Ink Tank

Bound By The Chains Of History

2009-12-07T11:50:00-05:00

Most of my friends live in the past. Perhaps it’s their age, perhaps they are romanticizing a bygone era — or perhaps they’re right. We must not discount the value of experience. Yet, while experience can anchor us, it can also capsize the ship during a storm of change.

In Glimmer, Warren Berger’s new book about design, collaborator Bruce Mau discusses the reinvention of entire industries and businesses through experience design. Mau believes that true innovation is rarely accomplished from the inside out. For example, MP3 players had been around for several years when Apple made the iPod a phenomenon by bringing in outsiders to reinvent the consumer experience.

Mau says people on the inside, no matter how innovative or proactive we think we are, tend to worship elements of the past, bowing to them like golden calves. We may have breakthrough moments, but we talk ourselves out of changing because of an idea’s historical importance.

In radio, for instance, we cling to the standard 30- or 60-second ad format. Why? Because we run our stopsets at the same times. Why? The stopset clock used by most radio stations today was based on an Arbitron TV ratings clock from the 1950s. That became the quarter-hour measurement, and we stopped in those traditional places because running ads within five minutes on either side of the quarter-hours would penalize our quarter-hour shares. We can throw all that out the window in a PPM world. How many stations in PPM markets are stopping at the same times they used to? All of them.
This week I hold my Forecast conference, an annual gathering of radio executives. Some will talk of change, as they have for the last few years, but few will report that they have actually made any significant changes. Some will say what we are doing is working well while reporting another down quarter. Perhaps they are right — but how will we know unless we experiment?

What if a radio company, or the industry as a whole, brought in an outsider to reinvent the radio experience from the outside in? What would happen? How would radio change? Chances are it wouldn’t; we would ignore the outsider’s recommendations because they "don’t understand radio."

But those wacky ideas might work. We pooh-poohed streaming, but Pandora, a webcaster that some say doesn’t understand how radio programming should be done, has amassed an audience of millions. Radio continues to discount it, which probably makes Pandora CEO Joe Kennedy very happy as he flies under the radar to steal our audiences. Although he has yet to effectively monetize the service, eventually something will work.
We all live in the past to some degree, because the past has proven successes. For example, I’m a big believer in the basics of community and local personality to facilitate an unfair share of the market. It’s proven itself time and again. But how realistic is it that debt-burdened companies will reinvest when survival is on their minds every moment of every day? How likely is it that one company will hire an outsider to reinvent and experiment with even a single station?

Perhaps it’s time. You cannot create change when bound by the chains of history.

The Fat Lady Is Singing

2009-12-04T14:31:03-05:00

A message from Publisher Eric Rhoads

According to Wikipedia, the expression "It ain't over till the fat lady sings" originated with comments about Richard Wagner's Der Ring Des Nibelungen and especially its last part, Gotterdammerung. The fat lady is the Valkyrie Brunhilde, often portrayed as a very buxom lady with a horned helmet, a spear, and a shield. Her final aria lasts almost 10 minutes and marks the end of the cycle of operas.

It's over. The fat lady is singing. Today is the last chance.

When I told the story about why I created the Mighty Red HD Radio, I never anticipated we would sell so many so fast.

We sold out our entire shipment in the first four hours after my e-mail one week ago today. We never anticipated that some people would buy 15 or 20 radios and that the average order would be 2.8 radios.

Because of the demand, we scrambled to get another shipment created. We doubled the size of the shipment this time, and now it's almost sold out. Only 350 radios remain from that shipment, which will be the very last.

No more. The fat lady has sung.

A Crapshoot
When you create something like this, you never know if the market will like it or accept it, especially after I've told you about the big booming HD sound from this little tiny radio you can strap on your arm for $35. But comments are starting to come in from people who received their orders from our first shipment.

Eric,

As promised, my Mighty Red by Eric Rhoads arrived today and within minutes I was hooked into Supertramp on The Gator. I haven't tried the earbuds yet, I wanted the full experience and have no problem pushing my big ol' broadcast cans through a mini adapter. "Goodbye Stranger" never sounded so good on a device smaller than a pack o' smokes -- especially since I have trouble getting good reception on standard FM this far north.

Thanks, Eric, Merry Christmas!

Dick Downes, CRMC
President/CEO
Custom Publishing & Marketing Group Inc.
Jupiter, FL

Eric,

I just received my Mighty Red, and it is mighty great!! Easy to use and, as you said, good quality audio.

I salute you for your getting this accomplished. The industry needs to promote this because it is a great advantage to radio listening. I also got one for my son who lives out in Palo Alto, and when I told him about it he had never understood what HD Radio really was, and he is a radio listener. He's coming here next week and I am excited to give him his and show what it can do here in NYC/Long Island.

Eric, thanks for covering radio's back. You are a great asset!!

Happy Holidays,

Jim Champlin

I got my Mighty Red yesterday, charged it and am using it now. You have hit a HOME RUN with this little radio. Way to go, Eric!

Webster James
Raleigh, NC

Mighty Red. The Little Radio With Booming HD Radio Sound by Eric Rhoads.

Special $35 price.

