What “Creative Destruction” means for Radio

Mitch Joel is the president of Twist Image, a Montreal-based digital marketing company, and author of a terrific blog and book called Six Pixels of Separation: Everyone Is Connected. Connect Your Business to Everyone.

Listen to the complete interview by clicking below – what's printed here is just a transcript of highlights. And go here to subscribe to all the hear2.0 podcasts directly from iTunes.


Mitch, where do you see radio from your vantage point? 

I don’t think this will be news to you or your listeners, but the radio industry is in a lot of trouble. Just this year, online advertising surpassed radio advertising. So there are a lot of challenges that I think the radio industry has to address. 

Your book, Six Pixels of Separation, is trying to make a point about the connections between everything. Can you talk about why this theme is relevant for an audience of broadcasters? 


The book’s core message is that we are entering a world where you and I don’t need an introduction to a third party to connect. Just one simple Google search and I can connect to you on Facebook, Twitter, etc., and that changes the game entirely. If you lay that over the radio world, that’s dramatically different from an industry that has traditionally been based on markets. 

The big idea in radio was syndication – for example, to get Howard Stern into multiple markets, and the idea of syndication online is almost laughable; I mean you have a global audience.  I was recently asked if I would be interested in doing a radio show, hosting it myself, and it’s interesting, but it’s just small market if you consider that my podcast has a global audience. 

So I think that the concept and the content of the book will help business owners, radio station owners, big media companies, etc., really understand that there’s a different thing happening here called “conversation.”  If we don’t understand how to integrate that into our play and how we get our content out there or figure out how we’re going to transition this business model to something new, things are going to get pretty ugly. 

One of my favorite quotes is from the Tom Peters book Re-imagine. He quotes US Army General Shinseki: “If you don’t like change, you’re going to like irrelevance even less.” 

So it’s not a doomsday for the radio industry; I actually see it as more of a tremendous opportunity to really innovate now. 

So what are some of those “innovation opportunities”? What are some strategies for radio stations to remain relevant in this digitally-based world? 

The first thing we have to understand is the insanity that if I’m on your radio show live and the audience doesn’t happen to be in their car or sitting in their bed at that moment, that piece of content is gone and dead forever. That’s insane. In this day and age of almost free server space it’s important to make all that content easily and readily available to anybody and everybody who wants it. Then as you build that out, you can sell advertising attached to it. 

The other thing you need to understand is how radio tends to abuse social media tools. I follow a lot of radio stations that have Twitter and Facebook feeds but what they’re really doing is saying “me, me, me.” “I’ve got this guest this on… I’m doing this… We’re doing this… We’re going to be here… Did you hear about that.” That’s not really adding value to people’s lives. I urge radio in their social media strategies to give people stuff they can’t get on the air in those channels. Use these amazing digital channels – text, audio, images, video, instant, long, slow, fast, pause, review – all the amazing parts of digital media – give people new things that would entice them to come to the radio station. 


I like to go to concerts. What would be the cost to have a couple DJs down there with some flip cams, recording people on what they thought of the show and supplementing their programming with cool stuff that is going to get people more passionate to listen to the radio? 

I just don’t see young people getting into the traditional form of radio. They are very, very ear-buds-in-ears, highly mobile, pause, forward, rewind, save it for later. “Radio” as a format just does not click, I think, with this next generation, and it’s going to have to reinvigorate itself because there are only so many 60+ year olds who don’t mind making time to listen to some radio. 

When do people have time to listen to radio now? Even in the car, more and more have built-in Bluetooth or the plug for the iPod. So here’s the choice, I can try and catch your radio show and what you’re saying or I can just download it off of iTunes and pause and rewind it so I don’t miss anything. It seems so much more logical. I mean, I love podcasting because I am literally my own program director. 

So the reason to do stuff that is not redundant to what’s over the air, whether or not you can monetize it, is because that stuff generates more interest in what is over the air that you can monetize. So if you go to a concert and shoot a flip cam video and post it, it shouldn’t be discounted if it is not itself monetizable because it contributes to the engagement that leads to monetization for the over-the-air product. Right?

Yes. In my world, I do my blog and podcast and there’s tons of stuff on my Twitter and Facebook that I give away for free, and again, it’s not about me, it’s about you; I’m always providing stuff that’s valuable to people who are interested in marketing or growing their business online. If you want to pay the $20 or whatever to buy the book, great. If you don’t, free stuff is still coming every day in those other channels, and it’s very different than the stuff you get in the book. 

I think if media companies thought more about how to make the multi-platforms work for what the platforms were made for versus trying to stuff another potato into the sack, they’d be better off. For example, this idea that “we have radio, let’s just put radio on the internet.” It’s crazy to me. I just don’t get where you’re building the interest. Or, as you said, giving them the stuff that they would be more inclined to talk about and share and use. 

You guys, the radio industry, don’t sell content, you sell advertising. 

Right

Broadcasters are trying to figure out how to sell their content. You don’t sell content, you never have; you sell advertising. I think the radio industry either has to figure out an innovative way to become great online advertising people or they need to figure out a way to monetize content on the Internet. Both of them, by the way, are not obvious and easy, and both of them are very challenging. 

