Research or Ratings SAMPLE is EVERYTHING!!

Recently we've seen lots of discussion over samples in ratings. Much of it relates to Arbitron rolling out the PPM and we've seen some industry concern over the sample both in size, return and balance for ethnics and demos. No doubt we'll see more confusion on the sample with PPM rolling out because PPM is really a different type of research than we have traditionally used for ratings. With the diary we are looking at a snapshot of one weeks listening as recalled in a diary vs the behavior of the respondent over weeks and weeks with no 'recall' necessary. If you go to our reports in McVaymedia.com you can get a lot more information and analysis on the differences between PPM and Diary methods here.

Before you work with any research or ratings data the most important analysis tip we can pass on is LOOK AT THE SAMPLE. How far off of the population estimates is the return? You may also want to look at how the sample returned in zip codes or key ethnic areas. Know who they got of hold of. Of course Arbitron does reveal the numbers, it may be a little harder to find on the Max or Arbitrends menus but it's there and you should look at it before you celebrate or wonder what happened. The same goes for any perceptual or music testing you do.

In order to get realistic results Arbitron and many other studies balance the sample by weighting. This places more value on demos or areas where they have lower or higher returns than in the population estimates. It does affect the reliability of the results and the confidence levels. While it might not be a tool that sales wants to dive into trying to sell with the numbers, programmers need to make sure the sample is reliable before you make 'big' conclusions based on it. It's also more of an issue in the smaller markets where often see a lot of weighting with a small sample and some pretty big wobbles in the numbers. Are you feeling real good about gains that were more the result of a few diaries weighted way up that will disappear in the next report? Or are you looking at a downturn that's really an illusion? No research is perfect you have to look deep into the results and the sample before you act.

14-24s Radio's Lost Generation - Under 14s Radio's New Frontier

Remember when you got that long awaited new toy back in your pre-teen days? That extra cool electronic device, maybe a guitar, an Atari game system or a fancy new bike that you just had to have. You shed other interests or gave up other desires for that magic 'thing' that you thought would be the ultimate. Then after you played with it for a week or maybe a few months or maybe even a year somehow the magic just wore off. It sat in the corner or maybe it broke and it just faded into the pile of junk we seem to gather in life. Suddenly something else came along that looked a lot more interesting or perhaps it didn't live up to all your expectations and you moved on.

As we look at all the new media toys like IPods, Internet radio stations like Slacker or Pandora, Satellite Radio, I Phones, the latest Cell phones, social networking, IM, text messaging, video sites and whatever is next on the web that challenges radio for entertainment you can bet that a lot of them could end up just being the new toys for the 14-24s or Millennial generation.

Remember that the Millennial generation (born from the early 80s to 2000) are the first generation that largely grew up in the personal computer age. When they hit elementary school in the mid-late 80s the Apple computer was already in nearly every classroom. Most in the U.S. saw a computer enter the home and have some Internet access in their teens and the younger ones have never lived in a home without a computer, over 50 cable channels, VCRs, DVDs, complex gaming systems, hand held games, cell phones and the web with high speed access at their finger tips. They have embraced all the new technology and shunned the old much like the boomers jumped on TV, instant world communication, and jet travel.

Radio's role with the Millennial generation was clearly diminished because Radio didn't pay much attention to this new emerging generation. Spending it's merger and Wall Street diminished programming resources on the older 25-54 generation deemed more instantly rewarding by the forces in command, radio began to fade. But, so did broadcast TV, the record industry, and land line telephones. The Millennial generation had NEW TOYS to play with and try out.

But, how long will the new toys last? Look at the cell phone in your hand. If it's more than 2 years old chances are it's starting to look like a relic. Even if you are a tech savvy person you probably never even figured out all it's toys or uses. Even my daughter's phone has lots of features that she rarely uses or doesn't want to bother with.

Remember all this new media technology is new. While logging on the Slacker Radio looks like an ultimate personalized web radio station programming it to play your favorite songs takes hours and hours of sorting through thousands of selections. Building and maintaining your IPod that holds thousands of songs is a daunting task ripping CDs into I Tunes and spending time every couple of weeks downloading new songs. Then you have to rate them, build playlists, and keep the database up to date so you can find that favorite within the thousands of titles. Building that cool Face Book or My Space site may be fun at first, but maintaining it and keeping up with all the friends, adding new pics, adding video clips and communicating with all these friends that may live on the other side of the country. It could be so complex and time consuming that sooner or later the new toy starts to sit in the corner.

