Music Is Killing Radio

Now downloads are down to under $1 billion.

Remember when record sales accounted for $16 billion a year?

It’s more like half of that now and declining.

Pandora, Spotify and YouTube are not coming anywhere near replacing the revenue from lost record sales even with those lopsided licensing deals that supposedly favor the labels.

Spotify has 15 million paid subscribers and with all due respect that is nothing compared to all the Spotify users who are getting it for free with ads.

The artists are getting pennies but don’t blame the streaming music services. Record labels have always screwed the talent out of their fair share of revenue.

YouTube is so popular with teens as a replacement for radio it is scary and still the geniuses in the music industry are making only pennies on streaming rights compared to record sales.

While the music industry contracts along the lines that a handful of powerful record labels have dictated, 95 million Millennials are now using music like toothpaste instead of the way baby boomers did.

Radio in an effort to save money has dumbed down its stations to a continuous loop of repetitive music with announcers that sound like their puking on the sweepers between the music.

There is no reason to believe that Millennials will use music any differently than they do now – it works on the fly, on digital devices, in the background for gaming. And they certainly don’t need radio stations to tell them what they want to hear.

Yet, things are about to change again in music and by extension, radio.

  • High-resolution audio is coming. It’s present on TIDAL and Deezer now. Whether it will breath life into the music industry is not known. I doubt it.
  • Apple will try to disrupt streaming media when it converts Beats into a more affordable monthly stream. Can’t see how Apple – the people who helped kill off albums – will stimulate the music business with this venture.
  • Vinyl continues to grow – go figure.  Scratches and inconvenience equate to a warmer, richer sound for those who care. Question is, will enough people care. I doubt that, too.
  • Pandora has been growing local ad revenue over 100% year to year and ended 2014 with 109 local sales reps (mostly recruited from radio) so while Pandora listening favorably competes with radio in many markets, they are also draining ad revenue from music radio.

Music is what made radio.

Now it is what’s helping to kill it.

Don’t get me wrong. People will always listen to music. But the way they value and use music has definitely changed.

Meanwhile radio companies are plowing ahead for another lousy year losing audiences, time spent listening and revenue and refuse to rethink their use of music as a programming tool.

If you’re open to changing the way you program music stations, you’ll want to hear the concept and information I am going to present at my Philly conference two months from now.

That’s a game plan that can favorably alter the outcome for 2015.

Here are some other critical things we should get ahead of:

  1. Too Many Commercials – How spots are scheduled can make a difference.       Also, the length of spots in each stop set. There is much that can be done. To proceed as is is not a solution.
  2. Unremarkable Programming For 70 Million Baby Boomers – All the focus is on young money demo Millennials. Baby boomers have been radio’s most loyal listeners but that’s changing now. Ignore baby boomers, target them or better yet discover what the two disparate groups have in common.      
  3. Outdated Morning Shows – They like personalities but increasingly they don’t like much else about morning shows. Focus on three new features to replace traffic, time checks and weather. Yes, they don’t need them. But consider these three potent options to replace tired old staples of morning radio. (And you can sell them!)
  4. Music That Is Too Repetitive – Audiences have hated music repetition on radio for decades but they had few alternatives. Not so anymore. Two new strategies show promise. One adds more new music without watering down the hits. The better approach is to rip up the traditional playlist and present the music differently.
  5. No Compelling Reason To Listen Longer – Radio TSL has been down every year since the early 90’s. Under 30’s don’t even listen to any song all the way through even though music radio is built on the assumption that if you play the right songs, the audience will stay tuned in. Now, there is a way to keep listeners from straying and it isn’t longer music sweeps.
  6. Don’t Like the Way Stations Talk To Them – Sounds dated, insincere.  Too much bragging and hype.  It all sounds like radio is out of touch. Talking down to listeners whether we mean to or not. Surprising words that turn off young audiences when used on the air, in promos, sweepers, imaging and commercials. Learn them and overcome this objection.
  7. Radio Is Not Authentic – Demographers have discovered 5 things that Millennials crave. Do these 5 things every hour of every day and radio becomes more relevant to the 95 million members of this age group. One of the 5 things they crave is more authenticity. Learn the fastest way to master being truly authentic to Millennials but also the four other expectations that radio is currently not meeting. They are screaming this out for you to hear.
  8. Lack of Music Variety and Customization – Spotify, Pandora and YouTube are killing radio when it comes to variety and customization.  There may be no way to compete with that, but audiences are beginning to tell us what these streaming services are lacking presenting a great opportunity for responsive radio stations to do what streaming services cannot do.
  9. Outdated News and Talk – Two staple radio formats are seeing audiences erode or attracting unsellable aging demographics. News stations don’t just sound like their father’s radio station – they sound like their grandfathers radio station. Droning on and on with sleepy features designed for station sales managers not for listeners to crave. Conservative talk is also over because audiences want compromise not red meat.  And Progressive talk radio never really worked. It’s a no-win. But spoken word is something young Millennials like, really like – here is the spoken word station of the future (bring an open mind).
  10. Don’t Know Where the AM Band Is – Think about it. There’s nothing for audiences under 60 on AM. So you may be thinking that younger money demos won’t listen to an AM station, right? True, unless … well, I’ll show you a number of things you could do on two tin cans hooked together with a string that Millennials would eat up. Will you take that challenge?   Because I’m going to do it and you’re going to want to brainstorm on it.  Forget the FCC. AM needs to disrupt FM the way FM disrupted AM.      

PLUS, What Audiences REALLY Want In Digital Content …

There is nothing worse than doing something well that doesn’t need to be done at all. Some stations are doing impressive digital initiatives that audiences simply don’t care about.

Instead, drill down on what listeners really want in digital and get a better return on your investment in time and money:

  1. Storytelling Instead of Podcasting
  2. Short-Form Video Revenue Stream
  3. Non-hyped Social Media Beyond Facebook and Twitter
  4. Content Audiences Can Binge on Just Like They Do Netflix
  5. Apps Not Websites (and That Includes Radio)

Two months until the Philly Conference and I’m getting excited to be with you and lead this seminar to transform the industry for the future.

Reserve a Seat

Contact Jerry about the conference and group rates here.

The 6th annual Media Solutions Seminar is being held this year at The Hub Conference Center March 18th in Philadelphia, walking distance from Amtrak’s 30th Street Station and 20 minutes from Philadelphia International Airport.