Is Traffic Compensation Flat, Coming Out of An Adjustment Phase Or About To Emerge From The Cocoon?

Jobs and wages are a hot topic these days. Recently, we learned that only 96,000 jobs had been added in our Nation in August and unemployment stood at 8.1 percent, down from 8.3 percent largely because of 368,000 people leaving the workforce altogether. 

In 2009, we heard a lot about downsizing departments, furloughs, freezing salaries and less attractive benefit packages. The declining job market and downward trend of salaries in the Traffic Management profession have me doubly concerned. While these trends can be blamed to a degree on our current economy, the repercussions to our profession just might be profound. 

So, my intentions in writing this article is to paint a picture of what has happened to those working in Traffic in the last eight years. Since the TDGA Survey Salaries are the only real effort to measure the health of the Traffic profession, I spent most of my time dissecting surveys from past years. If you don’t know about these surveys, they are a great resource packed with data including: salaries broken down in various ways, increases and decreases in workforce, workload statistics and job satisfaction results. There is so much data in fact, that I had to make decisions on which direction to go. 

To really drill down into this information in a clear and simple way, I will focus my attention on Traffic Managers working in Commercial Radio for this first article. Then I can expand in future articles into the significant differences of Traffic in TV, Public Radio as well as how Hubs and Spokes, HD Radio and HDTV play into the mix.

You should know however that even though there are slight variances in the numbers between all the variables, the overall trends are consistent. No matter what your title is, what form of radio station you work for or which market you work in, for most, more work has been added with virtually no increase in pay. 

I would imagine that while employees may have been understanding when the economy was in the tank, as it recovers they expect their situations to recover as well. Restoring salaries to their pre-recession levels matters almost as much as how you announced the cuts. Looking at the data, broadcasters have some catching up to do. 

 

 The average (that’s coast to coast) salary for a Commercial Radio Traffic Manager this year is $43,285. That in itself is sad, considering the importance of this job. If you care to test the importance of the duties performed by a Traffic Manager, have everyone stay home tomorrow and let’s see which absence will affect you most. Anyway, $43,285. From 2004 to 2008 (pre-recession) the average increase in pay year over year was 2.75%. From 2008 to present, that already low increase plummeted to 1.125% year over year. 

The year over year average US median pay increase over the last eight years is 3.3%. The year over year average median pay increase for Traffic Managers over the last eight years was 1.8%. If 3.3% had been paid year over year, the average salary would be sitting at $48,369 for a Commercial Radio Traffic Manager. With the current salary at $43,285, that’s a little over $5,000 a year you are missing out on. For some, that’s a years worth of car payments. And insurance.

The last point is the most important. Yes, raises are given for good performance, but mostly raises are given to keep everyone on track with boosts in cost of living. Inflation. 

2004 to 2012 saw 22% inflation, which means on average, the salary should be at $45,513 just to have the quality of life you had in 2004. $45,513. Remember the average is $43,285. 

CEO’s and upper management have interesting clauses built into their contracts. Clauses like “any such annual increase shall not be less than the greater of 3% or a cost of living increase based on a consumer price index.” When you make $300,000 to $500,000 a year, are you really struggling to keep up with the cost of living? Traffic Managers are often on the low end of the pay scale and are not eligible for commission. Yet, they are responsible for the bottom line. If anyone is struggling with keeping up with cost of living increases, it’s Traffic. Who is looking out for these people?

The next area I wanted to focus in on is the increase in workload. As you can see in the below graph, in 2005, Traffic Managers were at a manageable average of 2 logs per person. I use the word manageable cautiously. The work of a Traffic Manager has always been stressful, never ending and mind numbing. Look where we are today though. Almost 5 logs per person. A 215% increase in work. And no reward.

 

What happened? First, radio saw substantial staffing reductions in 2009 as an effort to cover debt service that were exacerbated by reduced cash flow from dwindling advertising revenues. While I do not have data on how many people in Traffic were let go, I can without hesitation say it was at least a third.

Secondly, we must factor in that there are now more things to Traffic. Web Banners. Streaming. In most cases,  a ‘Interactive staff’ is not hired and the responsibility is thrown upon Traffic.  

The good news: Staffs have been cut to the quick. There simply is no more room to trim. 

The bad news: 2009 provided a good reason to make cuts. I don’t expect things to change in the near future because employers will fall into the notion that they can ‘get by’ with less. 

