When it comes to traditional media’s travails, the newspaper industry has always provided great object lessons for radio. The downfall of the local newspaper provides compelling cautionary tales for hometown radio stations – specifically, what not to do to keep customers happy and engaged.
But in recent years, the poster boy for bad service and a lousy customer interface goes to cable television. We’ve discussed cord-cutting before – a new question in all our Techsurveys. In the biggest of those web research studies – Techsurvey 13 – we found that more than one in ten (12%) North Americans say they’ve cancelled pay TV.
And the kicker is that Millennials lead the way. As an industry, you don’t want to run counter to a generation that now outnumbers Baby Boomers.
That survey was conducted in January/February. Now, a new story in Variety indicates that for the cable TV industry, cord-cutting has become an even bigger Albatross for the cable business.
eMarketer’s research predicts that more than 22 million will have ended their relationship with pay TV by the end of this year. And as our data clearly shows, eMarketer’s says the quickest to abandon shelling out money for cable TV are young people, the bread and butter of the media world.
And a group that is rarely reported – “cord-nevers” – people who have never paid for TV is growing, too. In our survey, that’s 5% of our sample. eMarketer predicts that in four years, those who have never ponied up for pay TV will equal the number of cord-cutters, exacerbating that industry’s tough predicament.
So, what can radio learn from what’s happening next door in the cable TV business.
1. Provide a strong UX
If you’ve ever had cable (and most of us have), chances are good the overall experience left a great deal to be desired. This industry has been notorious for rotten customer service, blown appointments, insanely long waits, confusing plans and bills – all culminating in low satisfaction scores.
Our Techsurveys have consistently featured Net Promoter Scores – measures of word of mouth recommendations for participating stations. If you’ve never included this question in perceptual studies, I’d highly recommend tracking it – and paying attention to it.
2. Stay connected to your customer base
The cable industry has been especially reticent to interfacing with their customers one-on-one, preferring recorded answering systems that are slow, confusing, and frequently frustrating. Personally talking with customers and staying connected to them is essential for any service business, but cable has squandered its relationship with its pay base.
Radio has had its own issues with customer interaction. While stations may be accessible at events, radio’s track record on the phone and even in social media acknowledgment has been spotty at best. Most radio stations have amassed email databases, and many of those who signed up are P1s. Outreach campaigns that focus on loyal fans are smart, strategic ways to stay tuned in to those who already enjoy the station, its personalities, and its promotions.
Consumers (listeners) want to be heard and heeded. Ignore them at your own peril.
3. Don’t take your loyal audience for granted
The only thing worse that being a cable TV subscriber is being a long-time cable TV subscriber. Service and perks don’t get better over time And in fact, price increases are typically how loyal customers are rewarded for their business, rather than preferred treatment. There’s no “gold line’ for those who have been shelling out thousands on pay TV for years.
That’s part of why cable TV companies are often perceived as greedy and tone deaf to their most loyal customers. In the case of radio, it’s the commercial load that provides equivalency to cable TV’s problems – in an environment where better listening experiences are available from streaming and satellite providers.
4. Pay attention to Millennials
Our company has been especially tuned into what young people are thinking and doing when it comes to their media usage and preferences. This year’s “Millennial Research Project,” conducted in conjunction with PRPD and a group of 15 stakeholder stations has been especially revelatory.
Radio’s track record with Millennials – and their younger brothers and sisters – has been checkered. The industry’s fixation on 25-54 year-old demographic makes it systemically easy to ignore teens and college-aged consumers.
But they’re the ones stirring the drink, based on their sheer size and influence. Clearly, the cable TV industry hasn’t addressed Millennial concerns in a meaningful way, as evidenced by their rush to the exits. “Cord-nevers” are especially likely to fall into this age group, the equivalent of not having a radio at home.
5. Make your product available wherever consumers are
The cable industry has traditionally been about providing content in rec rooms, kitchens, and dens – mostly the home front. These days, it’s essential to provide great service on mobile devices and wherever the audience wants to enjoy entertainment and news.
For radio, it’s a given that content now has to transcend traditional broadcast radio settings. That means mobile devices, the car dashboard, and smart speakers like the Amazon Echo. The longer radio operators delay providing their content on myriad digital devices, the easier it is for consumers to lose interest and gravitate away.
6. Invest in on-demand programming
Cable TV has been undermined by its own content providers – major networks and subscription services that have systematically made their programming available on-demand. Disney, CBS, HBO, and many others make it simple for consumers to cobble together their own custom content networks, without committing to 300 channels they’ll never watch.
In radio’s case, the march to podcasting is a sure sign that on-demand programming access isn’t just an interesting option – it is rapidly becoming an important avenue for enjoying audio content. Yet, many radio companies still view it as an interesting option. Our time spent with podcasters big and small at the Podcast Movement conferences these past few years – couple with our Techsurvey data – strongly suggest podcasting should be an important endeavor worthy of time, strategy, and investment.
Cable TV’s rough ride isn’t likely to get better, even with the advent of “skinny bundles,” special holiday deals, and other band-aids and come-ons. When consumers decide to stop supporting a platform, turning around those negative perceptions becomes a heavy lift. The pay TV industry hasn’t figured out that the easiest consumers to service and satisfy are current customers, rather than the Herculean task of attracting brand new subscribers.
For radio, the game is the same. When so many continue to tune in AM/FM stations each week, the time to focus on keeping them happy is right now.
How can radio make that 93% smile?
Jacobs Media has consistently walked the walk in the digital space, providing insights and guidance through its well-read national Techsurveys.
In 2008, jacapps was launched - a mobile apps company that has designed and built more than 1,300 apps for both the Apple and Android platforms. In 2013, the DASH Conference was created - a mashup of radio and automotive, designed to foster better understanding of the "connected car" and its impact.
Along with providing the creative and intellectual direction for the company, Fred consults many of Jacobs Media's commercial and public radio clients, in addition to media brands looking to thrive in the rapidly changing tech environment.
Fred was inducted into the Radio Hall of Fame in 2018.
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I’m going to do something here that I normally don’t do – defend radio. Yes, the cable industry is a case study in how to drive customers away – they though they had a captive market and technology changed that. Its interesting that they also control Internet access – the conduit to cord cutting and that their response has been to impose data caps and lobby for what amounts to limiting access to the most popular Internet services, rather than woo customers back with better products and service.
The music industry was another hated sector that consumers were happy to cut out when Napster happened and again, they chose to sue their customers rather than make them happy. If high speed rail were to become a reality people would flee the airlines in droves and the list goes on.
Radio doesn’t have that kind of reputation. People mostly still love it and even the ones who are listening less don’t hate it like people hate their cable company, they’re just reacting to and using products they like better. Although the product has been dumbed down over the years, probably most people haven’t noticed. Radio’s biggest mistake seems to have been not owning things like/streaming, podcasting/curated playlists before someone else did.
People are loath to give their cable company another dime. Not so for radio IMO. IT’s probably not too late for radio to leverage its brand equity into other products, but the clock is ticking. The streaming ship has probably sailed, but the podcasting one hasn’t. Radio’s brand could help launch and sustain related products – its not the cable company!!
Bob, good points (and nice to see you defending radio for a change 🙂 ). You raise a key point – radio leveraging its loyalty and reach to expand its horizons and make digital a natural outgrowth of the main product. But the experience – the UX – is still key to thriving, as well as customer service. No, radio will never get as bad as cable companies, but it’s especially important in local markets that radio keep those home fires burning. Thanks for the comment.