Once these last 350 are sold, Mighty Red becomes a collector's item.

My goal is for every person working in radio to own and experience HD Radio.

A great gift for family and friends.
A great employee gift.
A great client gift.

The last day we are offering these is at our Forecast Conference in New York on Tuesday. Unless, of course, the remaining 350 sell out today, which is likely.

To place your order, visit

www.mightyredhd.com

Eric Rhoads
Radio Ink

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Liberating This Chained Industry The Good and Bad News About Radio and the Coming Renaissance

2009-12-02T13:29:34-05:00

A message from Radio Ink Publisher Eric Rhoads

First, the bad news.

Radio will be down 18-20 percent in 2009 and is expected to finish the year at $15.5 billion, down from $21.5 billion in 2006.
Radio has lost over 10,000 jobs, and that number could increase.
Several radio companies are facing bankruptcy.
High fixed costs (much of which is debt), perishable inventory, and overcapacity are creating a deflationary spiral in rates, which continue to fall.
We have commoditized the radio business because it's easier to stimulate demand through price than to train people and hold them accountable for selling value.
Much of our industry has been forced to eliminate valuable localism, strong sales organizations with accountability, and much-needed promotion.
We face low-cost competition from online media, which is seducing advertisers with brilliant technology that makes offerings highly targetable and attractive.
The likelihood of increased federal regulation appears to be looming, with deeper controls on content and potentially increased costs through performance royalties.
None of us is immune. Every station owner, operator, employee, vendor, and supplier is impacted.

Now, the good news.

Unlike print, newspapers, and television, radio listening is alive and well, and radio continues to have a strong hold on audiences. Our audiences are not eroding.
New data suggests that radio has not lost its grip on the youth market and remains relevant with 18-34-year-olds.
Independent broadcasters and many small-market operators have been able to prevent severe declines in business with strong localism strategies.
Some radio companies are starting to wake up to the fact that digital media plays a significant role in our future and are integrating it deeply into their organizations.
Desperate times spawn great innovations. New plans seem to be emerging that will change the very nature of how we operate our business.
Bankruptcies and further consolidation will weed out many of those who have had a negative impact on radio.
There is money to be made even in a declining industry, and most industries cycle back eventually.
Breakups of some larger groups will spawn more independent, true-to-the core broadcasters.

The Best and Worst of Times
Historically, the worst of times bring the best of times. When things appear their darkest and coming storms create further disruption, we must stay focused on the idea that with storms comes a cleansing and dramatic change.

The Radio Reset Button
It won't be long till we see a massive reset in this industry. Though flushing out equity and handing companies over to lenders won't solve our problems, it might, at the very least, open eyes to the need to focus on sound business principles that have been ignored, and to simultaneously focus on true innovation. This innovation will be disruptive, will create further job losses, and will bring a true reinvention of how every radio station is operated.

One thing is for sure: Returning to the past won't work. Though elements of the past that have been ignored will become critical to continued survival and success.

Liberating This Chained Industry
We, the people of radio, are living in an important time. Those of us who remain committed to the radio industry will see days ahead in which we thrive. Those who understand that we must reinvent the way we create programming, the way we offer it to the marketplace, and the way we sell it, and those who are willing to challenge every assumption will thrive. Those who possess the important heritage skills, many of which have been ignored, will again have the opportunity to prove how radio can thrive with the right tools.

But this won't be your father's radio industry, or even the industry we knew pre-consolidation. The past won't return, no matter how much you pine for it, and you'll need to remain flexible and open-minded. Actions that may at first seem like bad ideas may in fact liberate this chained industry. It will be a different industry than we know today, but those willing to adapt their skills will see very bright days ahead.

Refusing to Repeat Our Foolish Mistakes
For decades I've watched this industry from the perspective of an industry publisher. My gut tells me that radio is about to experience a renaissance. No one can predict what it will look like, what the outcome will be, and who will emerge to lead it. I can almost guarantee it will be different from anything most of us can anticipate. With it will come great hardship, great change, and, sadly, many more of our industry brothers and sisters will be sacrificed. Yet this industry will emerge stronger than ever.

But only if we refuse to repeat the foolish mistakes of our recent past. Radio's future lies with debt holders, equity investors, and board members, whom we can only hope will demand higher levels of accountability from their CEOs and be willing to invest back into this industry, which has been stripped of its natural resources. We must have strong, accountable boards and stronger CEOs, who are willing to battle the whims of investors who not broadcasters and who will not be puppets or yes men.

We need experienced operators who can not only implement the core basics that have been removed from our industry, but are open to dramatic change in the way everything is done. Unless these debt holders start to understand that, in some cases, they've bought into the tricks of fools, and unless they begin to surround themselves with experienced people who have earned their stripes on the streets of radio rather than pretenders, we'll simply enter into phase two of a radio experiment gone bad. Yet somehow, I sense the bad eggs will be thrown on the grill, and the domino effect will be like bringing down the Berlin Wall, with the hope of returning this industry to great days ahead.

Are you ready to commit to the coming renaissance? It will be a wild ride, but well worth the effort.

Best,
Eric Rhoads
Radio Ink

Please don't reply to this e-mail. To comment, click here.