So that brings us to job satisfaction. Im sure it comes as no surprise that the level of happiness at work is dwindling. 

 

I don’t really have anything to add to this. It is clear that the recent economic downturn has had an adverse impact on morale. Probably productivity as well.

Where are we going?

Will these problems go away as radio rebounds? Will radio rebound? Could conditions continue to erode in the next eight years due to changes in technology or maybe even foreign competition? 

I don’t know the answer to any of these questions. I do know that it’s important to be aware of your surroundings though. I know feeling like you aren’t thriving is a dull, weighed-down feeling. It’s easy to become complacent and comfortable sometimes when there is so much uncertainty around us, but it’s important to check in and scan the internal and external environments to see what is happening in our industry.

If you hunkered down the past few years, you achieved quite a bit. You’ve shown your value and that should help your case when the company can start rewarding employees. If it’s been a while, it’s time. There are solutions out there. Ways to reward Traffic Managers for improving the bottom line. Like employees, employers can also become complacent and comfortable. Unwilling to change. If you find that things stay status quo, with no sign of recognition, increase in pay or a even a bonus, then it could be time to start looking for a new job.

 

Glosing the Gap on Discrepancies … part 2

“Great things are not done by impulse, but by a series of small things brought together.”

~ Vincent Van Gogh

Most important goals in life require discipline,     repetitiveness and consistency. A youngster, developing good study skills. A couple, saving enough for that first home. Anyone trying to lose weight or get in shape. By not doing the work, cutting corners or being inconsistent, one finds themselves with a lower grade, not enough to buy that home or weight gain.

Discipline, repetitiveness and consistency are also needed to prevent discrepancies in the Traffic Department. From order entry to broadcast, the “Life of a Spot” journeys to many different areas along the way. Has your organization mapped this journey? Have you looked at each turn in every process to safeguard against potential pitfalls, resulting in lost revenue? Not only lost revenue, but lost inventory as well in the form of makegoods.

Standard operating procedures…  Best practices. It doesn’t really matter what you call it, as long as it is written down and followed consistently. Everyone does the task the same way every time, with the goal of achieving uniform results. By creating a structured process, you can prevent major discrepancies from occurring and close the gap on the unavoidable ones.

Know thy Traffic software

It’s important while creating this structured process, to take some time to really learn the software that you use every day. This small upfront investment will have huge time payoffs in the long run. Software developers have been busy in the past couple of years creating new tools and automating processes. Anything that can be automated, should be looked at closely as managing systems is much easier than managing people. At each turn in the process, it needs to be decided if the current way is the safest most efficient way to perform the task or if the software offers an undiscovered better way. 

Map it … write it down

It begins at the beginning. Start with following the spot. So, what’s the first thing that happens? The order is input into a Traffic system. Who does it and what check & balance is in place to ensure that it was entered correctly? Does the software offer a functionality to confirm that the order was entered correctly? Does the software offer a way to check-in on the contract from time to time to make sure that all spots are placing where they should?

As you continue to follow the life of the spot, you come across each process … and there are many. How do you ensure that advertisers are receiving adequate time separation? Adequate competitive separation? How does the spot migrate to the Production Department? And how do you confirm that the Production Director actually assigned the correct audio to the correct cart number? What happens when you reconcile the log? Who is in the loop as to what happened the previous day? And what steps are taken to prevent a mis-step from happening again? What about reports? Who pulls which reports and when? Is it consistent? Can it be automated? 

Consistency … the hardest part

It’s a process … not an event. It requires practice. Like a muscle, the more you work on developing it and using it, the stronger it will become. The moment you take your eye off the process or begin to cut corners … that’s when something is going to fall through the cracks, resulting in a discrepancy. So again, discipline, repetitiveness and consistency are the most important factors.

As you move along, the process needs to be reviewed from time to time. When a spot misses, it’s important to understand where in the lifecycle the break-down occurred. More importantly is zoning in on that area, and making a change so that the error does not repeat itself. Everyone needs to be on the same page for this to happen. No one needs to place blame, but accountability needs to be present.

Reward

For all the bosses out there, here’s an idea I wrote about in my first article about Closing the Gap on Discrepancies. Why wouldn’t you adopt this?

