Is the Radio Performance Tax Reverse Payola?

According to Merriam-Webster, the definition of payola is "Undercover or indirect payment (as to a disc jockey) for a commercial favor (as for promoting a particular recording)."

There are two bills in congress, H.R. 848 and S.379, that, if passed into law, would levy fees against radio stations for playing music. Wait... WHAT??? Isn't that one of the things radio is supposed to do? Play music so that people will hear it and then go out and BUY it?

To listen to the record companies and the artists themselves, you would think that radio is stealing their product. Since the dawn of entertainment-based broadcasting, radio has been used as a means to help promote music and artists. You hear the song, like it, and purchase it. Payola was even used as a mans to get radio stations to play songs more often because, say it with me... MORE AIRPLAY MEANS MORE SALES!!!

Now that the record companies are having trouble staying financially in the black, they are looking for new streams of revenue. Hey... let's charge the people that are helping us a fee. Keep in mind, that radio stations ALEADY pay a licensing fee for the music.

Radio is already in enough trouble. The major groups are all starting to file for bankruptcy protection, literally thousands of employees are being laid off, and syndication is becoming more the rule than the exception. Let's face it... from a financial standpoint, it's cheaper to have Ryan Seacrest host 100 of your morning shows than to actually pay for 100 morning shows. I'm not saying radio is innocent in all of this. Consolidation has more or less killed the industry. But... that is a different issue. If these bills pass into legislation, even more people will lose their jobs, and the small radio operators will probably disappear altogether. You will see a good majority of stations switch to talk/news/sports formats. In a lot of cases, it will be cheaper to just shut the transmitters down and call it a day. College radio? forget it... it will completely cease to exist.

And of course, the artist themselves are up in arms over this. "How dare radio play my music without compensating me?" Ummm... let's go back to paragraph #1. Airplay translates into sales. It's promotion. You provide the content, radio turn that into sales. And NOT just sales of music. We're talking ticket sales for concerts and merchandise... both multi-billion dollar industries. Bono has been one of the most outspoken performers in support of the tax. And he's one of the richest people in the galaxy! Click Here to read what the NAB had to say in response to Bono. I certainly understand that Bono does a LOT of charity work. I appreciate that. But if it wasn't for media airplay from early MTV and radio, U2 wouldn't be around today and Bono would probably be a bartender in Dublin instead of owning half of the city! Why do you think artists like the Grateful Dead, Phish, and Dave Matthews ENCOURAGE people to record and trade their music? They know that they might lose some music sales, but they are gaining in merchandise and ticket sales. And The Dead have been around in one form or another for almost 50 years! Sounds like they know what they are doing!

The only music you would probably hear on the radio is that of the biggest artists in the world... the U2s, Rolling Stones, Britney Spears... If you were a new artist trying to get heard, it wouldn't happen. Whatever happened to the thrill of a new artist hearing their song on the radio for the first time?

Yes... the musicians have a right to be paid for their material. I'm not disputing that. But it is the responsibility of the record companies to pay that. NOT the people trying to help them sell more records. If more artists were to examine their contracts BEFORE they signed them, or learned to negotiate better deals, then this wouldn't be an issue.

And how would radio pay for these fees if passed? Well, other than laying off even more people, advertising. I think that most "casual" listeners of radio would agree that there are too many commercials as it is. I think that a good average would be 12 to 13 commercials per hour split into 3 commercial "stopsets." If these laws pass, I have no doubt whatsoever that 20 minutes of commercials per hour would become common.

The record companies know they screwed up big-time when they didn't jump on the digital bandwagon. And now they are trying to make up for lost time. Piracy is rampant and it's because the music industry DIDN'T see digital music as a viable platform. For the record (no pun intended), my iPod currently has well over 28,000 songs on it, and it fits in my pocket. How many CDs would I need? The music industry needs to learn to embrace new platforms, not just decide to stick with the old ways of doing business. If they did this back in 1997, there would have been more safeguards against music piracy in place BEFORE it became a major issue.

So... back to the original question. Is this tax a form of revere payola? I think the answer is "yes." even though payola is illegal, record companies embraced it for years as a way to get their artists more "PROMOTION" by getting records more spins on the air. Now they are asking, no... demanding that radio pay them for the right to promote their music.

I would encourage people to take a look at this website... www.noperformancetax.org to get more information.