What do you say to the broadcaster who says “All of this is great, but times are tough and money is tight. Budgets are cut and we’ve got people stretched across five jobs and you want us to add stuff to our website that isn’t strictly monetizable that’s essentially discretionary labor on our part. How do we justify that?”

So you’re basing the question off of the model that for some reason you’re entitled to the $20 million you made last year? 

That’s correct! 

But it’s false. It’s a false assumption. If an industry makes vinyl records, what do you say to that industry? People are not buying vinyl! Figure out what you’re going to sell – that’s the real reality. 

I hate to be the bearer of bad news but the ability for radio stations to get up in front of their shareholders every quarter and say we’re going to make more money in old ways is just really insanity at this point. No one believes it. No one is buying that unless it’s very, very niche and very, very specific. 

What did you do before for the audience? You did a bunch of balloons down at the local auto dealer, you went out and helped the local children’s hospital. All I’m saying is keep doing the same thing, only now that audience is global. There are 1.5 billion people on the internet. How is that for an audience you might be able to monetize if you’re amazing

I think too many broadcasters are lazy. The content, no offense to people listening, is just not good anymore. It’s very, very rare that you hear compelling radio, sadly, online and in terrestrial. There are exceptions to this – CBC in Canada, NPR in the States. But in general, this industry needs to understand that they have no entitlement based on the fact that they made millions in an era where there was only a limited choice in media. And you only had to buy your way onto that slot so that people would listen to you. Those days are gone, and if broadcasters don’t embrace that, that’s fine. There are 10,000 more people out there who would take $5000 a month in advertising, happily, and build that up to $60,000 a year. Suddenly they are covering some basic costs, and they have their day jobs, and they are really, really happy. 

And so the fundamental challenge is, are you comfortable in a world where you are just going to make less money? It’s still a lot money, but it’s less money. If you look at the model of a radio station, you paid for this license to print money. 

Yes. 

You were the only one who could have access into this certain region of peoples’ ears. And when somebody takes that away, you must recognize at that moment that you need to adapt the business model. And by thinking that going on Twitter and tweeting out that you’ve got the afternoon crew on now, that that’s going to change anything, is total insanity. 

One of the things I like to preach to broadcasters is that what we have, what we still have, is this unique local relationship between the audience and advertisers that we can leverage if we do so in ways that benefit both the advertisers and the audience regardless of whether or not that involves over-the-air advertising. 

But Mark, not so much anymore. You’re right, that argument really worked five or six years ago but in the hyper-local world we live in with sites like patch.com and Google Local, that market is dwindling quickly too. You’re seeing many, many podcasters do some very local niche shows that are getting and pulling really great audiences. 

So yeah, I think that argument worked when the Internet was so global but the Internet is getting very localized very quickly and so that door is closing even quicker than I think they realize. 

So then how do you leverage these relationships while you still have them on a local level? 

From my side of it, it is consummate and constant value. It’s really trying to innovate within the market you have. 

You think about Montreal, where I live. We’re a huge hockey city; we have become a very big football city. We host the Jazz Festival. We host the International Just For Laughs Comedy Festival. So local radio has to recognize that if this is really what people identify with Montreal, we need to amp up content that reinforces and brings that stuff out. If we just go on the air and try and tell people that Michael Jackson died, all is lost. They can get this information from anywhere and everywhere. 

I think it’s that relationship and knowledge of the local area that they can actually work with but again, the value proposition to the consumer has to be increasingly higher because of the tools and media channels the consumers now have access to. 

If radio stations recognize they are publishers, which they are, why not publish whatever is relevant on the web versus what you publish in your traditional channels over the air? 

What if the New York Times had created Twitter? What if the New York Times had created Craigslist? What if the New York Times had created eBay? I mean, why not? They are just publishing platforms. The whole point of the New York Times was to inform and empower a certain community. That’s what these tools do. They just don’t look like printed words on a paper, do they? 

So are you suggesting, or at least partially, that a radio group could enable the publishing of audio content for listeners? 

Yes, and go beyond audio. Maybe the whole point of radio is to go from theater of the mind to theater of the eyes to who knows what. 

I’m sure people are rolling their eyes when I say that, but I’m fine with that because when people first saw Twitter, they thought that was ridiculous, too. When I talk like this, people go, “What’s this guy saying? He’s a lunatic. He doesn’t know our industry, he doesn’t understand.” The answer is I do understand it. I’ve been part of the media and publishing business for a long time. 

We are in the middle of mass creative destruction, and if anybody thinks the old model is suddenly going to come back, the internet is going to go away, and 13-year-old kids are going to start buying radios, putting them on their desks, turning them on, and having friends come over for a dance party, they’re crazy. 

So it’s more than about making radio interactive, it’s more than about putting streams and podcasts online, it’s more than about sustaining the brands into a new era, it’s more than about getting on the iPod. It’s about creating innovative new ways to reframe the definitions of radio, the four corners of radio, for a new generation? 

It’s about publishing content in a way that you can either support it with advertising, sponsorship, or paid models by consumers. That’s what it’s about. Always has been, always will be. 

The only difference now is that that radio’s license to print money has been revoked.

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