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Product + Knowledge + Passion = Revenue

In the radio business, there’s this constant struggle between what matters more – generating revenue, or delivering great programming. Clearly you need both to make a difference, but not all brands experience success in both areas.

Given my background in programming, I’m sure you’re going to be stunned to learn that I lean first towards providing quality programming. However, I’m not one of those people who turns a blind eye to sales, or minimizes the importance of being profitable. Anyone who’s occupied a conference room with me knows that I’m going to defend the integrity of the programming at all costs, but if I reject an idea, I’m likely to counter with “but here’s what I will consider”.

We can play the chicken or the egg game, but in life, listeners have a choice of whether or not to invest their time in a brand. They didn’t turn on your radio station, listen to your podcast, or watch your personality’s video, because they were looking for an advertiser message.

The client didn’t place their ad budget on your radio station because they were concerned with helping your company turn a profit. They did it because you have something of value to offer – access to people!

With that access comes the opportunity to place effective messaging in front of an audience by aligning the advertiser with things that the user considers cool (talent, features, play by play, etc.). But how are you supposed to take advantage of the power you yield, if you don’t fully grasp the vision of the product, and the reasons why it connects?

I’ve been fortunate to work with some great Market Managers during my career. Since entering into business for myself last August, I’ve had the pleasure of meeting many more who truly understand the secret sauce of their radio stations. You can’t measure a brand’s success solely by ratings numbers, and you can’t make investments by only looking at expenses vs. revenue earned. If that were the case, this format wouldn’t have more than seven hundred stations operating in it.

One area today which is drawing larger industry concern is the product knowledge, and interest level, among market managers, and sales leaders. Some of that’s brought on by individual decisions, but most of it is the result of structure, pressure, and inexperience.

Selling sports isn’t easy. You have to use the emotion of a local team, the persona of an on-air talent, and the passion of the audience to create deeper interest. Ratings help, but for most sports radio brands, they’re not going to be the reason that local and national clients spend larger dollars on your station. If numbers are part of the decision making process, music stations will get more respect, because they perform better in the 6+ and Persons 25-54 demos, an area that only a handful of sports talkers do.

If you want to strike a chord with a buyer or client, you need evidence to make them look beyond the ratings sheet, especially if you have a competitor in your market.

Have you ever walked into a meeting with audio clips of your brand and your competitor, and let the client hear why it makes sense to invest more in your brand? If you want to draw an emotional response from the client or buyer, watch their reaction when they hear the way their business is presented. Few advertisers enjoy hearing their commercial run on your competitor’s station during an eight minute commercial break, let alone as the final unit.

You can point out the mistakes on your competitor, but when you do so, you better have your own house in order. The last thing you want to do is highlight how the brand you compete against treats a client, and then have the same issues occurring on your own radio station. If you can show a clear difference of the programming, and how a sponsorship works better on one brand than the other, they’ll give deeper thought to doing more business with you.

Here’s another idea. Have you ever taken a look on social media at the reaction of your audience when your on-air talent says something bold, or the station announces something big? The passion is off the charts, and the response can be overwhelming. I used to conduct quarterly Twitter chats when I programmed 95.7 The Game in San Francisco, and there was never a shortage of activity.

When you can take that emotion, and large sample-size, and put it visually in front of people, the evidence stands out. It tells them that people care, and gives them incentive to want to tap into your audience. It’s even more magnified if a radio station carries a team’s games, or has a weekly call-in arrangement with a popular local athlete.

For example, I negotiated a deal with Buster Posey, and Matt Cain of the San Francisco Giants years ago. Their call-in segments didn’t exactly set the content bar on fire, and their ratings were slightly higher than a few other quarter hours on the station. But, if you called a local advertiser in the Bay Area, and told them you were aligned with Posey and Cain during the Giants championship run, do you think there might have been interest? Of course there was.

When the two players met four contest winners prior to an A’s-Giants rivalry series, those listeners became fans of the radio station for life. If clients receive similar treatment, and are introduced to people that they view as heroes, and see as being a part of something that matters to them personally, they pony up to be connected to it.

Understanding what goes into selling sports radio is more important than ever, and the reality is that many markets feature staffs that have grown up in radio, and are trained on selling spots and dots. They don’t necessarily share an enthusiasm for the programming, and they look at digital and social media sales the way kids today view common core.