When an organization sets their goal at 98% or 99% or 99.5% discrepancy free, then what they are really saying is, we understand that human error happens and we are comfortable with losing that much revenue.

The work of a Traffic Manager is stressful, never ending and mind numbing. Most often, they are on the low end of the pay scale and are not eligible for commission. Yet, they are responsible for the bottom line. To achieve all the above, it takes a lot of care and nurturing. Mostly, it takes engaged employees. So, if the station bills on average $7 Million dollars a year and the goal is 99%, that’s $70,000 that can be closed in on.

Wouldn’t all parties benefit by offering bonus incentives to close the gap on discrepancies? 

.1% of 7 000 000 = 7000 ($1,000 bonus) (station recoups $6,000) 

.5% of 7 000 000 = 35,000 ($5,000 bonus) (station recoups $30,000) 

1% of 7 000 000 = 70,000 ($10,000 bonus) (station recoups $60,000

Give a little. Get a lot. For salary level, that’s a big bonus. Dangle that carrot and I guarantee the over-all process will improve and strengthen.

Radio Startup … Lean Traffic

 “It is not the strongest species that survive, nor the most intelligent, but the   one most responsive to change.” Darwin

Several articles have popped up lately focusing on radio operating as a startup. One worth noting is Fred Jacob’s article ‘In Praise of Radio’.  Good ideas and philosophies can be found in his as well as other articles on the subject. The general take-way is if you are trying to disrupt the status quo and beat competitors that are bigger and better funded, you are not going to get there by playing their game or even the same game. You will need to think differently. You will need to operate differently. Operating at status quo when you’re at a disadvantage is a sure- fire way to lose. Talking differently however, opens new markets.

Yet, we see very little of this happening in our industry. Perhaps the hang-up is that broadcasters read about ideas like this, but are overwhelmed with how to get there. Balancing advantage, risk, and performance, is critical. In the beginning, its not about coming up with some great new innovation. It’s not about picking apart your product. It is about creating the pathway to get to a place where you can begin to create innovation and better products. Hiring and running at a status quo level will only bring about status quo results. Though I am passionate about Traffic and Traffic Departments, I feel that it is the very department, along with AR and HR that is the pathway to change.

Consider how many new broadcasting companies or stations pop up everyday. Already this year, more than 53 new or modified call signs in the US alone have been submitted with the FCC. Each time presenting the possibility of incorporating a startup mentality. Unfortunately, the trend is to build traditionally. Hire the same people with the same titles doing the same work, thus leaving yourself no competitive advantage.

What is your core? Isn’t it providing a good product and selling it well? That’s it. But radio continues to build little factories involving data entry, human resource, payroll, accounting and so on. Though these tasks are extremely important, they are not core. How your organization does Traffic doesn’t give you a competitive advantage. Instead of taking on all these tasks and increasing overhead, startup radio would concentrate on core and find solutions for the rest.

Process is sometimes put in place because one person did one thing once, sometimes literally years ago. Leaders should question process at every turn. Radio as a startup would consider whether tasks could be outsourced to consultants, outsourcing firms or free-lancers before hiring someone on staff. The value of outsourcing is to bring scale, speed and cost efficiency without the challenges of taking on full time employees, particularly technical staff. If a job could be written down it would go. Sales can’t be written down. It’s talent. What the airstaff does can’t be written down. Again it’s talent. Traffic, Accounting and HR can be written down.

By seeking out a consultant or outsourcing firm, cost reduction will be your biggest gain in the beginning, but many benefits beyond cost savings can be found including: staffing redundancy, assurance of best practices and continuity in procedures. Additionally, great things can happen when the right small group of people are focusing on one thing. Even a shot at innovation in the Traffic Department. While not as cost efficient, larger companies are achieving similar benefits, depending on location, by hubbing operations.

Because of consolidation, there are approximately 30% less Traffic Managers in the Radio Industry today compared to 5 years ago. The numbers are probably similar in HR and Accounting Departments across the country. Some have moved on to other industries. Some still unemployed. There are brilliantly talented Traffic Managers out there that would jump at the opportunity to stay home and provide Traffic Services in exchange for being able to be a stay at home mom. Or dad. Radio company pays less in salary, services stay the same.

