What’s the best way to communicate a warning?
Is it numbers on a spreadsheet? Is it hearing it from a trusted friend or confidante? Is it a research study? Or is it a memo from your corporate bosses?
Or is it a message in a fortune cookie?
Whatever it takes, the radio industry would be wise to take note of the changing reality about where auto dollars are being allocated because it’s moving fast.
Late last week, Emmis released its fiscal Q2 report card. Admittedly, it was a tough August for the company (and for radio?), but the data point that jumped off the page was focused on automotive revenue. Like most broadcasting companies, car money is Emmis’ top category but was off 7% year over year.
While Emmis reported brighter results in other categories, the automotive challenges are only getting more difficult to navigate. This is a major topic for Jacobs clients, and something we’re discussing with broadcasters on a regular basis.
Just a few years ago, the radio industry was waking up to the reality that dashboards might not be as friendly to AM/FM radio operators as they were back in the days when it was two knobs and six presets. Radios were simple and ubiquitous in every car and truck that rolled off the assembly line.
Complex in-dash audio systems, now with the addition of interfaces by Apple (Car Play) and Google (Android Auto), have made this a topic at virtually every radio broadcasting conference during the past few years. How will consumers find and access AM/FM stations in new vehicles? And will the content that broadcasters create be able to compete against music libraries, apps, and streaming music services?
But the sales side of the equation may be even more critical to radio broadcasting’s long-term health. Auto industry ad spend – at both the OEM and local car dealership level – is changing FAST. And many radio sales teams are being caught off guard by these shifting priorities.
Right now, Paul is working with a medium market radio sales team, helping them better understand what car dealers are thinking and why this matters dearly to radio. As that station’s sales manager reported back to us after interviewing a local dealer president, “They have gone from spending $70,000 a month on ‘traditional ad dollars’ to $20,000 a month and don’t feel they are missing much. They also struggle with the message on TV and radio as they feel it is the same thing over and over and every dealer has a $199/month deal.”
You can see how this plays out in this video we produced featuring two Detroit-area dealership heads, each of whom reinforces the need for greater advertising accountability from all their media outlets:
If you don’t think these guys are representative of dealership owners and presidents, take a day and talk to some of their counterparts in your local market. More importantly, listen to them. Like our client sales manager, you may hear things that are disturbing. But chances are you’ll also start thinking about ways that your stations can be proactive and innovative, helping these dealers achieve their goals.
Hopefully, that’s where the creativity on the local level comes in, because without it, what we’re seeing in these quarterly calls will be a slow leak as radio’s auto dollars diminish over time.
It’s why a significant portion of our DASH Conference agenda is devoted to the automotive revenue challenge – not just teaching consumers how to tune in radio stations on the new dashboards – but the quest to save and grow revenue..
We have devoted several sessions to this issue including:
- Ford Direct’s Director of Connected Car Innovations, Dave DiMeo, is in charge of allocating their company’s dealer co-op dollars, so attendees need to understand his thought process. And Dave will talk about what radio can do better in order to re-earn this key portion of auto ad spend.
- Erica Farber will be interviewing a group of local car dealers like the guys in this video, and go right to the heart of the challenge and what radio must do in order to prevail. We’re assembling a great panel, and you will want to pay attention to what they’re saying.
- Ford’s VP/U.S. Marketing Sales & Service, Mark LaNeve, will speak out on the changing advertising and marketing priorities of his company. And here’s an extra: he’s on the board of Entercom, so Mark is a prominent auto executive who understands the radio business.
- Select Marketing Group’s Mike Hillstrom will talk about how the use of “influencers” (yes, your prominent air personalities) can be the difference-maker in how you use your station as a marketing vehicle to dealers.
- The President of Liquidus, Chris Carlton, will speak directly to how broadcasters can crack the coke and generate digital revenue from local car dealerships.
- Pandora VP/Automotive Business Development, Geoff Snyder, will be joined by General Motors’ Global Connected Consumer Fields Sales & Operations Leader, Kevin Squibb, to talk about the importance of dealership visibility and how it is changing for media brands.
It is fascinating to me as a programming guy to see how this conference now addresses some of the key sales and revenue issues facing the radio broadcasting industry. Of course, there are numerous sessions that speak to the content side of the “center stack,” and what brands like NPR, Slacker, Podcast One, and Midroll are doing to create programming that matters to drivers. But this sales piece is rapidly becoming mission critical for radio, and DASH is the only conference that addresses it from all angles.
You can see the entire agenda here, including this year’s keynoter, iHeartMedia’s Bob Pittman.
And while I would never advise that you hinge your strategy on a tiny message curled into a fortune cookie, I have a strong feeling that radio needs to work harder and smarter to change this outcome. It starts with understanding the problem, developing action steps, and putting them in motion.
See you at DASH.
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.
- Radio + Thanksgiving = Gratitude - November 27, 2024
- Is It Quittin’ Time For SiriusXM? - November 26, 2024
- Radio, It Oughta Be A Crime - November 25, 2024
Leave a Reply