David Meerman Scott is the co-author of one of my favorite books of the year so far, Tuned In: Uncover the Extraordinary Opportunities that Lead to Business Breakthroughs
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Check out the entire Q&A audio below. What follows is only a transcript of some highlights.
Before we get into Tuned In, where do you think radio fits in to “the new rules of marketing and PR?”
Well, every time we go through the development of a new medium the old medium doesn’t go away. It may change a little bit, but it doesn’t become obsolete and disappear. When television came around radio didn’t disappear. It changed a bit, but it didn’t disappear. And I think the same thing is true with the advent of the web as another form of communication.
And here’s what’s really different about the web in my mind, particularly from the perspective of a marketer, which is how I talk about media out there. The web is an amazing opportunity for anybody to publish anything. And that’s really, really good. And for many people that also can be really, really bad because it means that anybody can push stuff out without any editorial idea necessarily being involved. And the market will determine who’s good.
So radio has its place and it’s an important medium. And the idea that you can develop shows and station personalities and all those things is a really good way to break through the clutter of what many people perceive parts of the internet to be.
You mean develop shows that live both online and on air?
That’s another great way and so many people are doing that. Participation can be so different when people can be listening in and participating if they happen to be in a place where they’ve got a computer or wireless capability available.
You talked about TV’s effect on radio. Radio, in fact, changed quite a lot when TV came in. So how dramatically do you think radio will change in the wake of the Internet? I think the very definition of radio is evolving as we bring in digital media.
Consider something as simple as show notes. If you participate on a show the host or producer will put together some notes that will be on the site on the web and then when people need to learn more information about the guest or about the subject that was discussed or related resources they know they don’t have to write it down as they’re driving. They just go later to the station site or the show site and bang, there all the links are sitting there. That, of course, becomes another potential advertising vehicle for the station.
It becomes another way that the station can market because every single one of those show notes is now search engine marketing fodder. And people can find it when they’re doing a search on a particular subject. “Oh my gosh. Well, they just did this particular show. Maybe this particular show next week is going to cover something similar. Maybe I ought to tune in.”
You’re talking about using the Internet to get deeper in to the experience of radio?
Absolutely. Absolutely right.
I participated in a radio show – an online radio show, but the concept’s the same. There were maybe 100 people logged into a chat room during the time that the radio interview was on. And it was really cool because I was one of the guests on the show.
And before the show even started I was able to gauge the tone of the room, if you will, the tone of the airwaves. I did my thing for ten minutes and then I participated in a little chat afterwards. I thought that was pretty cool and it was the first time I had personally experienced it. But there’s a lot of room to make more use of that kind of thing.
It makes you wonder why every talk radio station, every station with a talk program and a guest, doesn’t have a chat room running concurrently for sidebar conversations and for people to get involved whose voices may not be on the air.
I would think so. And I mean you would know certainly better than I how extensive it is. But it was the first time I had been involved in it and I’ve done a bit of radio. So it was a really interesting thing. And, again, around that particular page was advertising. So it’s a potential revenue opportunity for the station as well.
That brings us to Tuned In. What does it mean to be tuned in?
We interviewed 100 CEOs and looked at a lot of different companies to try to get at the essence of how businesses get breakthroughs. And what we concluded was that it’s pretty simple: The businesses that are what we call “tuned in” are the ones that succeed. And being “tuned in” means they are focused on their potential customers and the problems that their potential customers face – as opposed to what most organizations do, which is dream up products and services in their comfortable offices or just create things that they think would be interesting, and then market that
What most “tuned out” companies do is to create their marketing and simply talk about what their products and services do.
So contrast that with the companies that do it right and who are focused on understanding the unresolved problems that people face in the marketplace and how a well-placed product can solve those problems and then become a breakthrough in the market.
But most businesses feel they already do that. How is your approach different?
It literally requires talking to potential customers, potential buyers in the marketplace, not about what you might produce for them, but about what their issues are. I know it seems obvious. And people say, “Well, we do that all the time.” But they don’t. And then an upstart who does ends up being successful.
