Hear 2.0

Kill your Radio Station's "Sacred Cows"

Beau Fraser is co-author of the new business bestseller, "Death to All Sacred Cows: How Successful Business People Put the Old Rules Out to Pasture." Fraser is also managing director of the international advertising and corporate identity firm The Gate Worldwide. I spoke with him about the themes of the book, and what they mean for the radio industry.

Here is the full audio of our conversation. What follows is a heavily edited transcript


MP3 File

Beau, what is a “sacred cow” in the business world?

A “sacred cow” is a rule, a standard, a formula that we, in business, blindly follow because that's the way things have always been. At one time those rules, those standards, those formulas may have made sense, but unwittingly they became “sacred” over time even though the world, the consumer, the business, the industry has changed. And, unfortunately, a lot of businesses don't recognize that the rules have changed and the world has changed, yet they still use these outdated criteria.

One of your chapters is “Follow the Leader.” What makes that a “sacred cow”?

At The Gate, when a client is in trouble they will often look wistfully at their competition who's doing very well (and is invariably No. 1 or No. 2 in the category) and say, "Well, “Acme Nuts and Bolts” did that, we should do that as well." The problem is that Acme was successful for things that went well beyond whatever strategy or idea they had. That strategy or idea they implemented was successful because of things such as distribution channels or operational issues or brand issues or geography issues. If you can't duplicate those, you certainly will not be successful if you try to borrow their strategies.

Certainly you need to keep an eye on what the competition is doing, because you want to stay abreast with them, but if all you do is duplicate what they're doing, all you're doing is keeping pace.

For example, while a radio station my have the same format from one market to another, that radio station in another market may be successful for things that may not exist in your market. What I always tell our clients is to keep an eye on the competition because you don't want them to get too far ahead of you, but spend more time looking at your own business and figuring out what it is that you do very well and work harder on doing that even better.

If all you do is match your competition's strategies, all you're doing is keeping pace. And in most businesses keeping pace is not enough.

Okay. Here's another “sacred cow” from your book: “Focus on the numbers, and the rest will take care of itself.” Now, in radio there are an awful lot of people focusing on the numbers first. What are we doing wrong?

Let me illustrate this very personally. My responsibility to The Gate is to deliver a certain amount of revenue to my holding company. What they tend to do – and most companies do this – is to say to the general manager, "You need to deliver this much revenue." But that doesn't give really clear directions. To me that's really a goal as opposed to telling people what it is you want them to accomplish.

So suppose instead that I tell everyone inside our organization that our goal is to be agency of the year by 2011. Now, I know that if I achieve that, all the wonderful numbers that investors and employees and owners want will come, but to me numbers are a byproduct of having achieved something else. So I think it's more interesting to think of what it is we want to achieve – for example a radio station could be “the most favorite radio station in the marketplace” which is more an emotional measure rather than an actual number measure. But if you are the most favorite radio station in a marketplace, all the things that you'd want, such as reach and frequency numbers as well as listenership numbers will come. But these become a byproduct of a larger, more interesting goal.

Now, here's another one, Beau, from your list of “sacred cows.” It's called: “Don't screw up.” Talk to me about that one.

I like that one because starting off in the business world I certainly screwed up a lot. But the problem, for instance, is if you tell your child, "Don't screw up. Don't screw up. Don't screw up," they're going to spend more time trying to figure out ways to not screw up rather than coming up with a more interesting way to do something.

Look at Pfizer coming out with Viagra, which was not a goal but something discovered by constantly failing on a drug that was conceived to do something else. So very often by making mistakes you can achieve something that is much greater. I'd rather tell my people, "I don't mind if you make a mistake, as long as you can give me a rational reason for what your goal was." As long as you learn from your mistake, I think you're going to come up with far more interesting solutions.

You can't stifle creativity, and I think that, for me, is what the sacred cows are all about. They hinder progress, they hinder creativity, they hinder original thinking, and if you block those out, if you eliminate those, you're more likely to succeed – and focusing on making sure you don't screw up is certainly one “sacred cow” that needs to be very gently and humanely put out to pasture.