You also have a new generation on the way that's younger than the Millennial generation. Right now they are under 10 years old. Will they be as excited about all this new media as the older generation above them? Or will they more likely establish their own turf starting 5 years from now as the first of them enters high school?

If radio starts thinking and planning now latching on to this new generation could be the 'turnaround wave.' Will they rebel against all the pitfalls of lives on the web and seek more personal and imaginative communication and entertainment options? Could radio's simplicity of use and low cost coupled with links to the new media world be an attraction to younger audiences again? As we look at some of the research done on the younger side and the early PPM results we see radio having an impact in the younger side.

It's a possibility but we'll need some help from the top levels in our industry, music, ratings services actually doing a representative job measuring the new generation, and a realization that this audience has marketing value from the agencies and sales forces. Arbitron is already moving to younger demo measurement in the PPM system moving below 12 year olds. We will likely have more stable samples as we move away from the 1 week diary measurement to longer term behavior data. We will also have new bands (if HD ever happens) and at least opportunities to provide stronger products in the Internet broadcasting field. Hopefully our hunger and need to reinvent ourselves will lead us to entertain and program to have an impact in this emerging generation.

Radio could be HIP again! But, we need to start planning now.

Local Community - What is it?

Anytime you talk within most radio stations about being local and getting involved with the 'community' instantly you get back a long list of fund raisers and marathons to raise awareness for some cause. You might also get a lot of local organizations station personnel have been involved in off the air. In some cases you also might have a story to tell about helping the community through a disaster.

Aside from the disaster help most of these examples of being involved in the local community are not a big headline with the audience. We all know getting involved in some big fund raiser where we are begging the audience to contribute never builds much audience, in face it's almost always a BIG tune out. The marathons are only longer BIG tune outs. The long winded remotes we do from the local art fairs or music festivals are rarely entertaining enough on the air to help build audience. The off air meetings and organizations are probably better at getting us introduced to other local business people and community leaders than it is helping us build audience.

Yet, most of our market advantage in the new world of new media will probably come from how well we become ingrained into our communities. You can see it clearly in so many successful stations that seem to have audience all the time. Look at WCCO, WGN, WLW, and so many of the big AM talk stations. WGN eats, breathes, and sleeps Chicago. You also see it in music stations like WDVE, KQRS, WMMR and WFBQ in the rock world.

While it may be important to try and cure diseases and help the less fortunate in the community to really win the community involvement hill you have to really embrace the REAL community. That means relating to and including the listeners and community into the fiber of the programming and making it entertaining. Here are some tips and examples:

• Know the Area - We often think of show prep as hitting a bunch of news/gossip sites for the top pop stories of the day and hunting for a few angles or jokes on them. Perhaps we should be prepping by taking a close look at the local maps, newspapers, landmarks, hangouts, and special culture. Knowing that Topside is the hip area where all the cool young clubs are and that Northside is the blue collar/sports bar area may be more important than where Paris slept last night. You might want to have 'experts' in various areas on the staff. Have them report to everyone where the people who live on the east side hang out. Exchanging info here can help the whole team know the area.




• Be Visible - You don't need to do remotes from every local festival or high school event but you should try to be there somehow. How many nights did your van just stay at the station? I bet more nights than it went out and it could have been at the high school football game, the arts fair, the opening of the civic players show, or just parked at the mall in a obvious place. Could you have put up some banners or even just helped them with some need and get mentions in their programs or signage. It takes coordination, some staffers, and probably some gas and all that adds up but being visible in the community is key to being perceived as a big part of the area.




• Remotes - While they can be a tune out source you can also make them good for exposure, entertaining on site, and if you are careful they won't be any more of an intrusion than most commercial breaks. The key is planning ahead and making sure you have something entertaining going on at the event.




• Phones - Getting the audience on the phone and taking the few seconds to introduce them in a friendly and quick way is a great way to tap into the community. The key is using the phones the RIGHT way. If all you're getting is the quick answer to some trivia question there's little local or community involved but if you take a few seconds to pre answer the calls in spots and get everyone's name and community then fire through the calls the whole bit changes.