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My Battle Over HD Radio Broadcasting And The Biggest Sale of My Career

2009-11-24T11:51:54-05:00

A Message from Eric Rhoads, Radio Ink

Note: So you don't read deep into this story and then realize I'm going to ask you to spend $35, I'm telling you up front. Read further.
A Stink Over HD Radio Broadcasting
By now you know that I've made a stink about the HD Radio broadcasting effort from time to time. It all started a few years ago, when I asked the guys at iBiquity to send me an HD Radio unit for evaluation. Frankly, it was not a good experience. Of course, many believe HD Radio technology is the savior of radio and allows radio to compete in a digital world. But I have not been fully convinced. Radio's salvation will be the moment we return to a commitment to entertainment and localism, industrywide.
Plus, the HD Radio Alliance believes that offering more formats on HD2s and HD3s is a way to provide the same diverse choices listeners are getting elsewhere. I haven't fully bought that, either.
So Am I or Am I Not a Fan of HD Radio Broadcasting?
Though I'm not convinced the strategy for the HD Radio broadcasting rollout is the right one, I do believe that better audio fidelity, more choices, and more services for listeners are good things. I have grown accustomed to artist and song information with satellite radio, and I expect it from radio now. And HD does offer song titles and artists.
So is HD a good thing for radio? It can't hurt and might help. And, since radio groups have converted almost 2,000 stations, and since more manufacturers have committed to HD Radio products, it's not going away.
So Why Hasn't HD Taken Off, Eric?
I believe the biggest issues have to do with the need for an argument so powerful that every consumer will want to go out and get one. I also believe expense has been a problem. Most of the HD Radio units I've seen are expensive.
Of course, people don't just go out and change their car radios on a whim. It usually happens when they buy a new car. And I'm not sure consumers have been sufficiently persuaded to invest in an expensive radio just so they can try out HD, especially when they're used to radios being fairly inexpensive. All these issues have created a slow start -- though the people at iBiquity say that there have been over a million HD Radio units sold, and sales are more than doubling every year.
A Wakeup Call
Recently on my blog someone said, "Eric, perhaps you should stop complaining about others and lead this industry by taking action on your own." He was right. Leadership is about taking action if I don't like where things are going. It dawned on me that I need to take action to move the needle on HD. So I started thinking.... What can I do to help HD Radio broadcasting take off? What action can I take? How can I provide the missing leadership?
Thought Leaders
Many companies launch products quietly by identifying thought leaders, giving them the product, and allowing the word to spread virally through that leadership. MINI Cooper did this when it gave cool people in markets across the U.S. MINIs to drive. When the cool people were seen in MINIs, their friends wanted them too. The product spread virally before it was heavily marketed.
So who are the influential thought leaders and cool people? It just so happens that some of the most influential thought leaders in America are ... drumroll, please ... radio people.
A Crack in the Radio Foundation
"This is easy," I thought. Since radio people are such influential thought leaders, we should be able to start an HD movement with radio people, right? But all those spots we ran on all those stations didn't seem to move the needle much. What's up with that?
The more I asked around, the more I understood that there was a crack in the foundation. Most radio people have never even experienced HD Radio broadcasting, including most of the employees at companies that offer it. How will we ever get a movement if the radio industry, at the grass-roots level, can't experience HD? How likely is it that most radio people will go drop a few hundred bucks for a desktop HD Radio receiver? Shouldn't every DJ, every AE, every manager own an HD radio? Of course.
The Little Box That Made FM Boom
OK, I'll admit it. I was born in the dark ages, and I was around when no one had FM radios other than home stereos (of which there were very few). But the only FM stations were elevator music stations. When FM rock stations started coming on the air in the late '60s and early '70s, the unique content drove adoption (something we need to do on HD -- underground content!). But you couldn't find FM radios to buy, and you certainly couldn't find FM car radios. Or if you did, they were expensive. But a little box changed everything. Audiovox came out with a $15 converter unit ($50 in today's money) that received an FM signal and put it through the AM in your car radio. Every kid I knew had one, and that's what drove FM adoption until FM radios became more available and less expensive. That is what is needed for HD Radio broadcasting.
The Biggest Pitch of My Career
For all the grief I give HD Radio broadcasting, I have to admit that the people at iBiquity are really willing to listen. Of course, they want to see HD become a huge success. So I scheduled a call with CEO Bob Struble and some of his top people, and I said, "I want a small, inexpensive HD Radio receiver. My goal is to put it in the hands of every employee at every radio station in America. I want something that is portable, something with mighty HD sound that I can carry in my pocket, that I can listen to at the gym, and that I can plug into my speakers or the audio jack in my car. And I want it for under 50 bucks so every radio person can own one and experience true HD."
(Long pause.)