So then, Beau, what you're saying is that part of creativity itself is screwing up?

That is correct. But I prefer the word imagination. Those who have imagination spend more time thinking about, "What if? How about?" as opposed to using some of the words that hinder.

When I'm talking to a client, and I present an idea and they reply, "We've tried that before and it didn't work," and I ask them why it didn't work, and they can't answer – then I know I'm in the presence of a sacred cow.

Or even the worse one is someone looking to create an easily repeated formula, because, by definition, a formula always works – you can't argue with a formula – so when someone says, "What’s the formula?" I know that I'm in the presence of somebody who holds onto a sacred cow. And all those things hinder original thinking.

If you think about some of the great breakthroughs in the business world, it was invariably something that was totally unexpected. They had the courage to try it. And it doesn't mean that you have to spend an awful lot of money. If you're a large organization and you try something and it fails, a failure can be quite devastating. You can certainly try it small, and make changes as you go to market.

Okay. Here's another one of those “sacred cows” in your book: “Branding is expensive.” Well, branding is expensive, isn't it?

I think the assumption is that when people say, "Let's brand something," they automatically think of 60-second commercials on the Super Bowl. But to me, branding is an intellectual exercise, and I don't think intellectual exercises are expensive. Depending on how you execute it, your branding program can certainly be expensive. But even if you don't put any communications behind it, even if you don't put any media behind it, what you should always do is act like a brand. And a brand is what defines you as being different, better than the competition, and gives potential perfect customers reason to choose you. A brand is giving a reason to choose.

To me, the best definition of a brand that I've heard is this: “A brand is what you get when you add differentiating substance to a product.” I like that definition because it tells you that you the client, or you the marketer, are in control, and you get to decide how you want to define the brand.

And, to me, the other part of it is differentiating substance. Very often when I read brand descriptions of a product that comes from a company, and to me it sounds very blah, blah, blah, or I've heard it before. So it really has to be differentiating, and it has to be substantial – something that people can really sink their teeth into.

Meanwhile all of that is an intellectual exercise and has nothing to do with spending.

To me branding is a noun and not a verb.

Passion, Pop, and Radio

From Seth Godin:

That bell curve [above left] represents acceptance by the focused/excited/tastemaking community. Those are the people who love microbeers and haute couture and Civil War memorabilia. Like all market curves, there's a sweet spot. Go too nutsy on us ($90,000 turntables, for example) and even the committed will flee. Go too pop, though, and we'll avoid you as well.

Simple example: Jazz. If you do atonal world jazz played in the dark underwater, few people will come. On the other hand, you won't get many jazz fans at a Spyrogyra concert either. Too pop.

The bell curve [above right], you'll notice, is bigger. This is a second market, a bigger market, the market of pop. These are the folks who go to the Olive Garden for a nice italian meal instead of the authentic place down the street. They too want something that's not too edgy and not too (in their opinion) trite.

The reason you need to care is that gap in the middle. Every day, millions of businesses get stuck in that gap. They either move to the right in search of the masses or move to the left in search of authenticity, but they compromise. And they get stuck with neither.

This is, of course, an issue for radio too. Because our ratings are a function not only of how large our audiences are but of how much time each listener spends with us, we have ratings winners with small audiences who listen more and large audiences who listen less. The ratings losers are, more often than not, the stations that want the most of both.

The toughest strategy is the one that wants it all: Big audience and heavy listening. Choose one, says Seth, or achieve neither.

Even dentists face this challenge, says Godin:

Should you be the most expensive, best trained, most extreme dentist in the world, catering to the edge of the passion market, or perhaps develop a chain of $19 five-minute whitening shops for the outer edge of the pop market?

You might get lucky and end up with a sweet spot accidentally. Inevitably, you'll itch to move to the other curve (cause it's bigger or because it feels more authentic) and I worry about your ability to do that.

The best choice is to choose.

Does your station REALLY have a position?

I feel almost silly going so far back to the marketing basics that I'm actually writing a post on positioning, but this graphic says so much in so few words, that I wanted to share it with you.

