Most radio companies are going through flattish times, but that is not the case for the automotive industry – radio’s top revenue category. Yes, most car companies are having record years as the recovery from the Great Recession continues.
And the “connected car” revolution is projected to continue at high rates of speed. eWeek is reporting that Gartner predicts there will be 250 million of these vehicles on the road in just five years. How’s that for a tipping point? And along the way, Infonetics Research reports that “connected car” service providers will rake in $17 billion (with a B) in 2018 as a result of the automakers’ obsession with this technology.
But the money and the activity isn’t just happening on the corporate level. The folks who sell and maintain those vehicles – car dealers – are generally experiencing good times, too.
At the National Auto Dealers Association Convention in San Francisco a couple of days ago, the biggest complaints revolved around not having enough inventory to sell. In a San Francisco Examiner article about the convention, NADA’s VP of public affairs, Jonathan Collegio, pointed out that “the automotive retail industry is back, and it is roaring.”
And that brings us to the car dealerships in your town, whether you’re in Chicago, Chattanooga, or Chico. Understanding the fundamental changes at this grassroots level is a key for radio station programming, sales, and marketing departments.
That’s been a theme at our DASH conference the past two years. Our car dealer panels have been among the most highly rated because broadcasters are learning they need to acquire a higher level of understanding about the changes at the car store right down the street.
Dealers are more sophisticated about advertising and marketing. And when it comes to the “connected car,” they are the true touch point between the customer and her relationship with her new car. These new dashboards require training, and sometimes retraining, and car dealers have had to staff up in order to meet the increasing demand.
When you have trouble pairing up your phone in your Fusion equipped with MyFord Touch, or you forgot how to use the navigation in your Jeep equipped with Chrysler UConnect, you don’t contact the manufacturer – you drive to the dealership that sold you the vehicle for assistance.
That makes the inflection point between consumers and their cars so critically important to radio. Because as yesterday’s post pointed out, radios are present in every new car coming off the assembly line in 2015. The challenge for many consumers is how to find and program them.
At DASH late last year, Paul Jacobs captured some of these “connected car” training moments on video at a dealership here in Michigan. As you’ll see in the video below, these trainers are bright and well-informed. But consumers are often more jazzed about satellite radio, Pandora, and pairing their phones than they are setting your station on their new digital dashboard.
Yet, as Paul found out during his interviews with trainers and dealership executives, these walk-throughs with new car owners can emphasize just about any aspect of the in-car infotainment experience. For radio, that’s of paramount importance.
>Email Recipients: Click here to watch the DASH 2014 Car Dealer video<
But it all starts with how broadcasters approach the space. And as we’ve learned from giving countless “connected car” presentations at shows as big as The NAB/RAB Radio Show, Radio Days, Canadian Music Week, and the Worldwide Radio Summit, most radio people have truly not experienced these vehicles.
So car sales are skyrocketing, “connected cars” are rolling off assembly lines, and yet as counter-intuitive as it may sound, many radio people are still thinking in terms of two knobs, 12 presets, and a CD player.
That’s why it was refreshing to hear from two-time DASH attendee Dave Paulus, market manager for Max Media’s Hampton Roads (VA) cluster. Dave put together a field trip to a local car dealership so his core staff could experience the new reality of the “connected car,” as well as the changing driving experience.
Dave tells the story this way: “After leaving the DASH conference last October, I thought of two areas of concern within my own building. One, my announcers never drive a normal commute.”
Of course, this is because everyone’s hours are staggered around their shows, most of which don’t align with typical driving patterns.
And the second area of concern? “The majority of my airstaff had never been in a ‘connected car.’”
So here was Dave’s solution:
“Starting in second quarter, my entire on-air staff gets a free day off on me. The only stipulation is that they have to take 90 minutes and drive the highways, tunnels, bridges and tolls of the Hampton Roads area during PEAK RUSH HOUR.
They need to make notes (not while driving!) about what the traffic was like, what the surrounding cars were doing during the commute, what they found challenging, etc. I want them to experience their world like a ‘soccer mom’ does as she’s getting her kids to school and heading to work, not like an announcer does in a pristine studio every day.
Then, I reached out to our friends at Hall Automotive and set up a couple of sessions at their Nissan dealership to do a full training session on the ‘connected car.’ Our amazing trainer, Nikki Midkiff, took us all through every facet of these vehicles.”
And the result?
“You should have seen the faces of the announcers when the ‘display’ pulled up the latest gas prices from the station on the corner. I asked her what are the two most consistent questions asked and she said it’s ‘How do I hook up my phone?’ and ‘How do I get my radio stations and Pandora through the display?’
