Radio's New Youth Format Discovered in Anaheim!

Over the weekend I had the chance to visit Vidcon in Anaheim, California,  the yearly celebration of Internet celebrity that has become a harbinger of changes coming to the entire media industry. Now in its sixth year, the convention brings together the entire Internet celebrity ecosystem together for a few days of panels, selfies and hugging — lots of hugging.

Jenna Marbles - 16 million subscribers
Captain Sparklez - 8 million subscribers
Toby Turner - 15 million subscribers

The experience was like jumping on the train that is pulling youth media consumption beyond anything we have experienced before.

The idea of internet celebrity was foreign to most just a few years ago. Now, things have changed.

The Internet celebrity phenomenon has its roots on YouTube, which remains the dominant platform at Vidcon. Long before creators like PewDiePie were making $7 million per year, the first YouTube stars were making just a little money off ads that ran alongside their videos. Some creators banded together to create the first "multi-channel networks" (MCNs), companies that grew to include thousands of stars and enjoy big acquisitions from major media companies.

And there is serious money here, too.

This mix of investment capital and ad dollars — something that wasn't around as recently as a few years ago — has dramatically changed the industry. Andrew Graham, a senior talent manager at Big Frame, a talent management firm that specializes in online stars, told me that YouTubers that might have once just wandered Vidcon with friends now have a big entourage.

"All of them have attorneys. They all have business managers. They all have publicists," he said.

The person-to-person authenticity that has become the hallmark of this cultural movement — and what makes it so appealing to marketers — is apparent in real life as well. Every so often someone will recognize someone else that they watch online and stop for an impromptu photo. If they're reasonably well known, a surprisingly orderly line or group will form.

There is a friendly closeness that seems to exist between these YouTube stars and their legions of fans. Everyone is calm. There is no drama.

You can see where I'm going with this.

In addition to talent managers, I spoke with some of these internet video stars and you may be surprised to learn that there is interest in expanding their brands into traditional media.

n fact, the media presence at Vidcon was considerable. Entertainment Weekly and People had a massive interview stage that was running just about all day for the duration of the convention, Thursday through Saturday.

NBC and ABC were there too in the form of their respective late-night shows featuring Jimmy Fallon and Jimmy Kimmel. Of all the mainstream media attempts to break into this world, variety shows seem to have had the most success, with Fallon in particular generating numerous viral hits.

Coverage of this event is going more mainstream much like the history of coverage of San Diego's famous Comic Con which attracts 250,00 a day each summer.

Broadcast radio has, in many/most cases, lost its pioneering mojo. The industry has been on the defensive for fifteen years. What it needs is something to kick-start interest, awareness and add a bit of the "coolness" factor.

Through the ages, coolness has had its roots in youth. Broadcast radio used to appeal to this group, but in recent years it has seemingly abandoned interest in this group of forward-thinking consumers. The primary reason has been based in the theoretical lack of advertising dollars that could be accrued for a radio format catering to this group.

However, look anywhere advertising and marketing appear these days and you'll see which consumer groups are monopolizing the advertising dollars.

Click image to enlarge.

I found enough internet video stars at Vidcon in just two days interested in providing audio (and video) content to a radio station with the courage to do something different. Money follows these kids and an advertiser base in both audio and video would exist from day one.

Just imagine. A compelling, youth-based radio format featuring the top internet video stars providing relatable talk and music content as well as video content that can be housed on the station website and distributed to throngs of teens with mobile devices hanging on their every word.

Resuscitating broadcast radio doesn't really take much: just some ingenuity, creative thinking and courage.

Someone take this opportunity to do something important. 

If these internet video stars believe they could attract the youth audience back to radio, then so should you. One of these stations in each major market could change things quickly for the broadcast radio industry.

I'll be glad to discuss this idea. Let's do it!

Dave Van Dyke
President
Bridge Ratings & Media Research

Nielsen Schmilsson

With due respect to our friend Harry Nilsson and his fabulous 1970 album "Nilsson Schmilsson, the title of this blog represents the dissatisfaction I detected following ratings company Nielsen's "PPM Enhancements and VOLTAIR Testing Update" webinar on TUESDAY (7/21).

Following the webinar, I spoke to 17 radio managers - a mix of station managers, program directors and chief engineers to hear their take on the ratings service that costs most of them six-plus figures or more a year.

Here are some of their thoughts:

1) The lab testing NIELSEN did with VOLTAIR is inconclusive in real-world analysis. Among the engineers I spoke with who were on the call, real-world PPM device sensitivity is difficult to duplicate in a lab environment. Actionable results in-lab will be few.

2)  In-cabin listening in a vehicle with open windows, low volume radio and even in-car talking is difficult to duplicate. Much of VOLTAIR’s benefit has been experienced in these real-world conditions.