Startups start with understanding that change is the only constant. To change what you are doing, you must first change within. More importantly, a top-down approach has to be in place. It starts with the CEO. The GM. The Program Director. These people have to be passionate about change by encouraging and supporting new ideas. They have to re-evaluate where they spend their money and ensure that time and budget is being spent on product innovation, service and training. Do this and you get to a place where creating better products and being more innovative becomes easier.

People want to build creatively together and not just be told what creative decisions have been made, now go do it. They want to move fast with impactful results. By running lean, you can hire better talent and pay them better. Pay them better – they’ll work harder for you.

Emergency Preparedness in the Traffic Department

Emergency preparedness is a big deal when you are a Traffic Manager in an earthquake prone environment. Even if you are not in an area susceptible to natural disaster, something as simple as a gas leak could require the evacuation of the premises for hours or even days. Computers still run, phones still work and infrastructure is unharmed but there is no access to any of it until whatever is keeping you out is resolved. Do you have a plan?

Business continuity planning minimizes the impact of certain circumstances by ensuring alternate processes are in place for key operational functions. Having a plan safeguards assets as well as an organization’s ability to achieve its mission, retain acceptable levels of productivity, customer service, and ultimately to stay in business. For Traffic, it’s all about getting the next days log out.

There are endless combinations created when all the software choices and workflow procedures within various organizations are factored in. It’s impossible to write a general how-to guide, but hopefully this article will serve as a guide or at least get you thinking about it. It should also be noted that a company wide business continuity plan is an enormous task. From team leaders to job functions to emergency supplies has to be considered. If your company does not have a plan, they should. Its the least expensive insurance any company can have. For now, we focus on Traffic.

Your plan should provide the ability to be able to get at needed applications and resources, even when access to your place of work is not possible. Servers, applications and databases are no good if you can’t get to them. Access should also be available when the office is no longer functional and the server infrastructure has been moved elsewhere.

A business process flow chart for the Traffic Department should be created, reviewed and updated often. Identify critical operations. In this case, getting the next days log out. Consider if you can perform tasks from a different location or from your home. Are there other markets in your organization that can be leveraged to build redundancy and hedge risks.

Start with the easy stuff, such as a call tree and login information. The trick is to be redundant. Store a second or third copy of the documents at an off- site location. Another option is a password-protected page on the company website as well as access to email. Also, create a contact list for existing critical business contractors. In crisis mode, it will be very beneficial to have contact information for your traffic software provider or automation software provider.

Over a decade ago, when I was still using disk based software, I would actually make copies of the next days log and take it home or email the traffic file to myself. Luckily, we now live in an age where traffic software vendors offer web based software. Web based traffic software offers flexible access and automatically cuts half the work and half the risk out in the event of an emergency. If you are using web based software, then it’s possible to work from anywhere as long as you have internet connectivity. Sales or the Traffic Manager could continue entering orders. The next days log could be organized. Copy could be built. Essentially, business as usual, just working from another location. If you are not on web based software, whats your plan? Do you have a way to access that information or are you at risk?

Automation can be a problem. Who sends the final logs to automation? While you may have access to your traffic software from home, can you get to automation to actually send the log? There are work-arounds by using products such as GoToMyPc or having VPN access. A virtual private network (VPN) is used by a number of organizations in their attempt to allow remote users to connect to the corporate network. Additionally, it’s certainly worth reaching out to your vendors and exploring if they offer off-site backup or support that includes remote access.

There are also a couple of daily workflow procedures that can mitigate risk. I’ve known Traffic Managers that work commercial logs 2 months out. Others that work day to day. Working logs in advance not only provides a clearer vision of inventory, but also protects against last minute chaos should an emergency arise. There may not be time to place bumped spots back on the log, resulting in lost revenue. I suggest having logs worked at least two weeks in advance. While this may require some additional time upfront, you’ll find comfort in knowing its taken care of. Another daily workflow procedure that may prove beneficial is creating an archived trial log. Do it first thing in the morning. This could be as simple as emailing yourself a pdf of the next days printed log. While you may not have an actual log file, you will have a structure to build upon.

Lastly, a structured walkthrough test should take place. Does the system you have in place really work? What ran smooth and what needs to change? Evaluate the process at each phase and make adjustments where needed.

Creating a plan that allows your organization to stand up against disruption is a gradual process. It’s not going to be perfect right from the box. Most of what I covered here can be accomplished in a weeks time, but realize it’s not just a project, but a long term goal.