Lessons learned. The competition isn’t just about the country station down the dial or the other two CHRs. The real competition is everything that takes away from a chance to engage with our audience. Phones, kids yelling in the backseat, glare on the windshield. EVERYTHING! Every break has to be prepared, planned and entertaining or their world is just a click away.”
There’s nothing like a test drive, along with living in the shoes (sandals, Nikes) of your audience, as their in-car audio experience undergoes change.
The car is the primary inflection point for radio, both from a listening and revenue point of view. And we continue to learn at events like CES, as well as our own DASH Conference, the car dealership has become the epicenter of these changes. And we’re not talking in 2020. It’s about today.
As the radio broadcasting industry grapples with change wrought from the digital revolution, there is no more important issue than the “connected car.”
Of course, we will continue to update you here on this blog. And we have developed actionable presentations that we are taking on the road in 2015 to bring these issues to broadcast radio.
In the meantime, buy, lease, rent, or test drive a “connected car.” And in the process, rethink those dealership relationships.
And keep both hands on the wheel – it’s going to be an interesting ride.
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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Two quick takeaways
1) Kudos to Dave – every radio exec with a V or C in front or their title should take this dealership tour
2) Is there a product placement opportunity for radio? A national deal where radio (or a big radio company) paid GM, Ford, Toyota, etc. to make setting/quickest access to buyer’s favorite radio stations a part of every post purchase “how to” session. Pandora is losing money – I don’t think they could pony up to outbid radio on it.
Thanks for the kind words, Bob. We actually spoke about that very topic during one of our sessions there.It’s a really interesting topic
Bob, yes and yes. Your second point was a key DASH topic, and one that we are continuing to move forward on the state broadcaster association circuit. It is truly a better, more reachable path than radio trying to partner with every OEM, and it’s a nice local/local play. Thanks for chiming in.
Speaking of OEMs – isn’t it likely that before too long Apple and Google (Android) will own/supply the Center Stack OS?
It is clearly looking like both of their platforms are going to end up in a lot of vehicles before long. At CES, we were clearly taken by how many vehicles had both.
3 things
1. I am fortunate I don’t compete with Mr. Paulus in my market. Huge props for his acknowledgement of the change required in our industry and exposing his staff to the real life lessons required with these changes.
2. Huge props to Mr. Jacobs for pointing out how automotive dealers are more sophisticated marketers than most radio sales people give them credit for.
3. As stated, by Mr. Jacobs, automotive being the top revenue category, radio broadcasters “MUST” understand and embrace the changes with ideas, creative and informative content . If we do not do this now, other advertising mediums will step in and help the automotive industry show off these features. Features that most radio people still think are from some futuristic movie they watched in 1990. It is here NOW and our listeners need to hear that from us in the radio business NOW.
John, thanks for the kind and forceful words. While radio is being challenged on a number of fronts, there is no great issue than what is happening on the automotive front. We will continue to deliver that message in this blog, and on the speaking circuit as well in 2015. We are gratified that some of the lessons of our DASH Conferences are manifesting themselves in creative ways like this. Much appreciated.
Certainly agree John and thanks for the kind words. getting our announcing team to understand WHY we drive content, execution and engaging radio for EVERY BREAK so strongly and not just making it a order, was a huge offshoot of this.
Rock on my friend.
What an awesome exercise/learning/thing to do isn’t it? Another good read gentlemen. While at KISS/San Antonio, we got a day off once a quarter to do this.
Tim “Slats”
WNCX/Cleveland
It’s just smart, Tim. Any time you can give the airstaff a window in the lifestyle of the audience – especially when it comes to in-car listening – you’re doing them a service. Kudos to Dave & the Max Media stations.
Thanks Tim and Fred for the nice words. As usual with this stuff, it’s just finding the darn time to do it 🙂 But it’s so important.
FJ,
THIS is perfect timing! Just this past Monday, I over heard a few (non air talent) colleagues say “nobody listens to radio online”. Before throwing up my tea, I HAD to chime in about not only my ‘connect car’, but a ton of my female friends who have the same and can’t live without it. THEN pulled up my TuneIn App with a handful of my affiliates (in small & medium markets) whose numbers are in the hundreds of thousands, if not, a few million.
Many of my listeners have told me they love the fact that they can now listen to their “hometown stations” through their bluetooth, connect-car, etc., away from home. And on a personal level….even though I miss the fact I’m not on the air where I live locally, I am able to crank my ‘Best of’ show every Saturday driving around Denver.
Once again, thanks!….I’m off to send this read to a ‘few colleagues’.
lu valentino
Lu, thanks for these insights. It’s important for all content creators to make it all available wherever listeners are – in cars, on laptops, phones, and tablets. The over the air broadcast may be simpler and more elegant, but to stay relevant, you have to be where the audience is moving. Thanks again!