"Secret" Moneymaking Formula for The Recession

In light of the emphasis being made here on Web 2.0 and Social Media (and we at Radio Twit are nothing if not both of those), it seemed like a good idea to introduce an item I've shared elsewhere. So, if your one of my faithful readers and you've seen this before, forgive the redundancy. If you haven't seen it before, it's germane to you--and you might also want to share it with any sales people who need a little boost.

THE ECONOMY SUCKS--BUY MORE ADVERTISING?

No, it's not just the claim of sales people who want more business.

Yes, historically speaking, buying more advertising in an economic downturn really does work.

Of course, I can sit here, talking about theories all day.

And it's easy for me to say, "The economy sucks! Buy more advertising!"

Slow Burn Marketing don't presently have any clients with ongoing traditional media schedules. (Right now, all our clients are either engaging in web and guerilla marketing, or are just getting their marketing off the ground for the first time--which means we're embroiled in devising strategy and creating branding materials--which is a whole other kind of insanity.)

So, I'm relegated to citing proven historical facts.

AND TODAY, WE HAVE A NEW, RECENT HISTORICAL FACT TO CITE

It comes courtesy of David McBride, a radio account rep in Los Angeles.

David has always been very happy to bang the drum for increased ad spending in an economic downturn. That's why, last week, he was able to say this:

I just met with a client of mine that INCREASED

advertising in 2009 (what a nut, huh?); this company

had their best year ever... This client increased their

advertising budget in 2009 and hit a business goal

that has been eluding them for the past four years.

YA KNOW WHAT'S SO COOL ABOUT THIS?

It's not just that this advertiser had their best year ever.

It's that, by increasing ad spending, they reached a goal that had until then been utterly elusive.

To paraphrase William Wrigley, the chewing gum magnate who famously advertised his gum all during wartime when it wasn't available to consumers, advertising is an engine that drives the business.

To paraphrase John Wanamaker, the department store magnate who famously created advertising as we know it, half of all money spent onadvertising is wasted--the trouble is, you can't know which half.

I've espoused Wanamaker's philosophy before.

HERE'S WHERE I'M GOING TO SAY WANAMAKER DOESN'T APPLY

For the small business who has increased advertising and finally reached an elusive sales goal, I don't think ANY of those ad dollars were wasted.

I doubt he will either.

And that advertiser is not the only one of David's clients who's doing well. He has "a few others [who] did the exact opposite of what the conventional wisdom told them to do and they flourished. Many, passing some of their biggest competitors in the process."

WHAT'S DAVID'S MAGIC?

It's not so magical.

It's merely candor--candor of the kind that so many readers to his pathetic weekly screed already possess:

I tell them the truth regarding their advertising

whether they want to hear it or not... I'm not the

typical media rep that tells them what they want

to hear. This is why I can discuss success

stories in the middle of a recession when others

are crying the blues.

Apparently, if telling his clients the truth hurts, it hurts so good.

Special thanks to David McBride, who had no idea he was going to be quoted so liberally in this screed. I had no choice. He inspired me.

A radio advertising Creative Director in Los Angeles for over a decade, Blaine Parker is a principal in Slow Burn Marketing LLC, a small and feisty marketing agency perched on a mountaintop outside Park City, UT. If you'd like to see more of his pathetic weekly screeds, feel free to visit www.slowburnblog.com

Don’t “get” Social Media? Think like a Musician.

2009. The year of the Social Media explosion. Thanks to Facebook and Twitter primarily, the world has found a new way to stay connected, interact and experience each other.

Of course, businesses and marketing types have noticed the power of these new fangled tools and the great ways they’re influencing both the masses and products.

One of the hottest new jobs in 2010 will be for people who know how to harness the power of these tools for individual companies and brands. Seminars are popping up everywhere with “experts” and “guru’s” willing to help explain this new landscape, why it’s important and what it all means. I’ve attended quite a few over the past year. Some have been worth attending. Many have just been common sense.

DISCLAIMER: I’m not an expert. I’m not a guru either. But I like to think I get it.

I like music. Like most people, it moves me. It’s been a part of me all my life, thanks largely to my Dad. I’ve personally interviewed at least a couple hundred certified Rock Stars over the years (real Rock Stars…not to be confused with the Social Media standouts claiming the title per their awesomeness). The beauty of musicians is their willingness to expose themselves to an audience. Their words are intimate, if only to them. They’re more so than not, authentic in their personality and not everyone gets them because of that – but that’s ok. They have a tribe of fans who do get them and are willing to do anything to champion the success of their star.