Thoughts on What Makes a Great Traffic Manager

I once had an account manager say to me, “your job is so easy, a monkey could do it”. To say the least, the comment was hurtful, but for context purposes, her words were a back handed compliment as she thought I would be better suited in the sales department. In other words, she thought my talents were going to waste. I did however challenge her to come and spend a full day working an oversold commercial log with $500 average unite rate spots. She never took me up on that offer.

While this was a temporary personal surface wound, the industry views on what a Traffic Manager does goes a bit deeper. How is it that the position that offers the most value to a station is the most under-valued? The Traffic Manager is the most under-appreciated, over-worked and misunderstood resource at any radio/tv station. It’s hard work. Tedious. Repetitive. And process driven. It’s a brain-numbing job that involves methodically arranging (like a puzzle) 300-400 elements daily. Many have been asked to become more efficient with cut staff. To take on new responsibilities in trafficking new and ever changing digital platforms. To hit daily deadlines and be error free. And for some … oh yeah, could you also handle billing and answer the phone. Where else in your organization do you find this much value? Because of the high demand needed, yet low rewards given, smart and able in house talent simply consider other areas of the industry or other industries period. If not careful, the result could mean far fewer talented traffic people in a talent pool that is critical in broadcasting operations.

There is no Traffic Manager school. No traffic manual. It’s a learn on the go position which tolerates little room for error. 

Great Traffic Managers are detail oriented individuals that work well independently. Because traffic involves so many different elements – from scheduling to revenue management to billing – a great Traffic Manager must be highly organized and have a keen eye for detail. Being detailed oriented means you spot inconsistencies. That you notice an end date entered as 2017, should have been 2011. A web designer can have basic knowledge, poor attention to detail and still get by. The result might be a misspelled word on the “About Us” page or an incorrect phone number on the “Contact Us” page. If a Traffic Manager has  basic knowledge and poor attention to detail, the results can be significant in the way of lost revenue or un-balanced books. This quality can’t be instilled in someone. You have it or you don’t.  The difference between good and great is attention to detail. 

Great Traffic Managers love digging into numbers and spotting potential issues. They are analytical. By looking at numerical comparisons and key indicators, a Traffic Manager should be able to make observations and thus decisions based on those observations. These skills are most apparent in inventory & metrics reports. When you deal with multiple avail types, categories and lengths, you need to know what’s doing well and what isn’t doing well. Inventory is your show room floor, the stock room and whatever is on the truck or boat. Mismanagement leads to missed budgets. I’ve met Sales Managers that didn’t know how to read inventory reports. What would happen if your Traffic Manager wasn’t analytical?

Great Traffic Managers are good at process … or better yet… good at applying process. Consistent and routine. They are the ones that look at existing processes critically to make them faster, more efficient, more effective, or otherwise better. They are the ones that take great care to document their assignments because they will otherwise find themselves the target for blame when something goes wrong.

A great Traffic manager must be able to act positively and efficiently under pressure. The job is stressful. And thankless. It’s the bottom line. When everyone else cuts out for happy hour at 4PM on a Friday, they have to stay and get the job done. Deadlines are broken all the time. It’s not fair, but it is business. There is a wide range of attitudes on this point, but the great Traffic Managers  see time spent bickering could be time spent hitting budget. 

Lastly, and maybe most importantly, great Traffic Managers evolve. The Traffic landscape is changing. There are new platforms and with them comes new terminology and ways of working. While one views added digital duties as a burden, a great Traffic Manager sees it as opportunity. They focus on transferable skills irrespective of immediate reward and recognition. They interact with and push their traffic software vendors for more efficient tools. Traffic systems have made great advancements in the last decade, but they are only as efficient as the Traffic Manager managing it. GreatTraffic Managers can evolve the stations’s traffic system to meet its ever-changing needs by proactively seeking new processes that allow it to be as effective as possible. As Traffic evolves to ad ops and as our digital platforms become more complex and show higher returns, the industry will come to realize the importance of understanding what Traffic does. But to get there, a new breed of Traffic Managers is needed and they will need some additional technical and interpersonal skills. 

how to help …

To quote Ben Horowitz, co-founder, Andresseen Horowitz, “If you have never done the job, how do you know what you want”? It would do you and your organization well to sit down and spend a day in the Traffic Department. It’s an opportunity to see first hand what really works and identify if and how certain processes can be improved. 