So complete this sentence for your station.

Your station is the only [blank] that [offers blank benefit].

If you can't complete the sentence, you don't have a position.

More here.

And remember, there's a VAST difference between "having a positioning statement" and having a position.

CBS fights new media fire with fire

Yes.

New, from CBS Radio:

CBS Radio Station unveils the Player.Play.It media player, which will offer a [way to] group stations together. The player will also feature large space for contextual ads that displays marketers’ slides. It will also feature new internet-only stations, such as archives from New York City classic rock station WNEW. As for the personalization function, users can type in an artists’ name and build a playlist based on automated recommendations. The player will also boast e-commerce links and synchronized banner and audio ads.

Ever since CBS's acquisition of last.fm, this development has been coming.

Look for CBS's competitors to step up to the plate.

Former Rogers Media Radio CEO Gary Miles on Radio's Future

"20% of your revenue should come from digital media within the next five years."

That's one of many messages from Gary Miles, the former CEO of Radio for Rogers Media, one of Canada's largest radio broadcasters.

Gary now works with Mass2One, the listener engagement company. And this is a presentation I saw Gary give before a room of M2O client stations.

I've tried to trim out the M2O-oriented parts to focus on the larger message, elements of which will be familiar to regular readers of this blog.

Gary has visited a lot of radio stations. Yet, as he says, "most have no idea what to do" about the new media trends taking shape today.

Gary's speech is a call to action.

Listen.


MP3 File

The CW uses the Web to get viewers back to TV

At least, that's how they hope it works.

Why don't you do this more with your radio station?

From Advertising Age:

The CW is already trying to herd its online audience to the living-room screen. The network has refused to stream the last five episodes of drama "Gossip Girl" and has prompted consumers to take part in "watch and win" contests that require people to watch the program on TV in order to win a prize. The season finale will include a tie-in with Verizon Wireless and will prompt viewers to search for the "XOXO" symbol -- the title character's famous sign-off -- and text message their answers to win.

More is on the way for next season, said Alison Tarrant, the CW's senior VP-integrated sales and marketing. While the network has emphasized online "extras" for digital audiences, "we are evolving our strategy, giving these passionate fans more reasons to come back and watch their favorite shows live on television," she said, adding that the network is looking at way to make episodes into events. Among the ideas being considered: having fans send text messages to gain hints of coming plotlines, music downloads or even message from actors; mini-episodes that start on TV, move online and come back on TV again; and contests for prizes viewers can win by watching the show on TV.

As long as "old" media makes a dollar for the same impression that "new" media makes a penny (forgive the generalization), there will be an incentive for traditional media to use their new media assets not just to distribute content but to move audiences to where those audiences generate the most value.

This, for example, is why Iron Man is on the Big Screen this past weekend and not yet in the Best Buy.

In my opinion we don't spend nearly enough time providing online content and incentives which can serve to motivate listeners to boomerang back to where their listening counts most:

Our own air.

How to Ruin your Listener Database

Last week I heard that some companies who work with radio stations are convincing those stations to use their digital media assets to provide either the emails or telephone numbers of station VIP listeners (or whatever your database is called) to clients.

I'm not saying these companies are encouraging YOU to email or call your listeners on behalf of clients. That's fine. I'm saying part of the buy involves your station providing these emails or phone numbers DIRECTLY to clients who reach out to YOUR listeners ON THEIR OWN.

This is not only wrong, it's dumb. And don't let anyone entice you into this sour bargain.

Believe it or not, some very big stations in very big markets are being suckered into this.

In all communications with YOUR listeners YOU must be the agent, not your client.

If you give up phone numbers or emails to your clients, not only are you handing over the goose that lays the golden eggs, you are also violating the trust your listeners have with your station. And if you violate it once you will never earn it again.

Don't do these deals, please!

I finally figured out how to Profit from HD Radio

So I'm meeting with a wonderful Christian radio client who relies on direct financial support from their listeners, like many in their format.

They are very successful thanks to a clear, broad, mainstream focus for their stations. But this also means some of their original listeners who are getting older find their tastes less satisfied by the station than they used to be.

