The Challenges Of Balance

Necessary Shifts In Style

Like many businesses today, Urban radio is in a constant state of change. Although many Urban-formatted stations are down further and suffer more, we are not alone. Sales are off as much as 30% for all formats. The optimists among us believe these changes will eventually lead to improved systems, cost savings and more efficient management. But in the short term, it means that each of us has a heavier load to carry and that the landscape is just a little different from one day to the next.

Sometimes the harder a complex system is pushed, the more it resistant it becomes -- often in unpredictable, non-linear ways. Frequently the push-back is experienced as a seemingly unrelated symptom: a scheduling problem, the loss of valuable callout research, or an inability to reach a critical goal. The challenge facing all of us in this economy is to find a way to balance opposing forces in the mist of all these cutbacks and changes. And in spite them, we've got to handle and balance these challenges with as few side effects and unintended consequences as possible.

But things could be worse. After all, you could be unemployed.

If the economy continues to tank, surviving in the Urban radio world will become a daily struggle. Your station probably has many listeners and households where both parents have lost their jobs. The recession has claimed lots of victims in the last few years. Again, it's not just Urban radio; other media forms are suffering too. Several national newspaper chains have filed for bankruptcy. Despite this, most analysts predict that radio in general and Urban radio in particular will survive.

After much restructuring and cost-cutting, our stations are leaner than ever and hopefully, well-positioned for a rebound. The problem is we just don't know when. The question isn't just will Urban radio survive 2010 or the next year, but whether terrestrial radio, as we know it, is on an irreversible path to going out of business. Most group-owned Urban stations are languishing in a mixed bag of attempted changes in content, focus and format.

Is Marketing The Answer?

I have spoken with many veteran broadcasters, both GMs and programmers alike, who say that effective marketing is one answer to Urban radio's survival question. Just what is marketing's role in the new economic environment? Or maybe the question is, isn't marketing one of the first things to go in a tough economic environment? For those who believe they can save their way to success and survival, the answer is "yes."

The reality is: Urban, like other formats, experiences attrition when it stops marketing -- and it can be devastating to the brand. A 20% AQH loss is far more expensive than the minimal savings recognized by cutting the marketing. The best brands continue. How can we stop advertising when that's exactly what we tell our clients not to do?

While many Urban stations have been forced to cut back and seen listener erosion, a few top performing stations/clusters have continued to invest in their brand. Today, Urban stations should be communicating more frequently with a smaller group of listeners. We need to target those who are willing to be engaged by tailoring the message to their real interests. The best programs support reasons to increase usage to the stations. Don't waste resources on people who have no chance to move the ratings needle.

Only Arbitron meter wearers or diary keepers move the ratings needle. By utilizing the tools available through the ratings services, we can identify the households that will deliver the greatest return on investment. If a fraction of the market participates in the ratings process, why use a mass media like television or billboards? Instead, focus the target to maximize the results.

We should be working on plans to maximize the impact of the marketing dollars by improving the affinity for a station on behalf of the compatible audience and therefore growing real usage. The process is ongoing, especially with PPM, so we need to develop programs for all stations within the cluster (not just one), and impact every month of the year.

Smart programmers are now looking for their marketing to do more than just reach listeners. They are focused on getting a return on their investment and for the investment to last longer than just a book or two. Ongoing marketing provides the brand substance needed to benefit from changes in the landscape and continually reinforce values.

Despite the proclamation of bloggers and social media proponents, while it can help, the Internet isn't the total answer. Yes, it has ushered in a new era of engagement and drastically increased the availability and accessibility of information, which means more people consume information than ever before. Still, there is nothing to take the place of a well-programmed local station.

Urban radio is especially hard hit and keeps getting chopped by new ratings challenges, dwindling advertising and an ever-enveloping Internet. This is a perfect decompression time to look back and then look ahead. We need to see what we've accomplished and then set new goals. One of the things we've observed is that the so-called cookie-cutter, "off-the-rack" syndicated and voicetracked formats are not driving and keeping new listeners. They're saving their companies money, but at what expense? What the format really needs is a different spin.

Why would we need a different spin? For one thing, so far 2010 has been a tough year for our industries. Urban radio is facing new format competitors with the Internet and other media options, both of which threaten to nibble away at our Time Spent Listening (TSL) and cume. The obvious facts are that iPods continue to gain larger fan bases with iTunes selling millions of dollars worth of songs every week. Then there's the Internet and podcasting, along with satellite radio. Many of these audio forms can be downloaded right onto your cell phone and even into your car now.

Urban radio can expect to be forced to compete with more new forms of technology. Wi-Fi Max is here and with it will come the possibility of easily accessible broadband Internet connectivity in your ride and wireless Internet all over. In some markets, it will even be free.

PPM Challenges

Another spin that is going to add to the confusion is the way radio is now measured. In many markets the future is, or soon will be, electronic measurement. Arbitron's electronic measurement is forcing us to change the way we think and program. For the first time, minute-by-minute instant audience ratings results are available. Children from six to 12 are included in the measurement process and non-commercial radio stations are going to be counted. PPM measures behavior. It measures what you are listening to and when you are listening to it.

So how should Urban stations adjust for PPM? The first rule is to set more listening appointments. Many more shorter-duration listening occasions are being counted by PPM, which is the reason some formats and stations are doing better in the early returns from the PPM than others. The secret is converting those "fickle fingers" to your frequency to at least a P3 or P4 to your station. You must devise programming strategies that give listeners reasons to tune in more frequently. It's now about listeners' retention and minute-to-minute content. If you're not filling it well, some other station or media could benefit.

Next we should look at sample size under PPM. An average market will be about 1,600 people meters collecting listening data. Now if your station's average-quarter-hour (AQH) share is a 6.0 that would translate into an AQH rating of approximately 2.0. What this means is that at any given time there would be on average 30 PPMs picking up your station. Keep this in mind and you begin to see why super-serving those loyal P1s is so important.

Urban stations stand to benefit by understanding how working and non-working people listen to radio. Why is this important? There are several reasons. For one, working people are driving ratings. Early PPM data shows employed listeners spend approximately 16 hours a week listening to radio compared to 9 1/2 among their television infused counterparts who don't work. Working people have more opportunities to tune to radio during their commutes and while working. With PPM, working persons provide the largest quarter-hour payoff.

If half of all your P1s change their favorite station in less than six weeks, then it becomes critical to differentiate your loyal P1s from those who are not so loyal. Ultimately you want to increase your loyal P1s and then direct your not-so-loyal P1s to your dial position. You want them wearing a meter tuned to your encoded signal.

Because the PPM data shows lower Time Spent Listening (TSL) than the diary, obviously, boosting TSL is a critical objective. Urban stations especially need to structure their programming to keep the average listener listening longer for every tune-in sequence.

Going forward, we're going to be forced to look at the challenges of balance a little differently and go a little deeper than just the surface. Winning in today's economy is going to require not only front-spin, but also back-spin.

Urban programmers need to take full advantage of the latest insights, strategies and tools to navigate through uncertain times. We need to maximize innovation and tackle the toughest problems. Why? Because all the easy problems have already been solved.

Word.