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Tuesday, April 10, 2012
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Pandora and Radio - the Difference

Radio Ink hit the hornet's nest with its interview of William Feinstein. He's the New Jersey auto dealer who signed a year's commitment with Pandora, based on its accountability and the appearance that Pandora was more caring about his company than radio industry account reps were.

I count three radio writers pointing to this today, adding to my observation - written last Friday - that this is a must listen interview. You might take this as a message that it warrants ten minutes of your time.

Though newsworthy, this item does not come without warning.

"While radio industry executives were bad mouthing the new competition, the new competition was showing advertisers exactly how it could enhance response." Around mid-July 2010, I noticed that Pandora was running daily help wanted ads in the tech-centric online newsletter IAB Smartbrief. "IAB" stands for "Interactive Advertising Bureau." These help wanted ads continued through February 2011, and I wrote around that time that the broadcast radio industry had better be ready.

Hearing what Mr. Feinstein has to say, it appears radio execs didn't take notice then, nor cared too much about Pandora beefing up its local sales and data management departments.

As recently as April 3 2012, these two ads appeared in IAB Smartbrief, too: 1) "Performance Advertising Mobile/Web Account Executive - Oakland, CA," and 2) "Advertising Business Development Manager." Yes, they are both from Pandora, proving it's not through with its attempt at making a promise come true - that this new radio company was coming after local broadcast advertisers.

Instead of heeding the warnings and creating its own solutions to digital marketing for radio, industry executives began this bashing of Pandora. The exclamations were - and still are - laughable: "Pandora is not radio!" "Terrestrial radio reaches 93% of the population weekly" (which could be stated "weakly").

While radio industry executives were bad mouthing the new competition, the new competition was showing advertisers exactly how it could enhance response. Best, for the advertisers, was how Pandora was showing this through the use of hard numbers. There's no smoke and mirrors when you have data to back up claims.

So, as in the past, today we see the radio industry headlining its answer to Pandora's targeting ability with mention of "Zonecasting" through GEO Broadcast Solutions (a company that doesn't have a functional web site). And, where else would this story be highlighted but in the Clear Channel-owned Inside Radio: "Breakthrough technology poised to let radio carve out local zones with their signal." (RAIN had more on this yesterday.)

Here's the reality: If the radio industry puts faith in the ability of this type of targeting at the expense of fine-tuning its online targeting and accountability, advertiser apathy shown over the past few years will look pale compared to what's ahead.

Radio has this tendency to react, rather than take action. It stems from radio industry executives' hubris, which prevents them from acknowledging a competitive situation. Use nearly anything digital as an example.

As Pandora was ramping-up its local sales staff, hiring mostly people with radio sales experience (read: "contacts"), broadcasters spent all their time defining themselves as the only true "radio." We've most recently seen this at All Access, where Mary Beth Garber (again) spends enormous energy trying to dismantle a Pandora report.

All that's needed for countering her claims is to point to the Radio Ink interview of William Feinstein, and urge you to listen. As stated on Friday, here at AG: "IMO this is much more important than any presentation at a radio industry convention."

As for the difference between Pandora and the radio industry? The only people who are seeing any are those who are trying to defend an antiquated system for delivering audio entertainment, music, news, and advertising. Everyone else sees no difference, except in the attitude of those who represent the old camp and the new.

As Mr. Feinstein points out, radio doesn't seem to show anything close to concern for his ROI. Pandora cares about results.

Accountability in advertising tends to reinforce that image for digital, as it will for thousands of advertisers who will be exposed to it in the very near future - through Pandora, or any of the dozens of radio's new competitors - now approaching one of your advertisers, too.

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