Here’s a great example that we use in the book. A company called Zip Car. They’re in the rental car business. Now, for years the rental car business has been virtually the same. They have offices at the airports and then a few other spots. People would go and rent a car. It’s almost a commodity business.
And if you had asked people from Avis and Hertz and Budget and National, the big car rental companies, “Is there room for another competitor?” They’d laugh at you because the market is already so crowded. Yet, all of those companies focused on their existing marketplace. They focused on people who rent cars at airports and people who rent cars in the suburbs. They totally ignored the market of people who don’t have access to rental car shops where they live or don’t live near the airport and they don’t want to rent a car for a full day or a week.
So Zip Car created an online reservation-based car system. You get a member card, which looks like a credit card. It has a magnetic strip on it. You swipe your card against a car that’s located physically in parking spots around the city.
You jump in, and drive for a two hour run to Home Depot or Costco or to go pick up Aunt Millie and drive her back in to have lunch with you in the city. And so they’ve built a hundreds of millions of dollars business as a result of literally tuning in to a group of people who had an unresolved problem that a car rental company could fix. But it wasn’t the same old car rental company as everyone else had.
So let’s apply this to radio. Instead of focusing on what your current audience wants, you’re asking the market “What’s wrong with your experience now? What problems do you face now that a radio station could resolve?”
Exactly. And the only way to do that is by literally talking to these people. And I don’t just mean your existing listeners. I mean talking to people who have unresolved problems who aren’t yet served.
I don’t know that much about your business, but maybe ask people who don’t listen to the radio or people who only listen to the radio in the car, but never at work, “Well, why is that?” And see if you can get at issues that they’re facing that can be solved with something that’s interactive and combines with the broadcast or some type of show that isn’t being offered yet. And the surprising nuggets are the ones that you learn when you dig like that.
You have a particular phrase that you use repeatedly to describe strategies done inside-out from the marketing conference room.
Yeah. We say, “Your opinion, although interesting, is irrelevant.” And it’s a good one isn’t it?
It’s so common for managers to think “Hey, I’m the vice president. I’m working hard. I’m making a good living here at this company. I’m a smart guy. I know what my buyers want. I’m just gonna make it or I’m gonna tell the R and D guys to make it.”
And the truth is that we’re just one opinion, and we’re not the market. The only way to truly understand the market is to get out and talk to representatives of that market. And that’s when the surprising breakthroughs come.
Your second step is “understand buyer personas.” Can you just touch on that briefly? Because in radio we’re accustomed to dealing with demographics and ethnicity. And that’s about the extent of it in terms of what we look at and what we offer advertisers.
In the book we talk about how you can understand the people who are actually buying your product. And that might be different, by the way, than the user of your product.
Consider tricycles. The person who buys a tricycle for the three-year-old is not the three-year-old himself or herself. It’s the grandmother or the mother or the father. Yet there are also tricycles made for senior citizens where the person who buys it is also the person who uses it. Now, radio is created for listeners, but the people who pay you money are the advertisers. And the way that buyer personas come into it is how can you understand in really great detail the nature or the archetype of the people that you’re selling your products and services to.
And the companies that do this really well then can develop products and services specifically for their individual buyer personas. I would imagine that there are different buyer personas of advertising buyers at radio stations. There’s perhaps the local advertiser who happens to be in a small demographic only advertising in one station and then there’s perhaps the large advertisers who are the national brands and consumer brands.
Now, we would argue that it’s quite possible if you went out and interviewed representatives of those buyer personas you’d find out that in aggregate the profile for the small company that only deals in one city versus the national advertisers are different. And a smart radio station would develop product – advertising programs for example – for each one of those buyer personas so that you’re offering them something that’s valuable to them and you don’t treat them as a one-size-fits-all commodity: “You want 30 seconds. This is how much it costs.”