"Eric, you want us to manufacture a special radio for you?" said one executive. "Are you nuts? Do you know what it would cost to do that?"
"Yes, and I need it before Christmas. If you do this, it will be the foundation for launching HD because radio people will have it, experience it, embrace it, and start spreading the word like never before."
(Another long pause.)
My Biggest Sale Yet
Now, I make my living as a salesman, and I like to present bold, audacious ideas. When I presented this, I was sure these guys would mock me, but I persisted, and I was able to convince them to manufacture a special HD Radio unit just for radio people. Not only that, but I convinced them to let me create my own special design and brand.
Putting My Butt on the Line
Once I convinced iBiquity to manufacture a special radio, I realized my butt is on the line. This strategy had better work, or I'll lose all credibility with them, and they'll be sitting on a few carloads of special HD Radio receivers that they can't sell elsewhere, at a cost of hundreds of thousands of dollars. Plus, I had to act fast. Here it was September, and I had to get my concept, design, prototype, and shipment in time for Christmas.
They said, "We can do it for Christmas in 2010, but not this year, Eric. Be realistic." But I was especially persuasive on this matter and got my way, and iBiquity has pulled out all the stops because they believe that an HD Radio receiver in every employee's hands is good for HD Radio broadcasting.
The Moment of Truth
I was pacing the floor, knowing FedEx would arrive any moment with the prototype. Would it live up to my expectations? When I opened the package, there in front of me was a box with the logo, branding, and packaging I had designed.
"Mighty Red: Radio Ink's Little HD Radio with Booming Sound, by Eric Rhoads"
I named the radio MIGHTY RED to make a point that this little radio had MIGHTY BIG sound. I designed it to be RED because RED is the Radio Ink color, and because it would be easy to find (I'm always losing little things). Plus, these days RED is a symbol for the best of the best. In HD video, for instance, the best video camera in the world is called RED. So why not make my mighty little radio RED because of its awesome quality?
I carefully opened the box, pulled out the radio, charged it in a USB slot, and took it to the gym. On the treadmill, I hit "scan," and the first HD signal I received was KDFC in San Francisco. BOOM. The audio was amazing. Crisp, clear, and booming. I had plugged in my $100 Sony sound-canceling headphones, which is the standard I use to judge the audio on iPods, the Zune, etc. The audio on this little radio was amazing.
The screen told me what station I was listening to and what song. I clicked up to KDFC-HD2. Classic, deep cut tracks that put a smile on my face and took me back to another day. I then went over to KFOG, which was playing a blues tune. I cranked it up, cranked up the speed on the treadmill, and my mind got lost in the sound. The audio was absolutely blow-me-away perfect. All from this tiny -- and truly mighty -- little red radio. I kid you not. This little radio is absolutely mighty and has the best small radio audio I've ever heard in my life. It's so good I'm actually excited about it and can't wait for you to try it.
Your Role in Radio's Future
HD Radio broadcasting isn't going away, and we can all have a hand in its success. If you're in radio and you don't own an HD Radio unit, you simply need to own one, need to listen to HD, need to experience it so you can fall in love with HD audio like I did with my Mighty Red. Without the foundation of people in the radio industry owning HD Radio receivers, we cannot expect to convert the rest of the U.S. to HD listeners. Yet if every person working in radio buys an HD Radio receiver, we will have the foundation we need to influence others.
Billy Mays Would Be Shouting From His Grave
Though I'm starting to sound like the late Billy Mays pitching Magic Putty, this is a limited production run. (I wonder if he was related to Mark and Lowry Mays.) We will not sell these in stores. The exclusive MIGHTY RED by Eric Rhoads was made just for radio people (and your friends and family for Christmas!) with the intent of selling out rapidly. Plus, I convinced the people at iBiquity to create this radio and offer it at a special price of $35, which makes it affordable for every person in radio. And that's important.
How Do You Want to Feel Right Now?
When you own Mighty Red, you'll fall in love with radio all over again. I did. The audio is that good, and the new HD2s and HD3s were playing songs I hadn't heard on radio in years, if ever. I'm very excited about it. And, for the first time, actually excited about HD Radio broadcasting. Now I have a tiny portable HD unit that I can jog with (it comes with an armband holder and headphones), plug into my car audio jack so I have HD in my car, or plug into my stereo at home or the office for HD audio.
If you want to feel great about radio again, and feel great about HD Radio broadcasting, buy a Mighty Red. My goal is for everyone in radio to own one, to build a foundation for HD. If radio employees embrace HD, we will have the launching pad for HD adoption nationwide. It starts with you.
I hope you'll consider buying my custom-designed Mighty Red HD Radio receiver and consider it for Christmas gifts for your friends, clients, etc. Please do it today. There may not be another chance if we sell out today.
Click here to buy, or go to www.mightyredhd.com.
Best,
Eric Rhoads
Radio Ink
PS: These radios have just arrived on the shores of the U.S. and will be released from U.S. Customs at any moment. You cannot buy an equivalent HD Radio receiver at this price anywhere. This is a special offer for the radio industry only, and once our shipment is gone, there will be no more.
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I'm A Customer Who Does Not Matter

