Branding Ad Vice

A Look Into The Crystal Ball

It’s dangerous to try to predict what any specific technology will look like even 5 years in the future.  It’s safer to look at trends.  My many friends in radio have spent a great deal of time in the past few years worrying about the impact “satellite radio,” and the more recently launching HD Radio will have on the size of their listening audience.  I don’t believe the future challenge lies with either of these technologies. 
A recent article in USA Today offers a glimpse into the future.  The combination of internet access in automobiles and WI-Max (wide area wireless internet access) or something even more advanced will put a whole new world of listening experience in the hands of drivers.

There are over ten thousand on-line radio stations available right now from sites like Live 365 and a nifty program called Pandora allows you to custom build your own radio station.  While no one station may ever attract have a large audience, if each station only claims a few listeners in each market there’ll be a lot few listeners listening to “traditional radio” in the future.  And that’ll make it much more difficult for advertisers to reach a large audience easily.

I don’t consider myself an early adopter by any means.  But I spend most of my time listening to WCPE out of Raleigh Durham, NC (a “traditional” radio station with a large Internet presence).  I could listen to a classical station out of Milwaukee or Chicago, but I like WCPE and I listen everyday online.  What’s neat is that no matter where I go I can listen to the station as long as I have Internet access.

I’m also a huge fan of Old Time Radio (go figure) not a huge market for radio shows produced 50+ years ago.  I’ve got 3 stations bookmarked in ITunes.  Who knows how many people will tune to old shows in their car when wireless Internet becomes available? “The Shadow Knows.”

Statistician Spin Cycle

In a recent post I questioned the conclustions of an analysis of the Winter ratings that satellite radio had minimal impact on local radio, because persons using radio (PUR) hadn't changed overall.   "Taint neccessarily so" says Arbitron.  PUR includes terrestrial and satellite listening.  The numbers reported by Radio Business Report (RBR) today shows a healthy trend upward in satellite radio's audience.  Seems to me that an increase in satellite listening without an increase in PUR means that some local radio stations took a hit. 

Years ago I was trout fishing on the Middle Fork of the Stanislaus River in the Sierras.  The river, fed by heavy rainfall higher up, rose from mid calf depth to thigh depth in a matter of minutes without me noticing it.  Luckily my observant wife on the bank suggested that I start paying attention before I got swept away in the current.  If you don't pay attention and react to trends you could find yourself in over your head too .

Arbitron Analysis Nonsense

Ratings release season is upon us again and the statisticians are out in force.  According to a story from Inside Radio:

“No significant loss of listeners to satellite” from  (Howard) Stern’s defection.

Katz researcher Maggie Hauck says “Howard Stern listeners have stuck with terrestrial radio despite all the hype.” They mostly turned to new options on the AM/FM dial. What Katz finds is that the total audience — Persons Using Radio — didn’t shrink in the Winter Arbitrons released yesterday. It was off 2% in New York, Long island and Chicago, and 1% in L.A.

Persons Using Radio isn’t the issue. Let’s look at the time spent listening trend.  Is there a difference between 1,000 people listening for 2 hours and 1,000 people listening for one hour when it comes to advertising?   The lower the time spent listening the more difficult it becomes to reach a radio listener with adequate frequency. 

And even though the number of people using radio in New York, Long Island, Chicago and L.A. are down, advertisers in those cities may take solace from knowing that overall, the audience didn’t shrink.

I am reminded of a quote from the late Dr. Neil Postman in "Technopoly."  “We must keep in mind the story of the statistician who drowned while trying to wade across a river with an average depth of four feet.  That is to say, in a culture that reveres statistics, we can never be sure what sort of nonsense will lodge in people’s heads.”

Radio – Working Hard Or Hardly Working?

The Radio Advertising Bureau (RAB) is out with “If It Works, Don’t Ignore It,” a print campaign touting the medium as an essential advertising tool created by New York ad agency DeVito/Verdi, which also created the absolutely brilliant campaign for the National Thoroughbred Racing Association. (Dinner Date )  We’ve all experienced situations similar to those presented in the NTRA campaign.  In other words we can relate to the campaign.  That can't be said for the "Works" campaign.