3) In-office listening environments are also difficult to duplicate in order to feel confident in NIELSEN’s testing. The audio artifacts in these environments are tough to predict.

NIELSEN also stated that VOLTAIR can impact audio quality for listeners. There was little agreement with this statement among those I spoke with. As one PD put it, 'Would we be using it if the quality of our on-air sound was negatively impacted? No.'

4) The fact that NIELSEN admitted that VOLTAIR enhanced PPM in “some situations” is a confirmation that in NIELSEN’s eyes, VOLTAIR does improve their technology. Yet they step back by stating 'whether this is true listening is inconclusive at this point.'

Most radio managers I spoke with were disappointed with the call. After months of 'no comment' from NIELSEN, it was generally hoped that a more detailed and finite determination would be presented.

Confusion remains as to the actual meaning of NIELSEN's comment that "Nielsen will not support the VOLTAIRE product."

Image credit: radioinsights.com

Image credit: radioinsights.com

NIELSEN most certainly will not technically support the VOLTAIRE product...we know that. Through a layer of gauze, the ratings company seems to imply that if a station is using the VOLTAIRE box once they roll out changes in the watermarking algorithm in fourth quarter and distribute new next-generation encoding monitors to all clients in 2016, possible ratings distortion penalties could be assessed.

We really don't know what NIELSEN will do and this is at the core of the ambivalence of most of the managers with whom I spoke. 

Questions remain:

Among them:  How close to VOLTAIR’s solution will NIELSEN's improvements they intend to introduce this fall and will there be additional station expense? 

How will NIELSEN’s 'increased density of PPM codes' compare with results current VOLTAIR users are experiencing?"

Nielsen has three months to answer these questions and others.

 

At the Crossroads....or past it?

Have you heard of “Trajectories of Industry Change”.

Historically, all industries find themselves faced with gut-wrenching decisions related to remaining relevant.

Compare the lifecycle charts below for MySpace and broadcast radio.

The relevance clock for broadcast radio is nearing midnight which means little time remains for the industry to adapt to the times.

According to author and business strategist Anita McGahan, who observes all types of industries and companies, traditional radio may no longer be at a crossroads, but beyond it and should seriously heed the warning signs presented by new competitive media. She explains that broadcasters are misreading growth clues and may be arriving at false conclusions.

The most important thing to understand, she says, is that all business goes through lifecycles during which obsolescence becomes a real threat to the core of the business. New technologies shake up all industries and all companies at some time are faced with ‘defending their turf’.

So, what has really been going on with the broadcast industry?

Radio has been caught in an evolution as a result of Two Types of Threats of Obsolescence from digital media:

1. A threat to its core activities (those activities of attracting listeners with programming, technology and delivering consumers for advertisers), and

2. A threat to its core assets (durable resources such as talent and programming and intangibles such as programming knowledge and brand capital, that have historically made radio effective at delivering audiences).

Based on the nature of these threats, the broadcast industry has been on a growth curve with the following identities:

Phase 1 (1960-2000) – The Stable Trajectory when neither its core assets nor core activities are jeopardized. During this phase the industry was operating effectively and efficiently, it understood its strengths and weaknesses with no significant outside competitive threat(s).

There was a balance between investing in product and sales.

Persons using radio 1980-2012. Click on image to enlarge.

However, this phase began to weaken after an extended period of wealth and profit-taking. The traditional radio industry had been on a Stable Trajectory until around 2000-2001 when a “perfect storm” of weakening economies coupled with the rise of new technologies began to threaten its core.

Phase 2 (2001-2007) - The Intermediary Trajectory – the period after successful times when the industry began to experience new competition generally aided by new technology when either its core activities or core assets started to become threatened – but not both. It was a time when a “tipping point” was approaching and there was still time to adjust and avoid significant damage to revenues, profits and consumers.

This phase is often characterized by short-term profit-taking as a reaction to this new threat while avoiding investment that could later prevent competitive inroads.

According to Dr. McGahan, the traditional radio industry at this point of the trajectory curve should've fended off attacks to either its core activities or core assets by reinvestment in those core strengths. Defensive strategies should've come from company marketing, product,  sales and technical innovations which would've refreshed perceived obsolescence.

Phase 3 (2008-Present - A Radical Trajectory, the most serious, occurs when core assets and core activities are both threatened with impending obsolescence. Often considered too late in the lifecyle to recover from severe competitive and technological inroads, industries in the radical phase may never be able to infuse enough funding back into the business to fend off the momentum of on-coming competitors. It is often too late for industries in this phase to offset the negative momentum of consumer attrition.

These three trajectories of industry change can be applied to most industries.  Read more here.

With this in mind what path remains for broadcast radio?

I'd be interested in your thoughts.

Your feedback is vital to our company's on-going success. As always, I look forward to hearing from you.

Sincerely,

Dave Van Dyke - President