One thing WGN did that was smart was have custom apps made for the iPhone, Android, and Blackberry. The next generation of WGN listeners will be listening online, either through one of these apps or on their laptop's media player, and not as much on AM 720 (although they certainly won't be turning that transmitter off anytime soon).
But if they're serious about attracting a younger audience for something other than sports, they'll have to abandon the more geezer-friendly programming (at least that midday suburbanoid-drivel from Kathy & Judy is gone!). But there's no reason they can't remain 100% Chicago unless the ad base just dries up and they just can't afford to do it anymore.
BTW, the Android app works great! Can't speak for the others as I don't have an iPhone or Blackberry. These smartphone apps, either single-station ones like WGN or WBGO, or multi-station apps like StreamFurious (it has most, if not all, public radio stations in the US, plus ShoutCast), are the way to go - especially if an AM station can't get on FM like WGN (which is, of course, meaningless in the online world).