I am not bashing radio advertising.  When done right – radio advertising is a beautiful thing.  As a matter of fact, I’m currently working on radio ads for about a dozen or so advertisers. But while the ads are clever but they don't prove that radio “works.”  One ad touts "radio delivers a 40% greater return on investment than television ."  Well maybe – if you read the study, you'll find that the statement is technically true but the conclusion is based on a seriously flawed experiment.  Another "Works" ad states that "Radio reaches 298 million people every week."  So what?  This is totally useless information unless you're playing Trivial Pursuit.  It's like saying that as of  1313:19 GMT (CST +6) April 14, 2006 the population of the United States was 298,515,373.  How does that prove "Radio Works" and what are the other 515,373 doing with their time?

But hold the phone. What exactly does the word “Work” mean?  In my briefcase toting, radio salesperson days of the early 80’s, I’d happily march into a businessperson’s office proclaiming “Radio Works.”  Sometimes I’d get the sale, run the ads – then be told by the advertiser that it didn’t “work.  It took more years than I’d like to admit before I started asking advertisers what “work” meant to them. 

Making radio (or any media) work isn’t simple, but it’s fairly straightforward.
1)    Define the client’s definition of “work” (what has to happen).
2)    Develop a strategy to make it happen
3)    Create a powerful campaign combining effective reach, frequency and a meaningful message.

Using this formula, I've seen radio “work” fabulously well for hundreds of advertisers.   That being said, I’m fairly sure that most agency people don’t ignore radio because it “works.”  They ignore it because in many cases it hasn’t “worked” for their clients, studies and statistics not withstanding.  Will splashy ads in trade magazines change this reality?  No.  So dump the print campaign and the useless facts and figures.  Instead launch an updated radio campaign similar to 1985's  "Plummet Mall" campaign in Cincinnati (Pages 33-35).   

HD Radio It’s Not Easy Being Real

Clear Channel Radio’s Creative Services Group has released a series of ads promoting HD Radio.  The campaign entitled “Are You Def Yet?” features some well produced ads that for the most part miss the mark and will fail to move the needle toward acceptance of HD radio.

HD Radio for the uniformed (which is most of us) is a new digital broadcast technology providing improved the sound quality and allows multiple stations to broadcast on a single signal.  There are only a handful of radios currently available that can actually pick up these signals and only a handful of radio stations broadcasting in HD. 

We are in the 3rd year of a new generational mindset, a mindset that rejects hype and cries out for truth.  This is where most of the ads in the campaign fail.

Several of the ads compare the lyrics the typical teen listener would hear to what their parents hear.  For example the lyrics of a rap song are interpreted by adults as “sex, sex, sex.”   The ad goes on to say  “And that’s why your parents don’t want you to have an HD Radio.”   Huh?  Exactly what percentage of parents would ever say “I don’t want you to have an HD Radio?”   Pretty close to zero. 

So let’s be real.  New HD stations are regulated by the FCC the same as all other broadcast stations.  In other words even though the sound may be clearer listeners won’t hear anything different than currently available on the radio.

Another example is “The Rural Rump Slap Rap” with lyrics that mention “I’m White Trash and I’m slapping (you get the picture)”  again with the promise that you can’t hear that on regular radio but you can on HD.  Uh, not likely.   When early adopters turn to HD Radio in search of something radically different and aren’t able to find it word of the fraud will spread like wildfire. 

Having been assaulted by hype and empty promises for 40 years consumers have grown weary and wary.  When our internal BS meters detect phoniness our mind shuts out the offending message.   Cute, clever and creative are poor substitutes for real, salience and truth.

The problems with the HD Radio ads are heard everyday in ads for all types of businesses.  If your advertising isn’t working as well as it did 4 or 5 years ago it mos def be that you’re still relying on the power of the delivery rather than the power of your message. 