2009-11-23T12:30:00-05:00

As a favor, I do the advertising for a friend who owns a small business in San Francisco. We're not a huge radio client, but we spend just south of $100 grand a year there. Things have been pretty smooth, except for an AE I had to scold for going around me and getting my client all worked up that perhaps we should spread our schedule across wider dayparts. I had to ask him not to go around me, and ask the client to simply say "talk to Eric" next time he tried to do something that was contrary to the strategy.

Yesterday my friend asked me to stop all of his advertising for strategic reasons. I e-mailed the rep, but the message came back as undeliverable. When I called his direct line, it simply said, "There is no one at this extension. Click."

What do I do now? I happen to know another seller at the station, so I shared my experience and hoped that the word would get to someone to cancel my schedule. He responded that this person had left the station and that he would forward my request to the sales manager. Then I got an e-mail from some rep I don't know, who knows nothing about the account: “I dug into this and found where your ads were running and cancelled them. Hope you're not canceling because you did not get response.”

Maybe I'm insane, but my mere $100,000 investment seems worth a little attention.

What about:
• The AE letting me know he left — either as a courtesy to his former employer, or even to try and switch me to the station he now works for. The fact that he had been gone three weeks and did not notify me says, "You're not important enough to me."
• The station that never bothered to say, "We made a change and we're asking someone else to work with you." What a novel idea. I must not matter.
• The station that disconnected the AE’s e-mail instead of having it go to someone who could respond to my request. What if it had been an insertion order instead of a cancellation?
• The salesperson's direct line not having a message that the person is no longer there, or ringing to someone else.
• The new AE who did not bother to introduce herself, call me, get to know me, or try to reengage me. What a missed opportunity.
This is not rocket science. Clients want to be kings and queens. When they spend — or consider spending — money, they expect some basic services. They want to be appreciated and wooed.
Write these words on an index card and staple it to your forehead: THE CUSTOMER EXPERIENCE NEEDS TO DAZZLE CLIENTS. Have you designed the ultimate customer experience? Have you trained your people in every possible point where they interact with clients? Have you asked your customers what would make their experience better?
Customers don't speak up if they’re not asked — they simply get even. Most people who had the experience I had would simply go elsewhere. If I don't matter, why should I spend my money with them?
There are other stations and other options. Don't forget it. Customers are hard to get. Don't lose them because your customer experience is awful.

Loss Of Trust: How Citadel Media Just Raped Radio

2009-11-13T15:57:52-05:00

A message from Radio Ink Publisher Eric Rhoads

Before I begin: In the interest of full disclosure, Citadel Media (formerly ABC Radio Networks) is an advertiser of Radio Ink.
Imagine, if you will, that your local radio station has spent 15 years and loads of money establishing a local personality. We all know that the personal connection to the talent on our radio stations is one of the most important assets we have. Radio's value is not its signal or its tower. The value comes from the relationship we have with our listeners.
Our Worst Nightmare
When I was a programming consultant, our worst nightmare was having to find a way to take audience away from a heritage air talent who had a lifetime relationship with the listeners. We knew that if we could get that talent to jump ship, there was often more loyalty to the talent than to the radio station itself. If we could take the two or three most established personalities and move them to our station, we could have a much more successful start -up and destroy a competitor. If we couldn't get them to come to us, we would look for ways to get them hired out of the market. That's how important a strong local talent can be.
Sounding Local
Today, thousands of radio stations around the country rely on radio network feeds of formats and talent. The big sell is that you cannot afford to hire personalities this good in most small towns. Technology has become so flawless that local listeners most of the time don't know that a talent is voicetracked or coming from a satellite network. The ability to sound local has improved significantly. Therefore, to the local listeners, the talent they are hearing is local talent.
Sleight of Hand
Last night we received a press release about how Citadel Media had shifted some talent around. What the spin didn't indicate is that these changes were because of a bloodbath of network talent firings. Today my phone has been ringing off the hook from affiliates who are either immediately canceling their Citadel contracts or talking to alternative providers with the intent of canceling. Why? As one local manager I spoke with said, "Our stations success has been built around two air personalities who have been on our air for 15 years. Suddenly, they have been replaced. Our listeners don't know these are satellite guys. They are local as far as they are concerned."
Destroying Hundreds of Stations
Imagine the impact of this decision, which was economically driven. This casual decision to remove some high-priced talent on several formats is disrupting the competitive advantage on hundreds of radio stations in one fell swoop. One format alone may have several hundred stations that had built their entire businesses around those personalities over decades. Their competitors are popping open the champagne because the toughest talent to beat just got replaced by people who don't have a bond with listeners. Of course, doing this across several formats could destroy (yes, destroy) the businesses of hundreds and perhaps thousands of radio stations. All to save a little money on highly paid talent.
Self-Destruction
This cost-saving move, which corporate executives may see as harmless, could result in loss of ALL of their format affiliates. Citadel Media's competitors are on the phone today with every affiliate. In fact, while I was talking to one manager today, he received a call from Dial Global.
Killing Trust
Look, I would not want the debt, the pressure, the bankruptcy Citadel may be facing soon. And I too would be looking to save as much money as possible. I wouldn't want to be in their shoes (though I'll be one step closer when they cancel their advertising because of this missive). But don't make material changes that kill the trust of your customers.
If you want to do it at your own radio stations and risk losing audience and revenue, so be it. But today millions of radio listeners woke up to new talent, wondering where the people who have been their friends for decades have gone. Radio owners across America just lost their heritage brands, and that has to severely impact their business. Advertisers have talent loyalties too, and this move could kill these affiliates.
How Dare You?
Where is Citadel Media's loyalty to its affiliates? Without them, they have no business. How can affiliates trust Citadel Media now, when they've raped the airwaves in hundreds of markets that built their business on the heritage brands and air talent? Farid, how dare you treat your customers like this?
Broken Eggs
Corporate responsibility must go beyond financial responsibility to shareholders. Thousands of affiliate radio stations had all their eggs in the Citadel Media basket, and those eggs were broken over a decision to make the next quarter look a little better. The ironic thing is that this move will worsen shareholder value because of affiliates jumping ship, knowing they can never trust the company again.
Undo This Decision
If Farid Suleman were savvy, he'd call all those fired talent back, apologize to his affiliates, tell them this was a terrible error in judgment and that he did not realize the negative impact to his affiliates. This, and only this, will save his format business and might prevent a class action lawsuit.
Revenue Lost
I don't make a habit of cutting my own throat. I know I'll never see another advertising dime from Citadel Media. I know Farid will probably decide not to make his annual appearance on the group heads' panel at our Forecast conference. I don't care. I'm livid, and someone has to speak up and defend these radio stations, even at the expense of losing a substantial advertiser.
Hundreds of radio stations may be destroyed over this, millions of dollars in advertising may be lost, entire businesses may be destroyed because of this decision, which could impact the incomes of hundreds or thousands of radio station owners. This decision was simply irresponsible.
Best,
Eric Rhoads
Radio Ink