To be fair, it’s really difficult to sell all of these things, and be extraordinary at it. It’s even harder when stations have lean sales teams with big revenue expectations.

If sports is a local/direct sell, and your sports station is operating in a top 20 market with three or four sellers, and a group of other reps who are focused on selling other formats but lack an emotional attachment to the brand, you’re going to miss the mark. I don’t believe that every salesperson has to love sports to sell it, but, if they don’t know and love the radio station, the on-air talent, the way the brand connects with the audience, or understand why it’s special, good luck being profitable.

It’s also necessary to have a solid grasp on the assets you have at your disposal. Some programmers prefer to put it on a grid, some lack attention to detail which can make it tough for a seller to navigate thru, and others do neither because they’ll put anything on the air that sales asks of them (even if it weakens the brand) just to gain a client’s business.

In each scenario, success is possible, but I believe you help your own case by making it easier for everyone to follow. Here’s an example of how to lay things out for your sellers. It’s an edited version of an old features booklet I created in 2011 in San Francisco.

In it you’ll find the details of how each feature works, what day/time they occur, and what each sponsorship requirement is. This is helpful to sales teams who are trying to create Powerpoint presentations to place in front of potential clients, and it’s a great way for them to be reminded of how the brand operates, without having to constantly bang on the programmer’s door to get their questions answered.

The original booklet I created had other elements in it, including Raiders play by play, weekly call-ins during football, baseball, and basketball season, digital media opportunities, and something I refer to as “Beachfront Property”. Those assets are the biggest on the radio station. Everything from owning the name of the studio, to sponsoring the phone or text line, to being the featured sponsor of the station’s largest events and promotions.

If you’re charged with managing a sales team, and they have all of those assets to sell, in addition to commercials, web banners, Facebook mentions, and lord knows what else, is it realistic to expect them all to be monetized? I’ll help you answer this one, the answer is no.

Chances are, most of the sales team won’t remember half of the assets on the station because they’re under the gun already trying to sell out commercial inventory. If a station runs twelve to sixteen minutes of commercials each hour, and there are thirteen prime-time hours (M-F 6a-7p), and eighteen weekday hours (M-F 6a-Mid), that means they need to sell between 150-300 spots per day. That’s assuming they’re all :60 seconds in length, which they won’t be.

When you factor in :30 second spots, which are the usual length of most radio commercials, plus :10s and :15s, now that inventory number jumps even higher. And I haven’t even talked about digital, mobile, and social assets, promotions, local and national play by play, big station events, or advertiser demands to create specific opportunities.

The reality is that the radio station’s assets will likely never be fully monetized, and reducing them probably makes more sense. But, the second you tell a sales team that an opportunity is no longer available, all hell breaks loose.

Equally important is for the programming team to understand that just because a feature isn’t sold, doesn’t mean you shouldn’t do it. If it is sold, that also doesn’t mean you deserve an increase in pay. In many cases, the sponsor is given the feature sponsorship as a bonus, to close a bigger inventory deal on the radio station.

This all brings me back to my point about the lack of understanding and interest in sales leaders towards the product, its assets, and the unique qualities that make a radio station great. You can’t take advantage of opportunities if you don’t know how they work. If your focus is on making sure your sellers hit their revenue numbers, and move every unit of commercial inventory, that’s understandable. However, there’s likely going to be less focus placed on product integration, digital/social/mobile assets, and training people which means at some point you’re going to come up short somewhere.

We realize the business world is shifting to the digital space. Just last week ESPN went on offense to try and slow down providers like Netflix, Hulu, and Amazon. Why? Because they see their power reducing, and they know the money is heading in that direction.

Have you seen how Facebook, Google, Twitter, and Apple are performing? Google has grown 17% year to year in Q1, raking in over twenty billion dollars. Twitter is up 36% year to year while generating nearly six hundred million dollars. Facebook has climbed 52% year to year, while turning in more than five billion in the first quarter. Apple has grown by 2% year to year, en route to generating over seventy five billion dollars in the first quarter.