• News - Sports: What's more important - A Rod hits homer 502 or your Little League team goes to the LL World Series? Unless you are in NYC I'd go with the Little League team. What's more important - Florida's drought or local county board bans fireworks? Unless you live in Florida the fireworks is more important. Keeping the news tuned in to what is really effecting the local world is crucial.




• On Air: Take the time to talk about the local events, community, places and people. Sometimes you can't do it in 10 seconds. But, if you plan it out and work to make it entertaining you can get the audience to hang with your for 20 or even 40 seconds. But, you will need to prep and the whole stations needs to jump into the community.

This is not about begging or fundraising - it's about realizing from top to bottom that THE STATION is a cornerstone of the community and needs to constantly integrate that foundation into the on-air product and the off air image. When it works it's a NEVER ENDING commitment and after years and years it becomes a huge deal breaker for audience loyalty.

When I was at WDVE (over 20 years ago) we keyed in on the community in every way we could think of. Actually the effort was going on for 4-5 years already when I arrived and the PDs that followed kept it going. Now it's unstoppable - almost like a good habit you can't give up. At the time KDKA was the station DVE was chasing and they were the community in Pittsburgh, much like WGN is in Chicago. Little by little, event by event, DVE clawed away at the community image with a rock angle to it. Now the station on top for most of the last 4-5 years is usually DVE. Is their music any better than other rock stations? Probably not, but in the community they are legend and it's an advantage NO ONE ELSE can take away built on decades of effort. The same could be said for many stations - FBQ, KQRS, WMMR, and WRIF.

15 Months of Fame Lifecycles on the Web

Doesn't it seem like in the WWW world big things only last around 15 months or so? It seems to take 15 months to watch a new application or web thing develop, then it spends 15 months as the big thing, and another 15 months winding down. Myspace is a great example starting in late 2003 and building till the sale to Murdoch in mid 2005. As 2007 began we started to see a migration of the innovators and early adaptors to Facebook. By the middle of 2008 Facebook will probably blow by Myspace.



Look at YouTube which started in 2005 and was sold in 4th quarter 2006 to Google. By the early months of 2008 we'll probably see YouTube start winding down on the 'cool meter'. Something else will replace YouTube as the next cool thing.



While not everything seems to follow the 15 Month stages brought out in these examples there is clearly a very fast moving and volatile life cycle on the web. Look at it from an advertisers side. First you went with simple banner ads on big web sites only to find that your consumer wasn't there, then to pop-ups which we all blocked completely, into email boxes where you became spam, now to Google Adwords in a complex mess of bidding and placement. Advertisers seem to be constantly running to the next big thing on the web only to find a confusing mess when they spend the dollars. Things are changing fast and will probably even change much faster.



Recently Mark Cuban was discussing the slowness of the INTERNET and suggesting that we will probably see more INTRANETS that are more limited so we can actually navigate at the speeds our computers are capable of, instead of the slow, messy, way overcrowded, constantly crashing, WWW world - read it here I bet Mark is right that we will soon out grow the old Internet and find it just too slow to handle all the video, high end audio, animation, gaming, and interactivity we will likely demand from interacting with our computers. What happens when we try to download movies in high def formats? How far can we compress audio and when do we realize how much better things can sound? Mark's speculation on the answer to the ever increasing demand on throughput to get more and more complex aplications and content on to your screens and speakers is to close down the scope of the network. Go from an INTERNET to a more smaller and more controlled INTRANET - perhaps one that is all interactive through your cable provider with it's own You Tube like sharing site and a smaller personal network that can be monitored and controlled. Take off some of the 'freedom' and open to anyone side of the web and suddenly the experience might be the next logical evolution.


How does this relate to radio? Are advertisers, marketers and clients accomplishing anything towards building their brands and business growth in an environment where things are moving so fast your message disappears in front of you. Is this like the elusive task of trying to catch a chipmunk as it darts around your garage or yard with just your hands? It's so fast and so small and has so many holes to dive into.