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A Message from Deborah Parenti, VP/General Manager of Radio Ink:

Important Independent Broadcasters Panel to Be Held at Forecast
If you own a small or independent radio station, we invite you to join us at Radio Ink Forecast, less than four weeks from now in New York. The panel, Independent and Optimistic: How Small Radio Companies Succeed, sponsored by Arbitron, will discuss the secrets of successful independent operation in today's media and economic worlds. A panel of leading independent owners will discuss what it takes to keep revenues pumped and cash flowing at their stations and how their ability to act -- and react -- nimbly works to their advantage. What are their plans and strategies heading into 2010? Find out as leadership, independent-style, addresses the issues facing all broadcasters.
Moderator: Bill Stakelin, President/CEO, Regent Communications
George Laughlin, President, GAP Broadcasting
Steve Newberry, President/CEO, Commonwealth Broadcasting
Gary Rozynek, President/CEO, Maverick Media
To register, call 561-655-8778, or register online at www.radioink.com/forecastsummit
Attendance is limited to 200 people. Please book your seat early.

The Sky Is Not Falling ... Everywhere

2009-11-09T16:32:06-05:00

A message from Radio Ink Publisher Eric Rhoads

OK, I'm guilty. From time to time I've made blanket statements that could make a reader think the sky is falling in radio. Though, frankly, I've also highlighted many a success story in my editorials, and not everyone in radio is faltering.
For instance, I received this e-mail moments ago. I have removed the name and market at the request of the sender:
Good morning, Eric.
I continually read, almost on a daily basis, the shortfalls that most radio companies are experiencing. Cumulus, Entercom, Beasley, etc. Not all radio stations experienced down third quarters or are having down years. In 2008, my four local sales representatives did more business than 2007. The only shortfall was national, and that was due to massive budget cuts.
Our single, standalone FM in [city removed] delivered a third-quarter increase of 5 percent. 2009's August was the best August in the 40-year history of the station. September was up 12 percent, and October was up 12 percent. November will be up also. Our 2009 fiscal year will be up over last year. We have five cluster operators to sell against. I do not know if [city removed] is an exception to the rule, but I do know that seven car dealers went under this year and numerous retailers and major chains closed stores, including a major employer that closed and put 400 people out of work.
Anyway, I'd better get to my point. Buyers also read this news. As you know, most buyers are very opportunistic and expect rate reductions, assuming all radio stations are suffering. I am constantly battling buyers, local and national, explaining that not all markets and stations are experiencing 15 percent to 20 percent shortfalls.
Many times this has been greeted positively. I want them to realize that the investment they are making in the radio station is in the best interest of the client and is very important to the station. I think they also enjoy talking to someone who doesn't sound like they are getting ready to jump off a bridge. I am sure buyers have heard sellers beg them to buy their stations.
Thank you for listening.