Keep the Traffic Department separate from Sales. Traffic Managers are generally analytical and technical people. Sales people and sales managers  are generally expressive and outgoing. Each personality type is what it has to be. Separating the two will not disturb any synergy that may be in place. If they are required to be at sales meetings, keep that in place. What the separation offers is a safer environment to express concerns or frustrations. 

A quiet place to work. If your Traffic Manager is in a cubicle on the sales floor and there are un-occupied offices (or folks in offices that require little concentration) … there are probably some resentful feelings going on. Think about building the commercial clocks. The traffic system doesn’t just do this. It requires meticulous effort, planning and concentration in making sure all the elements fall exactly where they are suppose to. Otherwise, the exported log won’t match up with the automation system and commercials will drop. Traffic Managers look at a ton of data in one day. One missed number or decimal point can come back in discrepancies. For this alone, it merits being able to close a door to think.

Involve your Traffic Manager in what’s happening. Don’t let them be the last to know things that directly impact their workflow. Involve them. Assign projects or Invite them to attend  task-force meetings. And lastly, nurture the relationship. It’s a hard job. An important one. If nobody showed up at your station tomorrow, I can make a pretty good case that Traffic would be the most impactful on your day and bottom line.  

Coming soon … ‘The New Traffic Managers … who they are and what makes them great’

What happened to contextual advertising?

In January of 2010, Clear Channel Radio announced the ability to automatically and reliably insert any length of audio spot immediately after specific programming or commercial spots based entirely on content. This is known as contextual or semantic advertising. It was announced that several test campaigns for major national advertisers VISA, GEICO and Wal-Mart, produced outstanding results for the advertisers. And then, as quickly as this exciting technology appeared … it seems to have disappeared. As a Traffic Manager, I was fascinated with this innovation and have continued to research the topic, but there’s nothing out there beyond the launching press releases. What happened? Where did it go? Perhaps Clear channel is still using this technology, but if so, why are there not more conversations about it and why are other radio companies not jumping on this innovative idea?

So what is it? Traditionally, contextual advertising is a form of targeted advertising in which the content of an ad is in direct correlation to the content of the web page the user is viewing. For example, if you are visiting a website concerning traveling in Europe and see an ad pop up offering a special price on a flight to Italy, that’s contextual advertising. If you use Gmail, you’ll see this at work all the time.  The ads served are usually related to the contents of the email. 

Several ways this technology can be utilized by radio companies. First is through on air dialogue. Maybe your morning show is talking about coffee and how they need it to keep themselves going during their early morning shift. What a perfect time for a Starbucks ad to air. Top of mind and relevant to the conversation. 

Through using contextual advertising, it’s also possible for advertisers to target industries they would like to be associated with. Spot following spot. In one of the initial test campaigns, Clear Channel took the ad theme a step further by placing GEICO’s :15 radio spots immediately after ads from auto, motorcycle and other vehicle makers. So, for example, a Ford ad would be followed by a GEICO ad. Endless options here: phone makers following phone services, any food product following grocery stores or shoe maker following department store.

Another area in which contextual advertising can land a starring role is in on air content. Just browsing through the top 10 songs on this weeks Billboard Hot 100, 4 of the top 10 songs have product placement in the lyrics. So if you are a Top 40 or hot ac station, it’s likely that roughly 40% of the content you are airing has product placement built in. That’s a prime candidate for contextual advertising. Play hip hop? You’ve hit the lottery with artists chronicling their high-rollin’ lifestyles. And this technology can be used within any format, though some will need deeper monitoring than others. 

Also among initial test campaigns, Clear Channel’s service ran a Walmart commercial for the ACDC ”Black Ice” CD. But, instead of using only demographic targeting, Clear Channel ran the ad immediately after the same ACDC song on FM stations across 91 markets. So, in this case, Clear Channel used musical context as the cue to pair contextually relevant ads.

Lastly, contextual advertising can work for a radio station in which its origins began … the web page. Let’s say a listener is streaming your station when Travie McCoy featuring Bruno Mars’s Billionaire plays. In this song, Bruno sings, “I wanna be on the cover of forbes magazine”. Wouldn’t it be brilliant if the banner ad on your web page and streaming player could automatically serve a Forbes Magazine ad? 