The problem is that some of these older listeners provide very strong financial support to the station, even remembering the station in their estate planning. This makes them VIP listeners of a very particular kind.

"How many are in that category?" I asked.

"Maybe 300" they said.

"Here's what you do," I suggested. "Give them all free HD radios. Then find out exactly what those 300 people want to hear: Send them a questionnaire and have them check off their favorite Christian music artists. Then create an HD channel which plays all the hits from those artists and all the favorites for that audience of 300 listeners."

"But how old do we go? What format will this be?" They asked.

"It's not a format," I replied. "It's the Christian songs which best suit these 300 people."

The end result will be a vastly improved and direct relationship (after all, you're not only giving them a free radio but you're programming a radio station exclusively for them), vastly improved loyalty and satisfaction, and - I suspect - vastly improved financial support.

And isn't a service personally tailored to that degree entirely worthy of magnanimous support? Especially when that support goes to fund a profound spiritual mission?

A Christian radio station is much more than its frequency. It is the spiritual nexus for its fans. The kind of brand expansion I'm describing is entirely mission-appropriate.

End result: A logic for HD radio.

Imagine that.

And by the way, this same logic could apply to Public Radio stations and their Classical Music VIP's.

Is this the way HD Radio was supposed to work for our industry? Obviously not, but if it accidentally solves a different problem, then who cares?

After all, the sweetener in Splenda was discovered when the scientist trying to find an anti-ulcer drug accidentally licked his fingers.

Too bad HD radio leaves such a bitter aftertaste.

Your Attention will be Rewarded

Remember Apple's "Think Different" print campaign featuring the faces of legendary Earth-shakers? What you may not remember is that none of these faces were identified in the ads, and not all of them were world-famous faces.

You either recognized them or you didn't. You were either in the "club" - and congratulated yourself for being so - or you weren't.

Your attention was rewarded. The marketing became a puzzle, and folks love puzzles.

Likewise, you can watch an episode of The Simpsons several times and see new things each time. This is no accident. The makers of The Simpsons deftly overlay the gags to intentionally reward the kind of attention that comes with repeat viewing.

When you notice these subtle gags, you know full well not everyone does. And that makes the recognition all the more fulfilling.

So I was thinking: What do you do on your radio station that rewards extra attention? That is, what do you do that will cause some of your listeners to pat themselves on the back for seeing or comprehending what they know many other listeners will miss?

If we want listeners to pay attention, we have to give them something worth paying for.

But do the Ads produce Sales?

I talk a lot nowadays about the rise of accountability in advertising, even as radio remains obsessed by "reach," which rarely promises anything about effectiveness.

By "accountability" I do not mean guaranteeing that as many ears hear advertiser messages as we promise. I do not mean more accuracy in counting those ears.

I mean proof that our medium - like any other - leads to the outcome the advertiser usually wants: sales.

This just in from Google's Eric Schmidt via MediaPost:

"[Increasingly,] the principles of marketing...will be augmented by analytical tools," Schmidt said.

The goal for Google is to develop technology that delivers actionable metrics, making it easier for advertisers and agencies to optimize and measure campaigns. More advertisers will have the tools to expand into multiple markets that can test consumer interest in products and services.

Take, for example, Cadillac's click-to-play video ads. The car manufacturer had its ad agency create 13 versions of an ad, testing them in multiple markets to gauge consumer impact and the correlation between viewing the ads and the actual sales. Chrysler allowed consumers to customize the Chrysler 300, but the carmaker did it as content to draw in consumer engagement.

Honda sponsored a concert. Google engineers built technology that allowed concertgoers to ask the band questions and get responses. Schmidt says these will become the defining models for advertisers over the next 10 or 20 years.

For Google, advertising nirvana occurs when the search giant can return the exact answer for each query, accompanied with one perfectly targeted ad. "Eventually, maybe what we can do is guarantee advertisers who pay us money--and this is my fantasy, the sale," Schmidt says. "If we can get to that level of that specificity, advertising will no longer be a marketing expense. It becomes a sales expense."