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Our Reality

Whether we admit it or not…

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Doug, As you and I have discussed many times I love the concept. But a 9% lift in ratings (for the Turner Network) is not enough to justify the significantly higher rates they’ll need to charge for a 50% reduction in revenue. Very few companies – who don’t have a subscription-based model for generating revenue – have the cojones to take that leap of faith. And, as pointed out in this article:

“A commercial in a show with fewer other ads should stand out better, at least in theory, but there’s little proof that it’s actually worth a higher price.”

Thoughts?”
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That’s from a GM in an emailed response to one of my columns on the necessity of cutting the number of ads on Radio.

The original column was sparked because the Hallmark channel on cable has drastically cut the number of ads in their shows and it has produced higher ratings.

So, here’s my answer…

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I think there’s two parts to this: content with very strong emotional content and appeal, and the decision to face reality about how content is accessed today.

And before I even start trying to answer your question, remember that I think advertising on TV and Radio, in general, produces far better results than advertising online in any other form

(Of course, Google’s search is an exception: consumers trying to find something they’ve already decided to buy.)

What we in Radio have never tackled is whether our advertising works, and when it does, why it does. Jerry Lee may still be researching this in Philadelphia, but I haven’t heard of any industry-wide support for the idea of advertising accountability.

It’s the idea that online can produce “proof” that I think most advertisers find so appealing.

CMOs can whip out graphs and charts and all sorts of very explicit numbers “proving” how many people “engaged” with their ads on Google or Facebook.

But more than one study has found that online ad engagement is wildly over-stated (what a shock!) and some of the biggest advertisers in America are re-thinking their tactical use of online ads, P&G being one of these.

The proven truth is that most (meaning probably some number higher than 90%) online ads don’t work.

In fact, TV and Radio work better for almost every product, but no one really knows why, and I think this has surprised a lot of open-minded marketing experts. And, we don’t have easily accessible, clearly understandable ways to prove it.

And because of these factors, and the ubiquity of choice for consumers, be they watching TV or listening to radio, a lot of the ads on broadcast media are simply skipped.

I don’t think you believe that listeners sit passively in their cars and wait through our interminably long stop sets hoping they love the next song, thereby making that wasted 7 minutes worth it. We all know, and we have always known, that listeners — especially in cars — hit the button when the stop set starts.

So, a part of me says that Hallmark is simply facing reality, acknowledging that the more spots in a break, the less chance any of them is actually watched.

I believe that’s the theory behind the recent NFL idea of running either really short spots (6 seconds) or only one 30-second spot, beside the image of the game being broadcast, so viewers don’t skip through their recording or hit the TV remote to see if the other game is in a stop set too.

It doesn’t matter how cheap the spots are if no one sees or hears them and if their very presence — and this is the problem for online advertising — produces an immediate sense of frustration at the intrusion. How open are most people to an ad message when they’re pissed off that the ad has interrupted what they want to see or read or hear?

What the Russians did so well on Facebook trying to influence our elections is creating individualized content — not ads! — for specific people, and often for people on both sides of an issue, and then targeting that to specific people, often only a very few people (less than 10).

They produced highly emotionally engaging posts designed to be polarized because that is the very thing that generates passion and sharing. They let the FB targets viralize this content.

We know listeners hate ads.

Yet we’ve spent no money, as an industry, trying new models.

We’ve actually cut budgets for ad writing and production.

Most local spots, and many national ones too, are produced as cheaply as possible, meaning sales people write the copy and whoever’s standing around at any given moment reads it.

How many units do you run in one hour? How many units are the maximum for any one break? Include live spots and 10-second (meaning more like 20-second) sponsorships too.

If you cut one unit per set, no one will notice, and you’ll just lose that revenue.

But if you cut half of your units, people will notice. And if your product is appealing enough to begin with, that will increase their attention and devotion.

Is it a risk? Of course. Should any station that tries this be prepared to see revenue fall? Of course.

But pretending listener behavior is not what our own behavior would be, meaning hitting the button at the sound of the first spot, is sticking our heads in the sand.

Our real goal, our real effort, should be in producing ads that are highly effective and that we can prove are highly effective. We should be as invested in the success of any client’s ad campaign as we are in selling that schedule to begin with.

We both know that’s not Radio’s reality right now. Just get the revenue on the books, this week.

99% of the “civilians” I speak with about Spotify (Pandora is already dead for most) NEVER rave about the breadth of the playlists. What they invariably mention first is, “NO ADS!”

So if Radio doesn’t try to find some way to address the reality we face, even if that includes accepting less money, a profit margin of 10% rather than 30% or more, we will continue to make streaming music more and more popular.

Hallmark is facing reality. Their reality is ad-skipping on DVRs. Their reality is Netflix and HBO and Amazon Prime and Hulu.

Our reality is music streaming services.

Our reality is finding the number of units that listeners will be willing to accept (which will be much, much smaller than it is currently) in order to hear their favorite songs and have new favorite songs introduced to them — so they still feel hip and young — and understanding that part of Radio’s appeal is human connection, the voices between the songs, which Spotify isn’t trying to duplicate.

Ok, fire away. I love these discussions.

DE

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