Musicians are tied to community. They’re passionate about cause and the human condition as it often feeds their inspiration. When they write (just like Twitter and Facebook status’s), their words reach out and relate to someone else who sees things as they do. It creates a connection and apparent conversation. It’s personal between the artist and listener.

U2 360

I had the pleasure of seeing U2’s 360 Tour at Carter Finley Stadium this year. From the minute I walked into the stadium Bono was speaking my language.

“Do you like our stage? We call it “The Claw”. We built it this way to get closer to you…to be more intimate”, he said. It reminded me more of a giant spaceship come to take us all away. I dare say by the end of the concert if Bono had said “climb aboard”, we all would have. He was that good.

He had me. Not only did he just drop a concept right out of the Social Media handbook, but the stage was set up like the popular island exhibits you see at conventions. At trade shows, it’s routine, but out of the numerous concerts I’d seen, this was the first for me. U2 accomplished what I’ve been telling my exhibit customers since the early 90’s. Use the structure to stage the tone and message, but get rid of obstructions and allow free flowing traffic. Remove the barriers. Allow access (if only in perception).

Throughout the show, Bono connected. He delivered the pillars that make Social Media so appealing; community, engagement, conversation, transparency, authenticity, content, intimacy.

Another one of the most well rounded shows I’ve ever seen ranked right up there with U2 is jazz musician and trumpeter Chris Botti. The show was flawless. It was just a great ride. It rocked. It swooned. At times, he made it big. Other times, he brought us in nice and close. It was an experience.

One of the more disappointing shows this year was blues guitar phenom Joe Bonamassa. He only said one brief thing the entire night…at the beginning. His performance on the guitar was breathtakingly impressive not doubt, but it was a one-sided show. He lacked content so he never engaged or connected…at least with me. The blues are chocked full of stories and emotions to draw on. I never felt his.

Sting

“If On A Winter’s Night” is the latest project from Sting. This past Sunday morning, CBS’s Sunday Morning with Charles Osgood featured an interview with the virtuoso. Sting talked about how playing in a church or pub is very different than playing a large stadium full of people. It’s a different mindset.

“In a large stadium event, your goal is to make it an intimate a setting as possible. In a small intimate setting, the goal is to make it an event.” [paraphrased]

Experienced musicians know how to connect. They make it personal regardless of the venue or transaction.

As your company moves into 2010 and considers implementing Social Media into its marketing and branding mix, keep this in mind. It’s not rocket science. It’s just personal.

We’ve all gotten comfortable over the years doing business a certain way and for the most part it worked, right? The barriers for your customers have been knocked down now. They have access to more information, education, choices and people now more than ever. They trust status updates and their friends more than what we as businesses tell them is good for them. We all can be replaced by something faster, better and cheaper in an instance.

The good news? It’s still all about the way you treat your customers. Remember the email and website explosion of the 90’s? This is so much cooler. Once again, you’ve got a new set of tools to play with…to stay connected, interact and experience each other.

The bigger the transaction, the more intimate it should be. The smaller the transaction – it’s still a big deal to them.

The world’s a stage. Go play.

Crazy Radio Stalker Story #2

Last month I told you about "Linda"... one of our stalkers. Now I'm going to tell you about "Bob."

I've worked for a lot of radio stations in all formats. I've found that the rock format not only has the most loyal fans, but it also spawns some of the craziest fans. "Bob" technically lived outside of our market, but certainly within listening range. And he was one of our most rabid fans. Here's a few stories:

"Bob" really thought he was one of the group. He liked to call the listener line and talk to us about... well... really nothing. There was one time when on of our weekend jocks received a call, and recorded it. "Bob" went on and on about his personal life, his love life, his money issues, etc... and after about 20 minutes, our DJ finally interrupted him and said he was sorry about putting him on hold, and could he please repeat what had been said. Of course, he was never really on hold. And yes, it was a little cruel. But that recording kept us in stitches for weeks!

There was a time when our morning jocks were lamenting on the air about how they wish they had remembered to record a bit they had run. "Bob", who lived an hour away showed up at our doorstep an hour later, cassette tape in hand. He told me that he called in sick to work in order to drive that tape up to us. Nice thought... but really... who does that? It's certainly not worth taking a sick day for. Especially because our morning jocks really didn't care. They were just making a comment on the air.

