The virtual Radio Show kicked off Monday with a “Town Hall” where the CEOs of radio’s three largest companies made the case that the industry has a towering opportunity in front of it: to emerge from the pandemic in better shape than before the health and economic crises first upended American life.
“The pandemic has provided us with an opportunity to get stronger and better,” Entercom CEO David Field said. “As we come out of this as a nation, the radio and audio industry is in a great position to thrive and to move ahead faster than we entered into this.”
The industry’s annual conference, convening for the first time online instead of face-to-face, got underway with a reflection on the important role the medium plays during a crisis, whether a tornado, hurricane or destructive flooding. Radio has traditionally “strengthened our relationship with the consumer” because Americans need information and “somebody to be there for me,” said iHeartMedia CEO Bob Pittman. But the coronavirus outbreak marks the first time that’s happened at a national level, which he said “will have a huge long term benefit for us.”
The industry’s biggest challenge right now is uncertainty about what’s to come, observed Cumulus CEO Mary Berner. “We’ve all got to be very focused on the generation and preservation of cash to build up liquidity and shore up our balance sheet,” she said.
Once the impact and gravity of the pandemic first became apparent in early spring, the three CEOs began getting together regularly on the phone to talk about ways to confront the challenges it posed to the entire industry. That included conversations with Nielsen about how to report radio listening data “in a way that was fair measurement at this time,” Berner explained.
Faster Decision Making
The pandemic also sped up decision making with Berner saying all the companies quickly made sometimes uncomfortable decisions “that would have [normally] taken months and months to make” but would be beneficial to the company in the long run. Among those was the realization that they didn’t need to maintain their existing real estate footprints in light of a reduced workforce and many employees working remotely. “It’s a different kind of leadership challenge but I think it’s made us stronger, all three of us as companies,” Berner said.
The pandemic’s massive disruption is causing radio to focus on how it wants to come out of the crisis. Among the questions Entercom focused on, Field said, are the best ways to enhance the listener experience and the customer experience and for employees to move forward. “Our companies have enormously powerful platforms of local and national celebrities, podcasting, digital audio platforms and so forth,” Field offered. “How do we harness that in a way to enable us to be vibrant, dynamic, growing organizations on the other side, with growing audiences and finally getting our fair share of the ad pie.”
The theme from the three power players is that periods of disruption like that of 2020 are also times of opportunity. “This is a time of disruption. That’s actually good for us,” Pittman argued. The rationale is that when things are good, advertisers don't want to rock the boat and try something new. But “down times are when they go, ‘OK, I’ll try it now,’” he explained. Cable networks benefitted from the economic downturn of 1987, digital gained ground with advertisers in the late 90s and social media took off as an ad platform in the Great Recession of 2008. “This time it’s audio,” Pittman posited, led by podcasting. “What advertisers are finding with audio,” he said, is that for “about the same weight level you get about the same results” as TV – for one-third the price. “In bad times, they need every penny to count so they’re using radio and they’re getting results,” Pittman went on. “As an industry, we don’t have a problem holding on to people who spend money on radio. We have a problem to get people to just try it.”
The silver lining in today’s distressed economic environment is that more marketers are giving radio a chance, along with its offshoot offerings like podcasting. “Nothing has the growth rate of podcasting,” Pittman argued. Radio companies have been the biggest beneficiaries because “it’s the same experience, it’s still companionship and it’s wildly host-driven, just like radio is.”
Yet despite all the upheaval, Berner made the case that the one constant has been radio’s ability to efficiently reach engaged audiences. With marketers increasingly looking for efficiency, scale, impact and flexibility, radio is in a stronger position than ever, she told the online audience on the Radio Show’s Channel A stream. “We’re big, we’re cheap and we work,” Berner said. “And that is a really good position to have right now in a market like this.”