02/27

Radio asks the Wrong Questions

“What’s the future of radio?”

“How does radio compete against Pandora et. al.?”

“How can we get FM on mobile devices?”

“How do we stay in a prominent place on the car dashboard?”

These are typical of the questions I hear.

And what makes them all similar is that they are asked from the inside-out. That is, the implicit assumption is that radio’s past must be sustained into the future, and with a few tweaks here and there we can dial up our relevance (pun intended) and dial down our risk.

This is equivalent to the consumer products company that asks “how can we make a new product that we can successfully sell?” – as long as that product is envisioned, made, and sold to fit with all the previous products the company has sold in the past and, ideally, to the same consumers.

As James McQuivey asks in his wonderful new book, Digital Disruption: Unleashing the Next Wave of Innovation:

Instead of asking “How can we make a new product that we can successfully sell?” the disruptor asks: How can we give people something they really want.

Consider that Arbitron’s PPM device doesn’t measure “what people want” – it measures what PPM devices are exposed to.

Over the long run, “playing the PPM game” will increasingly diverge from “what people really want” since exposure to a scattered and deficient sampling of “beepers” has always been a poor proxy for consumer desire and will be significantly poorer as options explode onto the scene with keen attention to the fundamental issue that should be at the heart of the entire radio exercise in the first place:

What people want.

Recently I was brainstorming with a (non-radio) media client and business models were central to our discussion – business models that swirled around the fundamental challenge of giving people what they want.  “We’re too dependent on ad revenue,” they said.  “We need to increase our subscription revenue to make up for falling ad dollars.”

That leads to the question: “Subscribe to what?” And the answer is: “Whatever people want that is within our current or potential capacity to provide.” But here’s the point: It starts with the consumer – not with you.

Radio’s utility is not just a function of its ubiquity – it’s a function of providing unique value over the generations – giving people what they want. When TV blew onto the scene radio adapted to provide new unique value. And now here we are again.  It’s time for the kind of transformation nobody working in the industry today has ever seen.  And while that’s too bad, that’s the way it is.  We need to get used to it.

It’s not about new ways to sustain the status quo.

It’s about giving people what they want in an era when they own the choices and they own the control.

Are you “pro-radio” or pro-consumer?

Do you really have a choice?

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  • http://twitter.com/buffaloreynolds patrick reynolds

    True. Ask not what the consumer can do for you, but what you can do for the consumer.

  • http://www.markramseymedia.com Mark Ramsey

    That has a familiar ring to it…. :-) Thanks Patrick.

  • http://twitter.com/jeffschmidt Jeff Schmidt

    the reason we’re not asking “what does the customer want?” is because radio’s use by 99% of the population has convinced us we’re already giving it to them.

  • http://www.markramseymedia.com Mark Ramsey

    Well the joke is always on those folks :-)

  • http://twitter.com/TomAsacker Tom Asacker
  • http://brownknowsmedia.com/ Jeff Brown

    It may be a bit of a stretch but your post reminded me of the book I’m currently listening to by Simon Sinek called Start with Why. I’m fascinated by how many industries fail to realize people don’t buy what they do but, rather, why they do it (e.g. Apple, Southwest, etc.). What you do merely serves as the tangible proof of the why. The How, What and Why all have to be in balance. In radio, it often isn’t.

  • http://brownknowsmedia.com/ Jeff Brown

    It may be a bit of a stretch but your post reminded me of the book I’m currently listening to by Simon Sinek called Start with Why. I’m fascinated by how many industries fail to realize people don’t buy what they do but, rather, why they do it (e.g. Apple, Southwest, etc.). What you do merely serves as the tangible proof of the why. The How, What and Why all have to be in balance. In radio, it often isn’t.

  • http://www.markramseymedia.com Mark Ramsey

    Yes, I read that.

    I think you’re at a deeper level than even what I was proposing. I’m focusing on the right “what” more than the deeper “why.”
    Too many broadcasters have the wrong “what” while the “why” is “because we have to hit budget this quarter.”

  • http://www.markramseymedia.com Mark Ramsey

    Yes, I read that.

    I think you’re at a deeper level than even what I was proposing. I’m focusing on the right “what” more than the deeper “why.”
    Too many broadcasters have the wrong “what” while the “why” is “because we have to hit budget this quarter.”

  • http://brownknowsmedia.com/ Jeff Brown

    Yes, that’s it…the right “what.” So true, unfortunately, on the “why.”

  • http://twitter.com/JeffVasey1 Jeff Vasey

    Consolidation in ownership and programming, combined with monetized “promotion” campaigns, left radio free to try and dictate tastes to an audience rather than respond to listener’s tastes. That worked when there were far less listening options, but it’s left younger generations to completely disregard it. They are now beyond saving and it serves them right. Good Riddance

  • http://www.markramseymedia.com Mark Ramsey

    I hope you’re wrong about being “beyond saving”, Jeff, because there are lots of smart people out there. But to be sure, this will be about deeds, not words.
    Mark Ramsey

  • Doug Hannah

    Correct as usual, Mark. Which leaves me wondering why, in the non-commercial listener-supported Christian radio world in which I have spent so much time, many stations emulate commercial stations in “playing the PPM game” as you put it.

    These stations by and large DO NOT DEPEND on Arbitron rankings for their livelihood or to fulfill their mission. If PPM formatics are something that enables us to serve people well, I’m all for it, but it seems like there’s this automatic linkage between acheiving high ratings (which many of these stations do) and “measuring our impact”. I don’t believe they are necessarily the same. I would rather see these same stations innovate more since they are by definition free from Arbitron’s cage.

  • http://www.markramseymedia.com Mark Ramsey

    I could not possibly agree more, Doug.

    That’s why at one Momentum conference I asked the question: why is your station structured like a commercial station when your business model is completely unlike theirs?
    Mark Ramsey

  • http://pulse.yahoo.com/_AALJFAJ3VSUAMCQIJOHSOHK5R4 Jason

    Mark,

    It continues to baffle me that an industry that can get so excited about spending $millions over the years in research to develop the perfect AC playlist, or perfect Hot country playlist, still continue to build crappy digital products that no one is interested in. It’s not like we have to grope around in the dark for things that work. We just refuse to open our eyes. The audience, OUR audience will tell us what they want. All we have to do is build it. That doesn’t mean that you necessarily have to let a listener create their own play-list or build their own version of your website. We spend too much time in the digital realm worrying about what we can sell advertisers and not enough time worrying about building our audience. We should not define ourselves by our distribution model. Calling ourselves radio companies is short sighted. We are audience companies.

  • http://www.markramseymedia.com Mark Ramsey

    Jason,

    As the recipient of some of those research dollars I can tell you that not nearly enough of them have been spent.
    The issue is that too many broadcasters treat their assets as cash cow distribution channels, not brands. Why blow money on the cash cow distribution channel? Just milk it until it runs dry!
    If we’re not making brands we’re not making a future.

  • Anonymous

    “If we’re not making brands we’re not making a future.”

    Great line!

    Our digital brand is now more well known in our market than any of our radio stations. We might be a little unique in that regard, but we are not unique in the resources we brought to bear to achieve that. In fact, there are other radio groups in markets around the country who could dominate local media if they got serious about digital.

    TSL is down, and as much as we placate ourselves with the latest RADAR surveys, the reality is that QUALITY listening is falling at an accelerating pace. Putting a signal out doesn’t matter, influence matters. And without extending our brands to where our audience is, especially as they go there more often, we are dooming ourselves.

  • http://www.markramseymedia.com Mark Ramsey

    That’s right. And you need a brand people want – not just the one that’s available in an option-free desert.

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