The Radio Show Rethinks How We Make Money

Back in 2014, John Anderson attended the NAB Radio Show in Indianapolis. He saw advertising executives play to the room instead of giving useful information. He saw market managers bemoan the amount of time their staffs spent on social media. In short, Anderson spent three days at a conference that, from his point of view, wasn’t interested in the realities of radio in the 21st century, but instead wanted to create a safe space for old men that would rather deny the evolution of the way audiences use the medium and instead cling to business as usual.

I came away with the uncomfortable realization that the industry remains the purview of a bunch of old white guys wholly detached from reality and happy to keep things that way.

John Anderson, Radio Survivor

Fast forward five years to Dallas. There was still plenty of cheerleading going on last week, but what has changed is the way the NAB and those invited to participate in panels think about our listeners and advertisers.

As is always the case with industry events, there was a lot of focus on generating new advertising dollars at the NAB Radio Show this year. Each presenter and panel tackled this task in a different way, but at the heart of each presentation was a similar message: value your listeners’ time and don’t take their loyalty for granted.

On Wednesday, iHeartMedia CEO Bob Pittman shined in a panel featuring the CEO of the three largest companies in the industry. No one on stage poo pooed the popularity of podcasting. The message seemed to be not to view the rise of podcasting as the inevitable fall of radio.

Pittman’s message to the audience was to not let the experiences of those around them be their only reference point for the rest of the world. As an example, he asked how many people either own a Tesla or know someone who does. As nearly half the hands in the room shot up, he reminded us that in reality, only 2% of Americans fall into those categories.

David Field, CEO of Entercom, said there is no reason for radio to be threatened by podcasting. “Podcasters could be the gateway to advertisers seeing the sexiness of the spoken word,” he said. That comment came after Cumulus CEO Mary Brenner described radio companies’ need to evolve into “audio first entertainment companies.”

It is something I have believed about the sports format specifically for a long time. There are a lot of guys in their late-30s and early-40s that had probably never considered listening to any kind of talk radio before, but as they grow tired of the same classic rock songs they have been hearing their whole lives and turn to podcasts for entertainment, they discover that great storytelling and engaging debates and discussions are great companions for their commute or workday.

The 2019 NAB Radio Show wasn’t free of moments that made you go “what year does this guy think it is?”. I walked out of a panel on digital footprints that included a guy explaining the differences between Facebook, Instagram, and Twitter. For the most part, the discussions of the impact the digital world has had on the radio industry were based in reality and offered potential solutions as opposed to pure doom and gloom.

Even the panel I walked out of observed that there are advertising dollars that used to go to print advertising that have nowhere to go right now. The way for radio to get them isn’t just better pitches. It is highlighting and expanding digital offerings in a way that forces clients to rethink what a radio advertising package entails.

Guaranty Media CEO Flynn Foster said that 10% of businesses in his home market of Baton Rouge, LA advertise on radio while 99% of them have a digital presence. He then added that everyone in the room should make their next hire a digital strategist if their company doesn’t already have one.

Charlotte Jones Anderson, who is not only Jerry’s daughter but also Chief Brand Officer and Executive Vice President of the Dallas Cowboys, gave a talk about brand building, and while All Access‘s Perry Michael Simon took to Twitter to sum up the disappointing nature of Jones Anderson’s presentation as a whole, she did say two things that stuck with me and I think make a lot of sense in the context of how the radio industry must exist in 2019 and beyond.

The first sentence that stood out was “what impact can every decision have on your brand image?”. The second was “let criticism keep you on your toes without pulling you off course.”

How stations and sales staff present their product to advertisers will either enforce or dispel negative stereotypes about not only the industry, but about the individual station as well. How stations react to hearing advertisers say that it doesn’t make sense to spend money or spend more money in radio will define the future of their business.

There was plenty of focus on what effect the on-air product has on advertising dollars as well. In a session about finding and coaching talent, Saga Communications Vice President of Programming Bob Lawrence compared a station’s brand to a committed relationship. “The only thing in life you experience like a brand is a marriage. You’re courting the listener.” It was a good reminder that talent can influence listeners’ spending decisions by valuing your role in their lives.

The most important session I went to was lead by Meagan Lazovick of Edison Research. Her presentation was about time spent listening with a focus on why people change the station or tune out from radio entirely.

Lazovick’s presentation noted that radio’s TSL is falling on the whole, but radio is still what most people choose to listen to. She presented several reasons people said they change the station or switch from radio to a podcast or streaming music service.

66% of respondents to the survey agreed that “too many commercials” would be a reason to tune out. Lazovick’s solution didn’t stop at shorter commercial satopsets. She also proposed improving and rethinking what radio advertising is.

Lazovick proposed learning from podcasting and creating better, more compelling commercials. She also noted that radio advertising could benefit from stations and talent making their appreciation to advertisers known to listeners.

Rethinking where advertising opportunities exist and how to take advantage of them is how the business of radio reinvents itself for the future. None of us that attended the NAB Radio Show needed to hear the 93% usage rate to know that plenty of people are still listening to the radio. How to monetize those listeners and how to maintain and create revenue streams were what so many came to learn.

Dallas and the NAB were excellent hosts last week. While the hospitality and the facilities were top notch (the Hotel Anatole gym! Holy shit!) JB and I were there to learn what worked and what didn’t and what lessons we could bring to the 2020 BSM Summit in New York. I think we have a lot of good information to add to what we have already been working on for February.