There’s a specific reason why I listed those companies. Three have been in existence for less than twenty years, and one experienced modest success in the 1980’s before falling on hard times. Its resurgence has taken place during the last two decades! Google entered the digital world in 1998, Facebook was born in 2004, and Twitter arrived in 2006. Apple was launched in 1976, but most view 1997-2016 as the time when it’s truly become one of the world’s most dominant companies.

How on earth is it possible that these companies which have enjoyed massive success for only two decades, could overtake the entire radio, print, and television industry for advertising revenue? The media business we grew up in has over a half of a century to put itself in position to be untouchable, yet here we are in 2016, and we’re all using these three platforms to help promote and grow our own businesses. Some would even say that without them we’d be in trouble at reaching our audiences.

Am I not the only one scratching my head, and wondering how that could be possible? Not only did they start their own companies, but they created an entire new media space too. We’ve had access to a megaphone, and a relationship with the auto industry which has given us great accessibility to people, but still couldn’t figure out how to grow revenue the way each of these groups have.

Here’s another scary fact that addresses one of radio’s bigger issues – each of those businesses have been built by someone who bled product first. That’s not always the case in radio.

Before Mark Zuckerberg started worrying about stock prices, and quarterly earnings reports, he was a programmer. He cared first about creating a product that mattered to people, before learning how to become a successful businessman. Here he stands now at 31 years old, listed as one of the top 100 wealthiest people on the planet. He figured out how to give a speech, excite investors, and cut deals with business leaders, but not before understanding every aspect of what made Facebook important.

Apple, was founded by Steve Jobs, who was an inventor with a large focus on product development. Before he spent his energies trying to sell a room full of people on the power of the iPhone, iPad, iPod, and iTunes, he concentrated on making great products that he thought people would use. Once he had a great product to offer, he learned how to market it, sell it, and become the face of the company.

At Twitter, Jack Dorsey led a group of four in bringing the social media network to life. He was a programmer, with a passion for innovation, and that enthusiasm for creating technology has earned him world wide praise. He sits currently in the CEO position, and is tasked with growing the business moving forward. Who better to explain why Twitter matters, and how it can be used to grow a business than the guy who helped create it?

For Google, Sergey Brin, and Larry Page were computer scientists who met at Stanford, and spent all their time in dorm rooms tearing thru computer equipment, and testing out different concepts in order to create the world’s most powerful search engine. By investing their time in developing an idea that they felt could change the world, they did, and in the process became two of the top 20 richest people in the United States.

Teaching someone how to create powerpoints, discuss ROI, lead a meeting, and operate a budget isn’t difficult. But, knowing a brand, creating a vision, selling its value, and producing the right strategy will take you further. Certain leadership skills can be taught, but if your laptop crashes, and it’s just you and the advertiser face to face, can you look them in the eye and make them believe in what you have to offer?

Natural born leaders are built to perform in front of anyone. They can sell their beliefs to any audience because it’s part of who they are. They live and breath their products, and don’t need a phony story, or fancy powerpoint presentation to convince people to invest with them.

I can’t explain why radio programmers don’t warrant deeper consideration to run companies or clusters. If you have the answer, please let me know. Dan Mason had a strong background in programming, and did very well operating CBS Radio. Bruce Gilbert had a great track record when he joined ESPN Radio, and his results at the network speak for themselves. I’m sure there are others out there who can make the same difference.

The point of this isn’t to lessen sales leaders, or suggest that programmers should run the world. It’s to explain the importance of connecting with your products, and understanding why they matter. We can’t operate in a silo, and expect one-trick ponies to be dynamic across multiple platforms. It’s just not realistic.

Today, we expect air talent to be skilled at hosting a radio show, writing a blog, interacting on social media, creating video, and being an advocate for advertisers, so it’s only fair that our revenue generators be proficient at maximizing on-air, online, and on-social sales. Before they can be successful in any of those areas though, they’ve got to familiarize themselves with the assets on their brands, and know why each is special to the audience.

Facebook, Google, Apple, and Twitter took over the media world, and changed the revenue game in less than twenty years. Others will do the same during the next two decades. If we want to avoid becoming the new age dinosaur, we’ve got to excel at creating unique and powerful content that connects with an audience, distributing it across multiple platforms, and having well rounded business leaders who understand how to maximize the assets. Without it, we might as well borrow ESPN’s ad campaign against streaming providers and pray that it works.

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