I'm sharing this letter for a number of reasons:
1) I hear from radio stations every day that are making it through this recession and growing their business. Most, but not all, are in smaller markets where they have never been completely reliant on national business. Most adhere to the principle of strong community involvement, which seems to act as an insurance policy when times get tough.
2) I know that several hundred advertising executives using radio and several hundred clients are part of our 600,000 monthly readership. Though I think it's critical to always tell the truth and never sugar-coat anything for their benefit or for the benefit of the industry, I think it's also important to make sure we're not only spewing the negatives for the sake of drawing attention. There are many successes worth talking about.
3) Sure, radio is changing and evolving, and radio operators need to adapt to the new digital environment or suffer the consequences. Many are, but many others resist. But radio isn't going to die just because some think the only future option is streaming or podcasting. We must not forget that most Americans listen to the radio every week, including young people. It's easy to be seduced by what's new, what we love. I'm Mr. Gadget. I buy every new gadget the day it comes out. But radio is so ubiquitous and has such a deep listener bond that it is not easily replaced. (But let's never get arrogant or overconfident.)
4) I don't want cheerleaders with empty promises, and neither do you. Still, you don't want me or anyone else telling you how ugly radio is every day. Enough already. This is a great industry, one that I'm proud of. Sure, there are problems. Yes, we need to address them. Yes, we can find isolated instances with almost any company and make things out to be bad all over, but it's simply not true. Negativity sells, but, just like we don't need overly optimistic voices, we don't need overly negative ones. People love bad news, but it's not good for our industry to always focus on the negatives. Let's not spread the negativity and keep your mind away from negativity.
Radio can't create more jobs in every town, and it can't solve the world's problems. But one thing it can do is play an important role in our individual communities. We can help businesses sell products, and that helps our communities. We can look for positives to share. Not empty cheerleading, but honest, upbeat news in our communities should be celebrated by radio stations that have the ears of those communities.
This letter helped me see my responsibility. I hope this helps you see yours.

Best,
Eric Rhoads
Radio Ink
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A Message from Radio Ink VP/GM Deborah Parenti:
Radio Ink Forecast. Almost 50 Percent Sold Out. Four Weeks Away
The industry's premier event for owners, CEOs, CFOs, station owners, and radio investors. Keynotes include Mike Huckabee, Ron Insana, and a special industry call to action from Dan Mason, President/CEO of CBS Radio. To register, call 561-655-8778 or go to www.radioink.com/forecast.

Great Sales Teams Require Great Coaches

2009-11-09T12:29:00-05:00

Although our salespeople are encountering reduced or nonexistent spending accounts, we as managers cannot accept lower performance. But beating on our sellers for better performance can have an adverse effect on their motivation. Is there a solution?

Like great athletes, most great salespeople are highly competitive. And, similar to athletes, a strong coach can play a role in inspiring salespeople to success. Here is my list of the attributes of a great coach.

1. Great coaches see things in their people that others don’t see and work to pull those qualities out.
2. Great coaches contribute the time, patience, and continual reassurance to develop these attributes.
3. Great coaches communicate effectively. They know how to send the right message in the right way at the right time. They set clear, measurable goals and expectations. They react swiftly — and fairly — when correction is required. They continuously monitor progress and provide corrective actions and ideas.
4. Great coaches adapt their coaching style for each individual’s learning style and needs. It might entail a gentle nudge, a push, encouragement, appropriate scolding, disappointment, or a challenge. They pull the best out of each individual.
5. Great coaches know that one size does not fit all when it comes to incentives. One is motivated by recognition, another by money, another by a dream or wish.
6. Great coaches know their team members’ limits, strengths, and weaknesses. They do not set their players up to fail. They know when to intervene, or when to lend a sympathetic ear. They create a success plan for each team member’s growth.
7. Great coaches are mentors offering experience, perspective, and advice. They are not know-it-alls. They are willing to listen. They lead by example and make people want to emulate their behavior. They inspire confidence and trust.
8. Great coaches foster dreams, hopes, and vision. They help their players picture a better future and continually correct the course with that vision in mind.
9. Great coaches have a sincere desire to help each person grow and achieve their goals. They help players stretch to reach the impossible.
10. Great coaches do not lead by fear and rarely lash out — so when the do, they are taken seriously. They are trusted partners in the success process. They are empathetic, but not sympathetic. They set firm boundaries.
11. Great coaches understand that failure of the athlete is failure of the coach. They are a friend, teacher, and guardian. They stand up for their people and they do not push corporate pressure downward. Instead, they absorb it, while understanding that negative pressure locks up some team members. They demonstrate personal character and don’t ask you to do what they are unwilling to do.
12. Great coaches are realists who are willing to face reality. They are not falsely positive. They listen carefully and seek outside ideas and perspectives.
13. Great coaches do not over-manage. They let people make mistakes and grow from them. They are not hung up on titles or formality.
14. Great coaches see change as opportunity.
15. Great coaches put values and ethics above everything else.
16. Great coaches cultivate leadership and make it fun. They know that a happy team yields higher results.

Learning from the Entercom Tragedy

2009-10-30T01:29:37-04:00

Radio contestant Jennifer Strange and her family.

Imagine the frustration, the torment, the sadness.

You've built a great company, you're a responsible broadcaster, you've got one of the better companies to work for, and one day you get a phone call telling you a promotion gone bad at one of your stations has resulted in a listener death.

Never in a thousand years could you have anticipated this scenario. No matter how much planning, how many rules, how much great management, it all came down to a poor decision on the part of some employees in the radio station, who never even imagined someone would really drink too much water and die. Yet Jennifer Strange, a mother of three who was trying to win a Wii video console for her kids in a "Hold Your Wee for a Wii" contest on Entercom's KDND/Sacramento, died trying to win.

This will go down as one of the biggest promotional tragedies in the radio broadcasting industry.

