If anyone in radio wants to know what works in ecommerce then listen to these power players and what they do to be successful.
Sarah Lacy CEO of Pandodaily (a must read) talks to executives from Birchbox, Thrillist, One Kings Lane, and Warby Parker about what makes a successful mobile app in ecommerce.
20 Minutes with Seth - Priceless
Put everything Seth is saying through the “radio funnel” and pay special attention at the 14:14 mark and apply it to yourself. Enjoy.
In a recent Lefsetz Letter, Bob made 20 points about radio and he says in #7 “it’s the ads that will kill terrestrial”. And yet he says in #8, “if you’re waiting for format innovation and fewer commercials…you’ll be waiting forever”. Radio’s Innovators Dilemma is all about ads and new monetization vehicles!
How does radio win against all the other platforms we compete against for their limited attention? Valuable, relevant content (great music/entertaining/informative personalities), unique listener experiences and equally important IMHO is far fewer commercials!
And yet radio is doing the opposite…getting rid of talent and running more commercials than ever. Yes, commercials are an issue that no one in radio addresses but everyone on the Internet does. Have you ever wondered why there aren’t any radio and Internet partnerships? 92% of the population listens to radio each week and Internet platforms don’t find value in radio’s built in audience? Could it be…?
Broadcasters have a “give me fish today” mentality instead of “teach me to fish so I can feed myself for life” (My only biblical reference). No one talks about is the limits of the ad model they just want the money. Radio advertising is not a growth strategy as you can only run so many and charge so much. Magna Global says digital media will be the only media category to show significant improvement in the U.S. this year at 11.5% while radio will see flat revenue. So in the mean time broadcasters only focus is “gotta get the quarterly numbers up” and continue to abuse the listening environment with commercial breaks that are regularly 9-11 elements multiple times an hour (look at stations in the top 5 markets and you’ll see this all over). It makes radio un-listenable during the PPM bow-ties you hear all across the radio dial. It’s no wonder on-demand music services get the sampling they do. If they ever learn anything about how to program those personal playlists then look out.
Great talent are just conductors for the band on the Titanic because as good as they are they can’t neutralize the effects of the commercial wasteland that is making 25-30% of each hour a total tune out. Advertisers are voting with their dollars and trying any other platform. Who wants to be element 6-7-8 etc. in a set? If this attitude doesn’t change then radio is guaranteeing self-destruction. To stop the abuse, the focus should be on new revenue streams, partnerships and revenue sharing. So what do we do? Clear Channel knows the value of fewer commercials as even today they signed on a new station near Seattle, “Now,” which debuts with the standard-issue 10,000-song commercial-free sign-on stunt. So where is the new revenue going to come from? BTW - Social will not save radio.
James Mitchell said – “You don’t have to be the smartest person in the world on a subject. You just have to be smart enough to figure out who the smartest person in the world is, and then copy the hell out of him/her”.
There are new e-commerce businesses created everyday that radio could copy/create or partner with. So instead of being openly hostile to digital change, radio needs to get off the commercial crack pipe and learn (copy) from the platforms that are getting all the ad dollars? It’s only through generating revenue from other business models that radio can reduce the commercial load. By doing so commercials become more valuable and the platform becomes a better listener experience which will extend time spent listening. Yes, less is more in every way. The first to do this will win very big!
Andrew Lee explains why competitors and big markets are essential for your startup’s survival. He says, great surfers need great waves. Without them, it would be impossible to see their true talents.
Yes there is a reason that Facebook has triple-downed on photos. There is a reason why Pinterest is off like a rocket as the #3 sharing site on the web. There is a reason behind YouTube and Twitter obsession. But what everyone will find interesting is the science…the “why” behind the addiction users have to these sites. And it is an addiction. Don’t just post stuff. Find out what kind, what time, how often and what else you need to make your site a habit. Radio can use this science to its advantage also. Listen to Behavior by Design.
http://www.nirandfar.com/2012/05/first-video-of-my-behavior-by-design-talk-creating-addictive-products.html
The essence of why social media exists in the first place is…explained largely by science.
