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AG News:
Thursday - 7/29/2010
The King of "I Just Don't Get It"
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There are two types of people that I speak of in articles printed here: 1) those who use the internet effectively, and 2) those who lag behind the learning curve. There are far more laggers in the radio industry, so I concentrate on them.
My theory is that if laggers can be convinced to use digital approaches, radio will be better positioned for the future.
Some old style radio types will never have their eyes opened because they are too busy defending the past, or they dislike my approach. (I was never one to sugarcoat the truth.) Which brings me to the topic of today's discussion, a fellow who has positioned himself as an expert in radio research and constantly points to reasons why the radio industry should continue down the same path it's followed for decades. He runs Harker Research and has been posting comments at "Radio Insights" for a couple of years now.
I've found very little in the intellectual area when Richard Harker and his sidekick Glenda Shrader Bos give their "insights." Mostly what's printed there are rants about how new media "pundits" are wrong. The underlying theme in many of their articles is that digital growth is myth. I present as one piece of evidence comments posted there yesterday in an article titled "Why Big Radio Dogs Wag Short Tails."
Let's go over a couple of paragraphs from this to give you an idea of how far out-of-the loop these folks are. Quoting: "Remember the Long-Tail? It was the notion that in a connected Internet world, the tyranny of the majority would be overthrown, replaced by equality for all."
They continue: "Using Chris Anderson's 2006 book The Long-Tail: Why the Future of Business is Selling Less of More, proponents have argued that the growth of long-tail online radio would destroy commercial radio."
I'm not sure whether they read the book, but to put as its main theme what they describe is a complete misunderstanding of "Long Tail" thinking. I'm also not sure where they got the notion that "proponents have argued" it would destroy commercial radio. What has destroyed commercial radio is consolidation, and current radio industry executives' desire to avoid entering new media waters for over a decade.
The long tail refers to a reverse of the 80/20 rule, where 80% of your revenues come from 20% of your clients. Or 20% of your efforts will take 80% of your resources. Or 80% of the people claiming to be experts fool only 20% of the people. This 80/20 rule can be applied to a multitude of concepts, and it's only a yardstick - nothing more.
Richard Harker's comments are best summed up by Triton Media's Vice President of Strategy, Jim Kerr, in an observation at the article's end: "This is a gross misrepresentation of what the long tail is all about." I'll take it one step farther and refute Mr. Harker's argument by using his own words.
In paragraphs 9 & 10 of his article comes this pearl of wisdom: "At the recent New Music Seminar, it was revealed that of the 98,000 albums that sold at least one copy last year, only 2,058 sold 5,000 units, 1,319 sold 10,000 units, and only 85 sold 250,000 units."
He then states: "In other words, 98% of last year’s albums sold fewer than 5,000 copies."
Doh!
The concept of "long tail" marketing is exactly described in his light-bulb moment of "In other words, 98% of last year’s albums sold fewer than 5,000 copies." This is the long tail of marketing that's referred to in Chris Anderson's book, which I suggest that Richard Harker and Glenda Shrader Bos sit down and read. It's an excellent take on how, in this day of the internet, you miss out by only chasing what the masses want.
Emphasizing his misunderstanding of the internet world in another eye-opening paragraph explaining the success of Pandora, Harker states: "Rather than exploit the long-tail opportunities of personalized radio, Pandora has taken a very conservative approach, playing the hits. The service’s growth seems to suggest that users don’t miss long-tail songs."
If I may explain Pandora's success to Mr. Harker, it's not the one million songs offered which have created success for Pandora but that the songs can be sliced and diced in a way consumers want. "Choice" is Pandora's secret weapon. Connecting to the (largely) youthful audience being underserved by the broadcast radio industry is pushing Pandora to the top of the heap.
If you believe internet music delivery is not what the "pundits" say, just wait until internet radio connectivity for the masses arrives in the car.
Let's leave this commentary with one final paragraph pulled from the "Radio Insights" article: "Has the Internet proved that tight playlists are a liability? No. Should radio stations continue playing a tight list and ignore those complaints that you play the same songs over and over? Yes."
I'd like to see the research that's used to state this fact because a recent Audio Graphics/Borrell Associates survey of 1,032 internet radio listeners answering the question "Would you like it if your online radio station played fewer/more new artists?" pointed to a different answer - 55% want more new artists. And if we only include the demos 12-44, 73.6% want "more new artists."
For the radio industry: Find a way to serve the percentage of people looking for new artists and you are servicing the "long tail" of radio listeners.
Selling fewer albums to a much larger group of people is what the long tail is about. If Richard Harker had only reread his "98% of last year's albums sold fewer than 5,000 copies" again, this concept might have sunk in.
And had he read Chris Anderson's "The Long Tail..." without prejudice, he might have arrived at the same conclusion.
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