For almost three years, especially in the last several months as the trial neared, the media has been pounding the story locally and nationally, and the station has often been in the news, but not in a positive light. The GM of the station, the involved employees (10 employees were fired over the incident), the regional VP, and the CEO have probably had days consumed by meetings with $600-per-hour lawyers who defended the company as Strange's family asked the court for $34 million-$44 million for wrongful death. This is a radio nightmare.

Of course, Entercom lost the lawsuit and $16.6 million was awarded to the family yesterday.

I am not in a position to judge whether this was the right settlement, too much or too little to compensate them for their pain. I cannot imagine what this family has gone through. I feel deeply for them.

I also cannot imagine what the people at Entercom and their CEO, David Field, have gone through. I feel deeply for them as well. Entercom has the option to appeal or ask the judge to reduce the award, but nothing has been said about that yet, and Field may have to take more than $16 million from his business, his stockholders, his employees to pay this award. In these days where every dollar counts, this is a huge hit. To those thinking that this big corporation won't even feel it, it's simply not true. A judgment like this could put most any broadcast company today at risk. All because some well-meaning people in the company had a moment of poor judgment.

Knowing David Field as I do, I know he is a buttoned-down, detail-oriented, systems-driven guy. He has high ethics, the utmost professionalism, he is an excellent broadcaster, and I can only imagine how he must be beating himself up, wondering if something could have been done to prevent this tragedy. I'm sure he feels deeply for the family and for his employees, who have been through nearly three years of hell over this.

If anyone in this industry would have had a good prevention system in place, it's David Field. Perhaps a system or rule wasn't followed. That was raised at the trial, but we'll probably never know everything that happened that day.

But in spite of all the systems, all the rules, all the regulations, all the communication, I'm not sure this could have been foreseen. Even if there was a rule that said, "Under no circumstances is the station to do anything that could result in physical harm or death to listeners or employees," most people involved at a promotional level probably would never have considered this a risky promotion. Even if they did know some risk could be involved, they would probably assume than no listener would put their own health at risk to win a prize and would stop before any point of danger. And contestants did sign a standard contest risk waiver, which didn't hold up under California law.

We as an industry need to use this example of a promotion gone wrong as an important lesson. It could have happened to any one of us. If any good comes from this tragedy, perhaps it is the prevention of future tragedy.

Though I'm not saying the people at Entercom were reckless in any way, this is an industry prone to reckless behavior. For instance, I was on the air at 14. I grew up as a teen on the radio, pretty much doing and saying whatever I wanted. I pulled some outrageous stunts, said a lot of foolish things, and frankly it's a miracle something like this didn't happen to me or my stations back then (though we did lose the license of 96X and spent a year in an FCC trial, which is a story for another time).

One of the things that makes radio so magical is that we attract insane people who want to draw attention to themselves. Though there are fewer teens on the air today than in the 1970s, this is still a young and creative business filled with rebels who could easily think up something equally dangerous, not even realizing it. All the more reason we need to invent ways to communicate with employees and have fail-safe systems in place to ensure responsible behavior.

Every radio station manager in the world who reads this should talk about the Entercom story with staff members in a meeting and ask, "What could we have done to prevent this?"

Though we must never remove the fun and playful spirit that brings so much to our airwaves, we need to make sure something like this never happens again.
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The Blue Light Special

2009-10-19T12:24:00-04:00

While reading The Snowball, the authorized biography of Warren Buffett, I learned that his father was a politician. Buffett recounts how he used to tag along when his father, a Republican, would visit meat-packing plants and factories. Though his father may have dreaded spending time in these environments, where he was often met with suspicion and hostility, he knew it was part of his job.

I recently took my kids to a county fair and had a similar experience of mixing with people I rarely encounter in my life otherwise. We all tend to hang with people who have a similar socioeconomic status. Though I don’t want to send the signal that I consider myself better than anyone else, I do consider myself more fortunate. I don’t have to do hard labor or work in a difficult environment like a meat-packing plant.

So what’s this got to do with radio? While at the fair, I commented to a friend that if I were programming a radio station, I’d be spending a lot of time at events like this one and talking to the people. This is where you get the story that research cannot tell. This is where you can learn to understand the issues facing families and the ways your radio station can be most relatable.

In the 1970s, when I was a programmer and, later, a programming consultant, I always insisted that we hold our music meetings in the cafeteria at Kmart. As my music and research director and I discussed each song, we could gaze at the shoppers and have a pretty good feel for its fit.

Sometimes I feel as though radio stations have lost their deep, relatable connection with their audiences. It’s critical to spend time where the bulk of your target audience spends time, whether that's upscale or downscale. An old buddy of mine called “T-Buff” (Tommy Buffington) was a retail consultant in Salt Lake City, at Brown Brothers Furniture. He used to say, “If you want to appeal to the masses, you can’t hang out with the classes.”

I used to give him grief about the overly folksy, hickish-sounding ads he ran on my radio station, but they packed the store when my slicker ads would not. It was clear what he did was working.

Where are you spending your time? Are you investing time to learn more about your listeners and their lives? Every programmer, manager, and air personality should be required to invest time in the study of their target audience — not just reading data, but immersing themselves in the local culture. Only then can they truly understand the value of the Blue Light Special.