In 2010, says eMarketer, look for an accelerated movement of ad dollars from traditional destinations to digital ones.
And, eMarketer adds, post-recession media dollars will not return to former levels – at least for the next decade. Some of their reasons:
The measurement and accountability mandate will intensify demand for lower-cost, more efficient media. Media fragmentation will force marketers to target their messages to ever smaller niche audiences. Digital technologies are creating new opportunities for firms to self-market, such as a company’s own Website, online videos, e-mail marketing to existing customers and so forth.
Now is the most important time in the history of radio, because it's only the second time in our history that we've had to ask ourselves this most important of questions: "What are we?"
The first time was when radio countered the introduction of television with a switch to music-oriented formats – a sustainable competitive advantage.
Now here we are again. This time, the on-ramp to sustainable success is, perhaps, less obvious.
It is my belief that radio can be a significant player in the digital world….but only if we stop thinking about that world as a reflection of our terrestrial stations and start thinking about it in terms of what value those terrestrial stations can add to an authentically digital experience.
In other words, one of radio's most important strengths is its ability to capture a large audience and move them to the digital destinations of their (not your) choosing.
Thus, one play is to create and monetize destinations worth visiting, and I'm not talking about destinations branded with your call letters.
Another of radio's important strengths is to use its expertise in the creation of audio content to expand the market for online audio. Radio's efforts at streaming content are lackluster at best, since the vast majority of that content is repurposed from over-the-air stations and bordering on commodity quality. There is measurably less value to the end-user in the average music station streamed online than in the average Pandora station. And when Pandora or a Pandora alternative become as easy-to-use and ubiquitous as radio, then what will be your value proposition?
Radio will either awaken to its place in the content-creation business or will surrender this business and the advertisers that go with it. Radio historically specialized in the creation of content. Hollywood for the ears. But thanks to budget cuts and our addiction to "reach," what's unique about that content (i.e., the stuff between the songs or in place of them) is slowly ceasing to exist. If you don't have something that's the "best in the world" (to use Seth Godin's phrase) then why in the world will listeners, viewers, or browsers seek you out?
Radio must acknowledge that there is no such thing as "radio" – there are only marketers with marketing problems and consumers with needs and passions. Linking these two groups in creative ways across platforms is the key to the future.
Why doesn't Radio create audio-centric solutions for advertisers the way digital agencies create social media widgets for their clients? We must get out of the business of bundling listeners en masse for spots and get into the business of solving the problems of our clients with novel and effective ideas.
eMarketer predicts that while media dollars will shrink, media consumption will continue to grow, forcing media to become more….
Distributed—the same content will pop up in multiple locations, formats and channels. Personalized—media will be tailored to reflect what consumers have watched, read, experienced and shared. Contextualized—when and where consumers get their information will dictate its content and format, and that, in turn, will shape how they interact with and share it.
"Distributed" does not mean spreading your station everywhere, it means spreading your content everywhere, assuming it's your content to spread, and assuming it takes a different form in every channel of distribution.
"Personalized" means you recognize me uniquely when I log on. It means your website – your content – is different for me than it is for my friends who also go there, just as Gmail is different for everyone who uses it. The idea that the vast majority of radio properties still do not require (and provide sufficient value to justify) registration is a huge problem.
"Contextualized" means, for example, that if you're a news station you're not in the radio business. You're in the business of getting me my updates in every way I want them, whether or not I ever intend to go to the station for them. A couple years ago we had tragic fires here in San Diego and the news station's website was filled with little up-to-date detail but lots of invitations to "listen for the latest updates." Those days are over and gone. Making it inconvenient to get what I want from you means that I will simply go someplace else for it, maybe never to return. An "inconvenience wall" is functionally identical to a pay wall. Don't erect one.
The idea that media dollars will shrink while media usage grows is why our obsession with reach is such a farce. We don't need to get more listeners to more radios, we need to get more compelling content in more forms and we need to deliver more effective solutions to more clients. We should be about value, about impact, about effectiveness, not about "reach."
We have only scratched the surface of the transformation that must come.
2010 will be an eye-opener.