I heard just yesterday, in fact, a radio station general manger telling a story about how in a small community in Texas the US Army approached them and laid out what amounts to a buyer persona. They said, “These are the people who are likely recruits.”
“They’re a certain age and a certain gender, but they live here in kind of rural east Texas and they like to work on their cars. So what can we do together?” In other words it was richer than demographics alone.
Right. And now all of a sudden imagine if you really focused on understanding a great deal about that buyer persona, how much more likely it would be that you could then sell advertising to the people who wanted to reach that particular buyer persona. And it’s an interesting way to market and sell offerings as opposed to this generic one-size-fits-all. What this does, the understanding of buyer personas, is it allows us to stop talking about our products and services and instead talk about how we can solve people’s problems. And that’s a really big difference. It’s a fundamental difference.
In fact you actually say in the book, “It’s not about what you do. It’s about what problems you solve.” Right?
That’s right. And you really can’t understand that unless you can understand what it is that you do solve for people and what problems they have. This is simple stuff. It’s just that so few companies are doing it, we felt compelled to write it down in a way that jars people into thinking, “Wow. You know, you’re right. I don’t really do that.”
This entire book is a formalization of common sense and yet so few people do it. Why?
Well, that’s right. People don’t do it because they’ve been focused on the wrong things. They run these businesses and they think that, “Well, I can just invent a product that everybody’s gonna want.”
Well, no you can’t. You can just get lucky and create something. But more often than not you’re going to fail. But if you’re “tuned in” and you understand these concepts you’re more likely to be successful.
We noticed three things that companies tend to do who don’t follow these ideas.
One is to focus way too much on the bottom line. They obsess way too much on revenue and believe that all they have to do is hire more sales people, bring in more revenue, and their problems will be solved. That’s one of the main problems we saw.
Another problem is this blind focus on innovation for innovation’s sake. That’s where people in their comfortable offices dream up products and services instead of focusing on buyers. And then they just create widgets that nobody wants.
And the third thing that we see often is that they focus too much on existing customers and not enough on the overall market. So many companies just talk to their existing customers. Yet for almost every business, if you think of your entire market as a big pie, your existing market is a tiny slice of that pie. And if you’re only talking to that tiny slice you’re missing a tremendously large section that potentially could be your new market.
Your Step 4 is to “create breakthrough experiences.” Can you give me an example of what that process is to create those experiences? Obviously in radio you’re dealing with “air” so experiences become really important.
Once you understand – truly understand – who it is that you’re reaching and what their problems are and you create something essentially to solve those problems, you can create not just a widget, not just a product, but something that so perfectly solves somebody’s problem that it’s seen as a breakthrough.
Lots of other people have talked about the iPod as an example, but I think it’s a fascinating one because there had already been MP3 players before the iPod came around. So they didn’t create the category. They didn’t do it faster, cheaper, smaller, or any of those other things that so many me-too competitors do. Instead they had the brilliance of understanding that it was about the experience.
And the experience relates to simplicity and ease of use. The existing MP3 players were too complicated, so Apple combined iTunes with the iPod and made it really easy to buy music legally and then put it all together so it’s dead-simple. Even my father could do it. And that was the breakthrough experience.
So it’s not a product, it’s an experience. And we believe that companies that are “tuned in” can create breakthrough experiences.
David, as you know, radio has been around for a very long time. Revenue is down now. Time spent listening is down a little bit. Competition is flaring. And people really are wondering what’s next in this industry. If you were in a position to make the decision, what do you think is the most important thing the radio industry should focus on right now?
Well, it may seem obvious and cliché, but I’ll say it anyway. Focus on the people who are out there listening today and those who aren’t listening, but should be. And just understand from their perspective what the industry is doing right and wrong and also what individual stations – individual markets – are doing right and wrong.
As a marketer in radio you can’t just assume that you know better than the people who are going to be listening to you. And those are the people you need to talk to. You can’t assume you know better than the advertisers, the ones paying money, and those are the people you need to talk to.