Get Real

If you’re in the Radio Business and aren’t reading Mark Ramsey’s “Radio Marketing Nexus,” you’re missing out on one of the most insightful guys in the business.   His recent post, “How To Embarrass Yourself” is right on the money.

The typical “Tween” spends less than 40 minutes a day listening to the radio.  So the likely hood that these kids are listening to FM on their iPods is a real stretch.  The real issue is how a radio station can make itself relevant to its audience.  40 minutes a day is pathetic. 

There are storm clouds on the horizon and everyone from advertisers to agencies to radio stations knows it. But the lessons apply to all businesses.  Just because you say it with authority doesn’t make it true. Hype and BS are poor substitutes for realism and gritty truth consumers demand.

Every Generation Throws A Hero Up The Pop Charts

The number 10 Album on this week’s Billboard Top 200 hasn’t received any airplay on the 1,000 or so radio stations that factor into the chart.  “High School Musical,” the Soundtrack to a Disney made for TV movie also placed nine tracks in the Billboard Hot 100 (more). 

Forty-five percent of the album’s sales came from digital retailers.  That’s 24,000 sales and 341,000 downloaded tracks.  This may not represent a torrent of change but it’s a good-sized stream.  So much for the National Association Of Broadcaster’s “You Hear It Here First” marketing campaign (NAB).

I’m not saying that traditional radio is in danger of losing relevance (well actually I am), but this story brings up one of the most common questions advertisers ask.   "What impact will satellite and iPods have on my radio advertising? " My short answer is, “More choices equal more fragmentation equals smaller audiences."  But all things are seldom equal and frankly the vast majority of local advertisers could increase the return on their advertising investment even in the face of smaller audiences.

Consider the following equation:

Return on Investment = Audience x Schedule x Message Impact.

Let’s assume that the size of the audience will shrink.  You can still improve the return on your investment by improving your schedule and your message.  Even today you don’t have to advertise on the biggest stations to get results.  With the right schedule and message you could successfully advertise on a station featuring post-modern Lithuanian orchestral music (sample).

So don’t worry about tomorrow.  If your message and schedule are anemic, you aren’t seeing the results you deserve today.  But you already know that don’t you?

The Times They Are A Changin'

Google just announced that they will pay upwards of $1.136 billion over the next 3 years to buy dMarc Broadcasting, Inc.  In the future, Google said it plans to integrate dMarc technology into the Google AdWords platform, creating a new radio ad distribution channel for Google's advertisers.  more

This could make things interesting.  Better sharpen your writing skills.

It's Content Not Delivery

Radio is near and dear to my heart. Not the radio industry but those faraway radio stations I fell asleep listening to as a teenager. Not the radio industry but the radio stations I worked for thirty plus years before I struck out on my own. I love radio that is why it breaks my heart to watch the radio industry’s battle with satellite radio.

I had the opportunity to listen to samples from the new campaign the National Association of Broadcasters is about to roll out. “Radio, you shouldn’t have to pay for it.” I shouldn’t have to pay over two dollars for gasoline either but that another story.

In one ad, a pay telephone operator interrupts the play-by-play of a baseball game requesting “twenty-five cents for the next three minutes.” “Radio, you shouldn’t have to pay for it.”

There’s a lesson for all of us here. The radio industry is not a brand. Radio is not a brand. Radio is a content delivery vehicle as are the iPod, XM, Sirius, the Internet, cell phones, etc. Individual radio stations are brands but not the industry. But for the sake of discussion I’ll grant that you shouldn’t have to pay for radio even though I pay for my cell phone, my high speed Internet connection and my cable every month.

What about paying for content? That’s a different story. I grew up in Detroit following the Tigers. With XM Satellite I can still follow “my team” all season long. I can’t hear the Tigers in Milwaukee very often, so that content might be worth a few bucks a month.

I listen to WCPE, a listener supported station in Raleigh Durham, North Carolina over the Internet every day. It’s worth a donation of a few bucks a month to support their operations because I like their announcers and the brand of Classical Music they play.

