes, amortization, depreciation and interest. In other words, a station, even without debt, with a 50% margin is going to have a net profit that is less than 20% after taxes and depreciation.

And those 50% margins are far less common today than pre-recession. You will find them only at the larger market levels or among a few market-dominant stations in medium and smaller markets.

If you look at the sale announced this week of the Sandusky stations, you see a group of 10 stations going for $85 million. That sale is about double the gross revenue of the stations, and about 8 times Broadcast Cash Flow by my guesstimate. That means that on $42 million of revenue in two top 20 markets, they are cash flowing about $9 to $10 million. That's a margin of about 20% to 22% with some market leading stations. After taxes and depreciation and amortization, they likely are making about 10% to 15% on their money...

When we get down to looking at all radio stations across the country, historically half have made no money at all. Of course, many of the smaller stations that show no profit are paying a sole proprietor a nice salary, but overall the margins are not in that high, high range and in fact in many cases they are no better than investing in some nice mutual funds!

 

[davideduardo]

Blah. When you play about 40-50 songs max (not including a few token recurrents/golds), you basically are limiting your selection that the listeners could chose from.

The reason why "Top 40" has been successful as a radio (and now, streaming) format since 1952 is that lots of people want to hear the current hits and they like a station (AM, FM, satellite or stream) that is always playing a big song every time they listen.

The reason why those stations play "so few" songs is that, at any given moment, there are really, truly no more significant hits in any genre... be it pop or r&b or regional Mexican.

Creating a product listeners will talk about,

Amen to that! Unfortunately, most people that are in management type positions in this business are boxed in to the same old rubric; silly hacky contests and bits that require minimal thought, are unoriginal and require little effort. Truthfully, you need to bring in more talent, allow more creativity and have more personality on your stations.

One of the most successful radio formats ever, Beautiful Music, had a 20-year run at the top with little if any "word of mouth", insignificant contesting and voicetracking all day with no personality.

Not everyone wants contests, jocks and the unfamiliar. Goes for laundry detergent, radio stations and cars alike...

Let's face it, if people just want to hear music, they're not going to listen to the radio anymore, that's antiquated thinking.

Actually, if you consider "radio" to be any method of distribution, they are listening.

Radio's problem, and the error of your entire analysis, is thinking that it is in the AM and FM transmitter bushiness. If streaming is given equal priority, then radio will make the transition; plenty of people want a well programmed "stream" of their favorite kind of music without the hassles of making a playlist or trying to get an adaptive customizable stream to really reflect what they want to hear.

Radio has competed with various kinds of "music players" for half a century or more... granted, today it is easier than ever to carry a music playlist with you... but there is definitely room for "radio" once the transition to mostly streaming is further along.

...give listeners the feel that they actually can identify with the personality, the station and the music. I know from experience that telling these things to a PD or GM is literally a waste of time and oxygen.

Perhaps you need to consider that many / most listeners today don't want yapping personalities, or only want such a creature at certain times of the day.

4. Offering listeners who like discovering new artists and songs a way to hear them on your station website before you have to commit to giving them air time.

Maybe... not sure a record company executive would like that though.

Record companies love exposure to new artists on station website, side channel streams and such. Many of the larger broadcast companies already do this in a number of forms.

Building a permission-based e-mail club of individuals built around themes that you can personalize and super-serve, like book clubs, cooking, parenting or new music discovery.

Sounds like spending money on a web development team that could be better spent on the on-air talent. Let's remember, we're talking about a RADIO STATION here. The on-air product---which has been suffering for most stations over the last two decades or so---is what matters most and should be the primary focus.

You are stuck in the transmitter business.

Listeners are not. It's all about streams and rich content delivery with graphics, links, etc. that accompany the audio.

Over 60% of American adults have bought a new smartphone in the last 2 years. I'll bet the percentage who have bought a new radio is less than 5%.

Learning to be happy with 10% returns, a profit margin almost every other industry would be giddy about, and investing all the rest in creating stronger content.

Agreed completely, but greed has been killing this business for some time and it will continue to do so until all the money has dried up.

The "profit margin" of radio, as a whole, is less than 10% already. Only a select few stations have fat gross margins, but even those major, major stations don't have a profit margin much above 25%. And that is way less than Apple's margins, by the way.

Part of radio's problem also stems from homogenization---the same music, the same imaging, the same sound on virtually every station in every market that [insert company] owns. KISS-FM sounds the same in Phoenix as it does in LA---for the most part.

Actually, you picked a horrible example. "KISS" is a brand, not a format. There are urban variants, CHR variants, Churban variants with different implementations in each market. The brand is consistent because it is so hard to find a brand today that is not covered by service marks, so companies will claim a couple of names and use them in lots of markets on different stations.

To have the ideal scenario of one program director for every station in a top 100 market you also need to stop using music consultants or, at the very least, understand that they are not the end-all-be-all in the business when it comes to knowing what songs to play, etc.

Huh? What is a "music consultant"?

At most significant stations, the "music consultants" are the listeners and their feedback, via everything from music testing to MScores, is what determines airplay.

This, again, falls into the homogenization category. Every Clear Channel station (for example) has to have the same website, the same over-produced imaging (listeners don't care about imaging usually by the way), the same music, the same branding/positioners---blah! Let a PD decide what's best for their market, stop making them nothing more than puppets for a corporate consultant.

In reality, America is a homogenized nation. NCIS is the #1 show not because it overwhelms in one market alone... it does well everywhere. Much of America followed Idol for a decade, and everyone knows the duck call family and the pawn brokers. Why, if we consume video entertainment in like form from Oahu to Orlando would radio stations not be just about the same from Nome to Nashua?

There's a lot that this industry could learn by talking to it's listeners

Millions and millions are spent each year finding out what listeners like and don't like, both by syndicated research and proprietary projects.

and listening to feedback from the few people that still have quite a passion for the biz such as myself...

You are recommending things that either don't apply to everyone (personality jocks, etc) or are mistaken (thinking it is wrong for an AC in Atlanta to play about the same things as one in Denver) or that don't reflect a changing reality (you recommend spending more on jocks and less on websites).

AM and FM as distribution channels are on the wane. "Radio" is not.

 

[TheBigA]

Part of radio's problem also stems from homogenization---the same music, the same imaging, the same sound on virtually every station in every market that [insert company] owns. KISS-FM sounds the same in Phoenix as it does in LA---for the most part.

When talking about music radio, it always comes down to music, and the key thing to say is that radio stations are not in the music business. No radio company today owns a record label, signs artists, or promotes music. Radio stations take music that is made by other companies and plays it. The fact that it "sounds the same" is a subjective comment. But there's nothing radio stations can do about it. They're simply playing what's popular. We don't live in a regionalized country anymore, where people in Phoenix don't know about what's happening in NYC. If it's happening, it's transmitted on some form of media, and within minutes, everyone knows. So to create a localized radio station that only focuses on the music and culture of that town won't be popular with an audience that has access to the world. It's the job of radio programmers to immerse themselves in their format to the degree their listeners are, and that's not easy.