I have always said that unless we know “the why” the rest is just data of diminishing value. I discovered these studies last night. They focus on the neuroscience that will help us understand “the why” behind Facebook and other social networks where we enjoy seeking and liking.
To over simplify this research, it comes down to “the need for emotional gratification”. To quote one study – “Using products or services for emotional gratification is nothing new; some of the most valued things on earth are those that have the ability to transport us quickly from pain to pleasure. For example, we laud the ability of painters or musicians to move us with their art. Facebook, and the companies like it, are the new tools we use to quickly elevate our moods”.
Your Brain on Facebook…”We’re giving people something that deeply excites the brain in highly condensed form, which keeps them coming back. After all, the brain is built to minimize danger, and maximize rewards”.
http://blogs.hbr.org/cs/2012/05/your_brain_on_facebook.html?awid=4944464826693272441-3271
Spotting the Next Facebook: Why Emotions are Big Business…”The power of this universal human need for social acceptance and connection helps explain how the company grew well beyond college campuses and now touches one in eight people on the planet”.
http://www.nirandfar.com/2012/05/spotting-the-next-facebook-why-emotions-are-big-business.html
Social media are like candy for the brain…”researchers found that the act of disclosing information about oneself activates the same sensation of pleasure in the brain that we get from eating food, getting money or having sex. It’s all a matter of degrees of course”
These are amazing revelations broadcasters can use in the decision process as to what content is relevant in connecting to listeners. Facebook, Twitter, Pinterest, YouTube whether intentional or accidental all have these triggers in common. Radio has always had this ability to “elevate moods” with music but listeners want more now. Will we give it to them on their terms?
I’ve concluded that people leave relationships of any kind due to “lack of relevance”. At some point because you weren’t sensitive to or in touch with the current or changing needs of the target customer you become irrelevant to their path in life so the relationship changes for the worse and then dies.
There is such clarity in this quick Bloomberg interview with Ashton Kutcher. He really gets the state of media as it is at this moment. At the 1 minute market he talks about fragmentation. At the 2 minute mark he talks about the need for cannibalization. (Apple is a cannibal!) Anyone who owns a media channel of any kind should listen to the points he’s making. This is who you’re competing against for relevance in the lives of you customer.
Dear Radio…
The question that has been on every tongue at any and all gatherings of broadcasters: “Is Pandora radio?” The question I ask myself is “Why does radio care what Pandora calls itself?”
One of the things I learned early on in my tenure at The Research Group and then spent many years teaching others was the concept of strategic warfare…more specifically the rules of defense. How do you defend when under attack? One of the keys is to “know the difference between useful and useless attacks and allow useless attacks.”
According to Jacobs Techsurvey 8 – even Pandora users are split but leaning “NO” as to whether the Internet pure play should be considered “radio” – 43% “yes” – 49% “no.” Radio let Pandora miss-brand themselves.
Also according to Techsurvey 8, of the main reasons why they’re AM/FM listeners, favorite songs and DJs are on top of the list. Pandora lets algorithms pick the music and they have no talent. They are not human, yet that’s what listeners want in their local radio station. Radio, let Pandora be a science project.
It’s time for self-examination. The very first rule of defensive marketing warfare is defending what’s important to the base target user. For radio, that would mean re-investing in talent and listener research because this is no time for guessing what consumers want. The key is about radio remembering what radio is - what radio does best - and that’s to serve listeners. In order to do that, we need to know them on a more personal level than ever before. Radio seems to have lost focus on its purpose. It often appears to be focused on maximizing shareholder value, selling things and getting ratings. Radio’s real purpose is to inform, entertain and provide solutions for listeners. Shareholder value maximizes, things sell, and ratings happen as a byproduct of listener obsession and satisfaction.
You have important, relevant emotional characteristics that Pandora does not. The biggest advantage is that listeners trust you. So, the important question to be asked is, “Is radio losing that trust? Trust is earned every day. Radio is not sharing with or touching listeners like it once did. How can we be a constant companion when there is no one on the air, no one replying to emails, or even answering the phone? Back announcing is not sharing. The less we share relevant information or make them laugh, the less emotional connection there is. When we lose relevance, we lose emotion, we lose trust and we become more Pandora-like and the relationship withers. In the words of Gary Vaynerchuk, “If you’re not entertaining or have expertise you’ve got no shot”. This is also how radio will lose the dashboard.