It seems like everywhere we go radio gets the 'old fashioned' tag on it. While it may be tempting to be betting your marketing dollars on the latest web craze and find yourself chasing that chipmunk all over the garage. Meanwhile Radio still reaches 90% of the population or more, can be bought for lifestyle and specific demographics, and still delivers a very healthy TSL compared to other media. While it may be old fashioned it's also reliable, fairly easy to craft a quality message on (you don't need hours of HTML code or complex bidding systems), local to your community and still pretty affordable.

Influentials and the Diffusion of Innovation

Dave Van Dyke and his Bridge Ratings service have just released a new study that digs in on a group of listeners Dave has branded as New Influentials. You can read the whole study report here. Dave's study found that 10.2% of radio's audience fit into this group of Influentials that are heavy users and very likely to 'spread the word' and lead others towards various formats, stations or personalities. The level of New Influentials is a little higher for Satellite Radio and Internet Radio.

Looking over the data brought back some marketing memories studying The Normal Curve and a study from the 50's called The Diffusion of Innovation.

The Normal Curve (or bell curve) is a theory based on the occurrence of any trait or behavior and is the basis for all research. The probability of something occurring within our behavior and our reliability in predicting or detecting that trait are all demonstrated and calculated in the model of the curve. All 'things' happen under the curve and the middle of the curve is where you see the highest occurrence of a trait or behavior which trails off in either direction. The middle also represents a place where we are most likely to find the trait or behavior. There are tons of formulas that are the basis of Statistics and Probability theories and figure the reliability of any study, sample variance and a host of other measurement facets.

Back in the 50s and early 60s a professor at Iowa State Evertt Rogers was trying to see how we could spread all the science and innovations going on in the 50s for farming to other countries where they were struggling to feed their populations. His books on the Diffusion of Innovation are based on the Normal Curve, breaking the populations into 5 distinct groups based on how they adapt new innovations, technology or products:

• Innovators - 2.5% - the first to pick up on an innovation or product.



• Early Adaptors - 13.5% - this group spreads the news on the product.



• Early Majority- 34% - With this group you are at 50% of the population.



• Late Majority - 34% - As you cross the center line of the Normal Curve note that curve goes down!!



• Laggards - 16% - The last to jump on

Dave's study really shows us the importance of the Innovators and crossing to a majority of the Early Adaptors. With that 10-12% you are poised to influence the Early Majority and get your station, personality or format (your brand) to that point where you can reach 1/2 of the market and beyond. This is what is also called - The Tipping Point in Malcolm Gladwell's works.

How many times have we seen strategies and tactics in programming that leave out the Innovators and the Early Adaptors? Taking out some of the features or key elements that made the station unique, tightening the music so much that we leave this influential group searching for a new innovation. Trying to smooth over a strong personality to be more adaptable to the Late Majority.

You also have to keep in mind that the audience under this Normal Curve is in a constant state of change as innovations and products in every sector and our own sector are launching. Each is gathering it's own series of innovators, early adaptors and spreading to the majorities. To stay ahead you have to identify who your Innovators and Early Adaptors are and keep them high on the station.

As you market the station and develop the content make sure you are balancing both the Innovators and Early Adaptors with the Early and Late Majorities. Perhaps one of the big reasons we see the new media building so much momentum is that Radio has left the Innovators and Early Adaptors behind and while we still enjoy the acceptance and usage of the large Majorities and the Laggards how much longer till the Majorities adapt the new technologies?

In the early 90s more studies and theories focused on crossing the line between the Early Adaptors and the Early Majority as we began to see many innovations struggle to reach beyond a small group of fanatic followers. Crossing the Chasm by Geffeory Moore is probably the best book.

The keys to using these theories and ideas in your marketing plan is making sure you are balancing your efforts. Remember that you are also marketing your product on your product - the imaging, on-air promotion, music mix, and personality all support the innovation of your product. Making sure that you have a balance in all areas for both the Innovators and Early Adaptors as well as the Majorities is the key to long term success for any station and really for our media as a whole.

Thanks to Dave and the Bridge Ratings folks for bringing these basics back into the spotlight.

Some Good Signs For Rock Music/Radio

Usually twice a year we take an in-depth look at the Spring and Fall Arbitron Format analysis where they gather all the ratings from the top 100 markets and break them down by format.