"Bob", like any good stalker, liked to come to as many radio appearances as humanly possible. There was one weekend when my station was set up at a fair that lasted 3 days. Being the promotions director, I was there pretty much the whole time. On Saturday, I had gotten there around 6:30 in the morning. It was the middle of August, and admittedly, by 9:00pm, my patience was pretty much shot. I was hot, tired, sweaty, and all I wanted to do was go home, take a shower and climb into bed. This is when "Bob" showed up. He literally cornered me and talked at me for 1/2 hour. I hated to do this, but one of our weekend jocks/receptionist was about 20 feet away. Kelly is one of the nicest and sweetest people you could ever meet. And a very good friend of mine. And I completely threw her under the bus! I asked "Bob" if he had ever met her. He said he hadn't, so I introduced them and made my escape! The next day Kelly told me he talked at her for over half an hour! Years later, I'm STILL apologizing!

And here's the capper... my phone rang one day and "Bob" was on the other end. He had a GREAT idea that he wanted to run by me. As I mentioned earlier, he lived out of market. He was telling me that he noticed that we didn't have much of a presence in his city. I explained to him that we were concentrating on our market and it didn't really matter that we didn't have a visual presence where he lived. He completely ignored me. His idea was that he wanted to get his car logo'd for us! Um.... NO!!!!! I understand, and appreciate radio fans, but he was really taking it too far. Thankfully, I was able to talk him out of it. Nothing like having your station's logo on a beat up 1985 Dodge Aries!

The point is that you have to be careful about the fans of you radio station. NEVER eat cookies that a fan baked and brought to to you. NEVER give out personal information. ALWAYS find somebody to walk to your car with late at night. "Bob" and "Linda" were harmless... but you don't know when one of these fans could just snap. Just ask my former night jock who had an angry fan show up at the station with a loaded gun...

Hope you all have a very Happy Thanksgiving!

DON'T JERK AROUND YOUR ADVERTISING

I hopped in the car last night, and immediately heard a commercial for a local car dealer.

The entire premise of the 60-second message was "We won't jerk you around."

Granted, there was some valuable sales pitch in there, like how they really do work hard to approve people with credit challenges. But those few real carrots were wildly overshadowed by the constant assertions that "we don't jerk you around" and repeated calls to action that involved a URL and a phone number, both relying heavily on the word "jerk."


JERK IS AS JERK DOES?

I would love to know how this guy's radio commercials are working. Because from the standpoint of an automobile consumer, I was left totally cold. The entire advertising message was a protestation of something that (a) hadn't been on my mind and (b) reinforced the idea of being jerked around.

Were this advertiser my client, I would have asked hm to stop telling me what he wasn't going to do, and start telling me what was so great about shopping there.


WHAT'S THE BETTER REALITY?

I've done a lot of car dealer advertising, and one of the most gratifying things you can find out about such an advertiser is that people love shopping there. Then, it's a matter of tapping into the customer experience, and using that glowing light of happy customers to elevate the car dealer's brand.

I've NEVER let an advertiser say, "We don't screw you like the other guys." And the reasons are simple. One, it's a reinforcement of the idea you don't want prospects to consider. And two, in pointing an accusing finger at the competitor, it also points the finger right back at the advertiser.


RADIO IS A DANGEROUS MEDIUM--HANDLE IT CAREFULLY

Unfortunately, we hear "we're not like those other jerks" all too often in radio advertising--the one medium where making such accusations can backfire the worst, simply because radio advertising can be so emotionally charged, so potent, and so emblematic of the notion that people do not pay attention to advertising in any specific, intellectual way but in a generalized, emotional way.

Back when my wife first started working in New York ad agencies, there was a copywriter she worked with who said, "If you're ever in a meeting and my name comes up, never say 'Don't fire John.' Because people never hear the word 'don't.' They hear only the words, 'Fire John.'"

This is a sage piece of advice for any radio advertiser: if you don't want your prospects to know you for something bad, don't reinforce the bad. Emphasize the good.

As Always,

Blaine Parker

A radio advertising Creative Director in Los Angeles for over a decade, Blaine Parker is a principal in Slow Burn Marketing LLC, a small and feisty marketing agency perched on a mountaintop outside Park City, UT. You can find out more about him at www.slowburnmarketing.com