Warren Buffett just invested $142M cash in a newspaper company serving 63 markets in the South! I thought newspaper was dead? Buffett said “In towns and cities where there is a strong sense of community, there is not more important institution that local paper”. No one is saying these kinds of things about radio. This is exactly what people should be saying about radio.
Your future success will depend on how many people decide to interact with you. Listeners will continue to engage with you if the content/reasons are relevant and personal (what’s in it for them?). What are you doing every day to provide solutions to problems and improve people’s lives? When you have real answers to these questions only then will the platform to connect on matter. This is how to stay relevant in cars.
Are you going to be neutralized by the Internet or use it in combination with your well earned advantages? Bottom-line for radio: stop worrying about Pandora. If you need to look over your shoulder then keep your eye on Facebook, Amazon and Apple. They are changing your listeners’ worlds.
The question that has been on every tongue at any and all gatherings of broadcasters, “is Pandora radio?” The most recent answer based on research not opinion is both yes and mostly no. According to Jacobs Tech Survey 8 – even Pandora users are split as to whether the Internet pure play should be considered “radio” – 43% “yes” – 49% “no.” Pandora boasts it’s a new kind of radio. (What does that even mean?) It’s my opinion the question is irrelevant. The questions I ask myself are “why does Pandora want to be radio” and why doesn’t Pandora want to be Pandora?
Chris Spiek of the Re-Wired Group said in a Forbes article recently – Branding experts and customers agree that the world doesn’t need another “me too” car, music site or energy drink. Imitation may be flattering but it isn’t inspiring.” To quote Mike McCue Flipboard Co-founder, “I’d rather compete with 1,000 copycats than 1,000 innovators”. Stanford Professor Steve Blank talks about the four paths of startups. Pandora, please watch and see if you recognize your path.
Did I miss the research data that said radio listeners are clamoring for “a new kind of radio”? Seth Godin is famous for telling business to invent a new category so you can own it. Create your own path. Apple is the best example of this but the Internet has many more. So why would Pandora want to compete in a category that’s full? Not to mention a category that many think is irrelevant or at least less relevant every day with all the new digital choices people have now.
It’s my belief to succeed you obsess over your customers and not divert your focus to the competition. Its clear Pandora branding doesn’t match the Pandora user perceptions. Pandora your users have defined you and I’ve not heard one person say “Pandora is a new kind of radio”. You are what many wish radio should be. The good news is again according to Tech Survey 8 - nearly half of those who listen to Pandora believe your music is better than the stuff they hear on commercial radio. From a business POV you have a very unique and engaging sales story and it’s not commodity ad sales. You can hyper-target active listeners in specific zip codes and zero in the local business message with documentable ROI which traditional radio has not found a way to do. You have so many unique qualities and benefits in product, service and sales that are so…Pandora. Imagine Pandora-like experiences or partnerships with Pandora-esque products and services (think Fab.com - Thrillist.com) where you charge a premium.
Pandora, be proud of what you are…celebrate your uniqueness, your individuality. You own a category and you don’t seem to realize it. You have risen to the rarified air of a one name brand. No explanation necessary. When people say Pandora…it’s understood. I have my own Pandora incubator, my 18 year old son. To him Pandora is about music discovery. Now that’s a personally relevant benefit. That’s “what’s in it for him”. Whether its classics or new music…what’s new music to him he finds on Pandora.
Pandora, you are succeeding because you are different than radio in ways that are very relevant to those who love you as Pandora NOT because you are a new kind of radio. Stop telling people what you want to be and hear your users when they tell you what you are to them. Facebook never said they were better than MySpace…they just were in personally relevant ways. So be the best Pandora you can be…not a better than radio Pandora. Remember in the movie Social Network when Sean Parker told Zuckerberg to “drop the the…just Facebook”? Link - http://www.youtube.com/watch?v=PEgk2v6KntY
Drop the radio…just Pandora.