Should I have to pay to shop? Membership stores such as Sam’s Club, Costco and Bi-Mart are sprouting up all over the country. They represent a small percentage of retail sales, just as XM and Sirius represent a small percentage of radio listening. But if we follow the radio industry’s lead, retailers should start using the tagline “Shopping, you shouldn’t have to pay for it.”

Makes about as much sense.

Listen to the NAB ads:

http://www.nab.org/newsroom/issues/radio/radiomarketingcampaignspots-talk.asp

The Sins Of Synergy

One of my favorite books is “A Confederacy of Dunces” by the late John Kennedy Toole.  “Confederacy” is synonymous with “Synergy,” which is the title of a new study from the Radio Ad Effectiveness Lab available from the Radio Advertising Bureau www.rab.com. 

“Synergy” purports to be a study of the effectiveness of combining radio with other media.  In typical “Please sir, may I have more?” fashion, the RAB suggests that replacing some “but not all” of your newspaper or television ad with radio improves results.

I’ll leave my criticism of the methodology for another time.  The RAB concludes that consumers are more likely to change brand preference if advertisers replace one of two television or newspaper ads with two radio ads.  Hmmm.

I love radio.  The radio industry has helped me clothe and feed my family for the better part of my adult life.  But simplistic thinking like this makes my head itch and makes the business I love look bad.  I predict radio salespeople from sea to shining sea will actually persuade some businesses to follow this advice then wonder why the advertising failed.

Here are a few reasons:

Fallacy Number 1 – It’s not about the number of ads - it’s about the frequency of exposure.  One would expect a three frequency (two radio ads and one television ad) to be more effective than a two frequency (two television ads).  The question of how many ads are needed to achieve this frequency isn’t addressed in the presentation.  Oops.  We probably should also consider the frequency of the smaller television schedule. Too much reach with too little frequency is the downfall of many campaigns.

Fallacy Number 2 – You can’t measure what hasn’t occurred.  The researchers asked questions of to determine brand preference pre and post exposure by asking questions like “If you were going to buy product “x” today, which brand would you buy?”   

For years I told friends and family that the next barbeque grill I’d purchase would be a Ducane gas grill.  I was absolutely positively no doubt sure.  But the day my trusty 30 year old Weber Kettle collapsed I immediately bought another Weber Kettle (although it does have a gas starter). 

The Coca Cola Company had mountains of research indicating that consumers loved the taste of New Coke and would buy it by the truckload. 

I’ve seen hundreds of people start retail businesses because all of their friends told them that they would definitely buy from them. 

The road to business failure is paved with consumer intentions.  You can only measure what people do.

Fallacy Number 3 – Advertising is more important than the personal experience factor.  Researchers were confused by the results of post study questions comparing attributes of advertised brands with those of unadvertised competitors.  There was no difference between the single media and synergistic campaigns.  The RAB feels the questions should have been more closely related to the attributes presented in the ads.

Boys and girls it wouldn’t have made any difference.  Even assuming that advertising can change perceptions, three ad exposures won’t outweigh a) the amount of prior advertising participants were exposed to, or b) the personal experiences of the participants.  It’s tough to move the experimental needle toward Brand X Cellular while out in the real world participants have been exposed to a significant amount of Verizon’s 880 million dollar ad campaign.  And no matter how many ads my wife encounters telling her how great Pepsi is, she still prefers Coke.  “Can you hear me now?”

When I started out as a DJ the radio industry’s share of ad revenue was around six or seven percent.  That percentage hasn’t changed much in the ensuing 32 years.  I don’t think the radio industry’s approach has changed all that much either.  It was Benjamin Franklin or Albert Einstein (depending on your source) who said, “The definition of insanity is doing what you’ve done in the past and expecting a different outcome.” 

Are you one of the voices in the wilderness trying to change the way we do things?  Remain positive, challenge ignorance and misinformation (even from those who speak for our industry) and help your customers achieve the success they seek.

Interested in creating some real synergy?  Join us for “Radio in the 21st Century” at the Wizard of Ads Academy in Austin. www.wizardofads.com