The news is usually released after all the books are out and nearly always headlines another decline for all the rock formats. The facts are there as we can see the last 8 years showing a steady decline in most demo breakouts. We've all been hopeful that someday we'd see the tide turn here and perhaps it could come as we get the first 2007 numbers in just a few weeks.

Even if the numbers don't show a turnaround yet there are lots of signs that one is happening on a number of fronts:

• Rock is HIP again - Look at all the signs from the huge popularity of Guitar Hero, overall CD/download sales of rock acts, the summer concert sales picture, and the 'Indie Rock' movement in the 16-22 age group. Look at the music out right now from Linkin Park, Foo Fighters, Finger 11, Velvet Revolver, Ozzy, Pumpkins, White Stripes, Nickelback and other fairly well established acts. We also have lots of new artists breaking
• PPM - Suddenly in the markets where PPM will be taking over there is a rush to rock. New York and Philly both signed on new rock outlets and expect to see more in the top 20 as the year progresses. PPM finally shows a lot more acceptance and listening to rock radio than we've been seeing in the diary system. Arbitron will also likely be trying to shore up the sample issues in the diary a least a little. There will still be over 200 markets on the diary system for years to come and of course we all need confidence in the numbers. Both of these events could combine to 'turn the tide.' We will probably see some confusion in the Format reports from Arbitron as they phase in PPM data. The data is different in diary and PPM and there will be issues combining it for a national perspective on formats done with 2 different methodologies.
  
• Howard's History is fading - One of the big reasons we saw declines in 06 was from Howard leaving and seeing many of the CBS rock stations either change to a full talk format or at least have their ratings chopped up over Howard leaving.
• Other Formats - Look around at the other formats - CHR is struggling a bit as a lot of the core younger audience is very into other media. Country seems to be in a little lull for artists right now - no one is crossing over or getting huge notice outside the format core. A/C doesn't have a huge new artist and note that Christmas music is months away rock could benefit. Urban is also a little light lately as the rap/hip hop artists are not as rebellious and authentic as they were a few years ago - too much commercialization and bling have worn out their welcome. Hispanic may still be impacting some markets but here we also see a leveling of the playing field as PPM will not show as much listening as we see in the diary where Hispanics can 'vote in a diary' for their culture and language vs. recording what they actually listen to with a PPM monitor.

We're about 3-4 weeks from the report and it could be a confusing one from Arbitron, but the signs are there. Now back to trying to best my son's score of 99 on Kiss' song Strutter on Guitar Hero - a song rock radio added nearly 20 years before he was born. I bet we'll see even more teen and 18-24 number for Classic Rock formats over the next few years and we'll happily have Guitar Hero to blame.

Completely Missing The BOAT

After reading Little Steven's comments again on the state of the record industry a few follow up thoughts came to mind. It's rather obvious that the record industry hit a real opportunity and crossroads in regards to downloading music vs. the old CD/LP/Cassette distribution system they had built their business on. We've all seen industries tank because they didn't see the rushing train of the future heading full speed right at them.



When you look at the record industry they totally missed the boat and are sort of rotting having run a ground. Their big mistake - why didn't they just offer up a few million (a lot less then their legal fees, funds going into Sound Exchange and suing their own consumers) to the teen age Shawn Fanning (creator of Napster) back in 1999 and build a whole new distribution system on his model.



Look at Yahoo who paid Mark Cuban huge sums to just buy Real Audio and build their audio distribution platform. The record industry could have taken the same tact and built a huge profit center - instead they allowed Steven Jobs to build it 5 or 6 years later and use it to sell his I-Pod and in the end that device will control their future. They also started a little fire within a whole new wave of costumers who set out on a mission to embrace the new world of distribution and build it with or without them.


In many ways radio is at the same crossroads with new technology. We can't join together and just buy out streaming, social networks, widgets, cell phone or WiFi distribution but we could at least be a huge player with our experience in providing content. Instead we've been cautious, penny wise/pound foolish, and just plain cheap in jumping into the new area.



It may not be too late!!! Frankly we need to look beyond HD Radio and take our brands to the whole new interactive, web based, and world market arena. No, we won't find a huge pot of cash 6 months after we start, but we will save our industry and be a part of a whole new world of distribution. Let's not make the same mistake as our friends in the record side.

