Today’s post is a rarity – a fraternal effort by the Jacobs brothers. Paul clued me into his Pandora news and then Bill walked in with a Pandora story of his own. I think it makes for a timely post. See what you think. – FJ
Some media observers and pundits are of the mind that pure-plays are the progressive innovators. But in fact, much of what a brand like Pandora has done is ape the radio industry it is trying to supplant.
Aside from the Pandora Radio handle, this week saw two new developments from the company that ought to send a direct message – or another shot across the bow – to broadcast radio in markets big and small.
First, Pandora is doubling its sales efforts in local markets. Looking to hire as many as 50 sales reps in 2014, Pandora is now moving into markets like Cleveland, St. Louis, Houston, and Denver. Their goal is to reportedly have sales reps in the top 50 markets.
And with a force of 250 people, Pandora is growing its sales department at a time when the cubicles get emptier by the month at commercial radio stations.
To exacerbate the situation, reports indicate that many of these Pandora sellers were formerly running around with rankers and rate cards from broadcast operations. According to Pandora Regional VP Gabe Tartaglia in a NetNewsCheck article, their reps have an advantage by being able to put together deals that are regional, covering several markets.
In contrast, commercial radio has suffered through a decade (or more) of beat downs, commission rate changes, less compelling content, minimal brand marketing, and other frustrations. As a consequence, many broadcast sellers are thinking the grass is indeed greener at Pandora.
And as noted, at a time when Pandora is sales staffing up, many radio stations are moving in the opposite direction. Whether it’s to save money, the lack of competent sales personnel, or other reasons, the fact these two radio entities are philosophically moving in opposite directions is a question that will undoubtedly be a topic at RAB conferences and board meetings to come. But there’s no question that Pandora perceives value in traditional radio reps – an interesting dichotomy to be sure.
And then there’s the matter of Pandora’s newest mobile innovation – the in-app alarm clock – announced earlier this week for iPhones. Our jacAPPS mobile applications were the first to include the ability to wake up to your favorite morning show via the stream back in late ’08.
Our Techsurveys have long identified that those nightstand AM/FM clock radios are rapidly becoming extinct, replaced by the ring tones of your mobile phone. And that’s how we figured out that apps could perform this same function, waking you up to your stream. Pandora’s research has undoubtedly revealed the same thing.
We clearly live in a “what have you done for me lately” world, and this simple new Pandora app feature is more proof of that. An app alarm clock may seem ho-hum on the surface, but it represents another serious incursion into the space that used to belong to broadcast radio. In much the same way that the car dashboard is changing, Pandora is attacking broadcast radio one platform and one innovation at a time.
It is yet another reminder that if your station apps are not robust, entertaining, and loaded with a great user experience, it’s not good enough. And if it’s just a way to stream your station, it’s not even close to being good enough.
But the bigger picture is that Pandora is copying broadcast radio’s greatest strengths. Let’s get past flattery or denial, and start innovating again – whether it’s in the sales cubicles or on that mobile device you’re reading this blog on.
It’s still the second inning.
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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Wow, what timing. As I no longer program radio and am on the other side and buying it now, probably as this was being written I was having lunch with a Pandora seller. One of MANY that now troll the local landscape. My Pandora AE happened to be a person that used to be one of the best, most creative and hardest working reps in local radio. Said person opted out of a declining income and support structure to take on a whole new life with completely different metrics. In your face moves, branded as “radio” and tech moves that are on par with a growing receptive audience is moving them forward and they not slowing down. Is this the death of “local radio”? Not for me to say. But Shakespeare’s “Tempest” comes to mind. “Death by a thousand cuts”. Great blog today.
Thanks for the real-life update, Scott. Clearly, the radio sales front is becoming a battlefield and broadcasters have to face that. Appreciate it.
Not to mention that Cumulus lost a Corp VP of Sales to iTunes Radio this week also.
This is just the first wave. Programmers and Air Talent will be also have opportunities with Pure Plays.
Let’s celebrate this. This is GOOD! It means “Radio” is expanding.
It’s not “death” by a thousand cuts – it’s evolution.
AM/FM/HD/SatR/IP. These are just the means by which content will get from producer to user.
As a content producer – can you really afford to mirror the AM/FM Transmitter owners partisanship about what IS and ISN’T Radio?
It all depends on your point of view and to what degree you’re a stakeholder. As a content creator, you may have a field day as you seek out the best client/platform/space in which you can produce. But if you’re a radio owner or operators, it’s affirmation of a more complex, highly competitive environment. Thanks for the opinion, as always, Jeff.
You hit the nail right on the head. Pandora is skimming off the best parts of radio (in their mind) and leaving the scraps like remotes and ineffective giveaways to the terrestrial broadcasters. They’re still losing money, but they may (and I say MAY) be on the way to figuring out how to skim off the cream and leave everything else behind.
Of course, so is Spotify with their new free ad-supported mobile product, which isn’t bad at all, and all the other pure plays with their ideas on how to go after Pandora and regular radio stations. And there’s the potential for iTunes Radio to become a player, but it isn’t very impressive to me.
And FYI, Pandora has had reps, former radio reps, on the street in St. Louis for over 6 months and their sales manager is a former big group DOS from Kansas City. I don’t know how well they’re doing as I pay for Pandora One and don’t hear spots, but I know they’re all good sellers and they’re all working hard to get local money on Pandora.
Thanks for that, Mark. The results may not be clear yet, but the intent is. Appreciate you taking the time to observe and comment.
Pandora isn’t copying radio’s greatest strengths, it’s co-opted radio’s greatest former strengths. The lack or research and manpower has taken radio out of the music curation business – its all mailed in now…and radio pushed its best, most creative and effective sellers out with non-competes, lower pay, goal post moving and “the beatings will continue til morale improves”early and late sales meetings.
Pandora has simply jumped on the bandwagon radio abandoned (and is still somewhat living off the memory of) and riding it as far as they can. Its a pity radio has made it that easy for them.
But I digress – lets get back to what’s really important: Is Pandora radio?
Bob, I think “co-opt” says it better than “copy.” I think you’ve got it right, and there’s no reason why radio shouldn’t re-examine what it has walked away from. Thanks for the timely kick in the butt.
As usual you guys hit the nail on the head as to the state of the radio industry. Scott Miller also echos my thoughts. There is very little that compels you to listen to local radio. I made my living off of advertising. Times have changed. I have tried to listen to Mitch Albom but c’mon. Sign on at 5:10 pm, commercials from 5:12 to 5:22 then traffic then more commercials? WTF. I’ve been a “peddler” my entire life, I’m 71, regardless of the positions I held in local radio. I need to have a certain degree of passion to use my art of persuation. Nothing to be passionate about in today’s local radio. I entered the radio business because I loved music and learned what having t passion for a station meant. Couldn’t’t see that happening today. This is not an old guy rambling, still involved in music and this was a great plat form to do it. Happy Holiday Jacobs Media, my “go to” radio consultants. Hey, did I ever pay you guys? Don’t send a bill now. LOL
Times have changed, Al, and the “typical radio” experience is being redefined right before our very ears. The “P word” has always been what it’s about but it is just not as prevalent as it was. Thanks for the perspective, happy holidays, and no, I think we’re at break even!