Radio and Records THE RELATIONSHIP AT THE CROSSROADS

Recently you've probably seen the industry sites and blogs dealing with the comments and 'findings' expressed by a Texas based economics professor Stan Liebowitz on the relationship between Radio and Records. His angle is that the time spent with broadcasters playing music on the radio has actually hurt sales of new CDs and artists has of course run counter to all that we know about how much radio airplay (on any band - AM/FM/Satellite/Internet) has contributed to the awareness of the artists and their songs. Most of us who have been a part of exposing the music to lots of people know that it has helped many artists get exposed and many to make lots of $s. But, we see the record/artists industry grasping for more fees and 'taxes' associated with exposing their creative works and Mr. Liebowitz's claims here only fan the flames. Of course anyone on the planet knows that most of this was the record companies and perhaps some of the artists clinging to the old analog/cd distribution in an obvious consumer conversion to digital. They missed the boat so let's go drum up revenue somewhere is a 'cheap shot' but one we all have to answer.

Recently Dan Kelley who hosts http://www.classicrockfm.blogspot.com/ and also has a great background as a programmer and ops manager in our industry passed on Little Steven's comments on the whole issue. Remember that Little Steven is a very talented guitarist from Bruce Springsteen's E Street Band and also a host of Little Steven's Garage as well as an actor in the Sopranos but his perspective here is well thought out and does have a balanced angle on the issue. I have copied his comments from his Billboard Garage site below - I think we'll all agree with his well stated observations:

GARAGE ROCK July 21, 2007

LITTLE STEVEN VAN ZANDT
As even the slowest of us start to realize there will be no getting out of this permanently bad economy, that it isn't a cycle or a temporary blip, we will begin to see the last vestiges of reason, logic, pride, quality, integrity and dignity fly out the window.

Of course few of us will notice since most of those things have been systematically compromised, trivialized and marginalized by our corporate elite, and Lord knows our government, for quite some time and live on in our culture exclusively in disparate groups that by now must resemble religious cults and pitifully handicapped social niches.

The latest evidence of this sad loss of logic, pride and integrity comes in the form of a feverish obsession by virtually everyone to make all those greedy, evil radio stations pay for the privilege of playing our precious records.How dare they!

The free dance is over, buddy, it's time to pay the piper! It's perfectly obvious that this has been the problem with the record industry all along. Too much damn airplay!

And now that we've figured out that radio is the enemy, we're going to need a spokesman to voice our feelings and calm the outraged millions of customers who are angry and embarrassed at having been hoodwinked into foolishly buying records simply because they heard the song on the radio.

And ladies and gentlemen—right on cue—here he is:University of Texas at Dallas economics professor Stan Liebowitz, who argues that radio "acts as a substitute for music sales. If they weren't listening to the radio in their cars," he opines, "they might buy more CDs. "What else is he teaching those lucky kids in Dallas? That those oil wells out the window are the real keys to the greening of America?

With all due respect, professor, why will everyone be buying these CDs, or downloading or whatever? Because they like the artwork? We have talked about, right here, the new ways people hear music and its significance especially for young bands: ads, videogames, TV, movies, ringtones, car horns, whatever.But can any sane human being think all that can ever replace a great radio station?

Could it be that the professor has forgotten, or is too young to know, that there would be no record industry without radio?

Does anyone think it's a coincidence that ever since radio has been playing less and less new music, new music sales have gone down?

And now we want to make it less profitable for radio to support new music?I am a songwriter and a performer and I own record companies and publishing companies and I do not believe radio should pay anything to anyone.

And I mean every kind of radio.Let me go further and say anyone performing a song on TV or in a movie in a concert context shouldn't have to ask permission to do it or pay anyone either.Soundtracks? Yes, that's different. Videogames? Yes. Ads? Yes.

But radio stations and concert performers shouldn't have to pay for promoting our music and helping us sell it. Radio is the greatest thing that ever happened to us all, not counting Les Paul sticking that pickup on his guitar—which also worked out quite well.

The record industry, the publishers and our government should be doing everything possible to help radio, old and new, and start treating it like the national treasure it is instead of trying to kill the golden goose that's carried everyone for 60 years.And as for you economics professors, how about you spend some time figuring out why the value of the dollar is worthless and leave the music stuff to us?

See you on the radio.

THANKS LITTLE STEVEN.