Yes, there are potential pitfalls in the world of contextual advertising. A funeral service company running a spot associated with a story of someone dying would not be good. It happens, but usually from poor execution or very wide scoped projects. Spoken word stations would be most susceptible to these mishaps.  Although contextual advertising has attracted some controversy through the use of targeting, radio station use would not fall under behavioral targeting. There is no tracking involved. It is after all the station pushing the content, not the listener or web page viewer. 

Contextual advertising has made a major impact on earnings of many websites and it’s clear that radio is leaving money on the table by not implementing this technology. Everyone benefits. Contextual ads will show up in spots highly appropriate to its content, thus driving the likelihood of a positive response for listeners. More likely to be clicked or acted upon which is beneficial to your clients. Sold at a premium thus generating additional revenue for the radio station. Contextual advertising is a win/win/win and should be shaping our industry to better address advertising content that is relevant to the content of the radio station. 

Those 4 songs ….

Party Rock Anthem by LMFAO Featuring Lauren Bennett & GoonRock (product = drano)

Lighters by Bad Meets Evil Featuring Bruno Mars (products = audi, aston & mtv)

Super Bass by Nicki Minaj  (product = polo)

Cheers (Drink To That) by Rihanna  (products = jameson & ray-ban)

 

The case for outsourced (private) hubbing

I recently sat in on a roundtable forum discussing traffic hubbing. A majority of the companies present were from the TV industry and currently operating under a hub model. Very interesting. Lots of insight to be had. There were two key take-aways from that forum that I would like to share with you. First, a lot of the new hires are not experienced Traffic Managers. They are finding new skill sets and better service providers in employees that come from other industries such as accounting and data entry. Second … they are thriving and happy with their decision to change.

It’s a smart business decision and frankly it’s surprising that it has taken until now for companies to change the way they operate. As expressed in the forum, the transition will be difficult. Change is difficult. Tough decision will have to be made about the future of not only people, but the way processes are handled. But the reward is opportunity.  An opportunity to transform the management of non-core processes and become more progressive, more collaborative and more flexible. This should be a concern for you because these companies have now gained a competitive advantage on you. They have realized an opportunity to work smarter and utilize savings in more productive ways. This could be hiring more sales people, top notch on air talent or investing more in digital technology. All things that are core and add value to your organization.

These companies are larger however. Perhaps the internal hubbing model works just fine if you have 25, 50 or 100+ stations. Larger companies can make it work because they have enough stations and people to scale it.

But what if you only have 15 stations? Or 5? At this level, there really is no room to scale and gain efficiencies or reduce costs. So how do smaller companies keep up and level the playing field? We believe the solution is in outsourced (private) traffic management.

Radio companies need to focus on what made them successful in the first place – the core business. Expending valuable time and energy managing transactions and non-core processes that could be handled by other specialist is not productive. For smaller groups looking for strategies to enhance their financial condition, greater economies of scale can be achieved through collaboration, shared services, or outsourcing.

It can be a scary word for business owners. It can conjure up images of losing control or a degradation in operations.  In reality, the opposite is normally true. With outsourcing, there are contracts, reports, and personal contacts that can keep you informed of performance. And like any other business relationship, it’s not about being the biggest or cheapest … it is about reliability and trustworthiness.

Outsourcing has succeeded because of its ability to reduce risk, drive standardization, increase productivity, and improve reliability and predictability. In other words, its ability to industrialize an ever-increasing range of business activities.

  • Hubbing allows for cost reduction. Outsourcing provides even deeper savings, while retaining a larger workforce.

  • Both models drive operational efficiency. Outsourcing however, also allows for an increase in resource flexibility and access to talent without payroll burden.

  • Additionally, outsourcing presents an opportunity to access new technology and possible strategic partnerships that allow penetration into other markets. Maybe even foreign markets.

The role of the Traffic Manager is rapidly evolving. You not only have traditional advertising to execute, but now digital and mobile. Do you have the time, budget and resources to keep your traffic department up to level in training and development? It’s not just about scheduling spots anymore, but helping execution, customer service and business direction.

Hiring the right small number of people … together … only doing several things, but doing them great is key in driving your business and staying competitive. Why not partner with a company that offers deep domain knowledge in services that are core to your business … but not your core business? A company that can provide additional savings and additional employees. A company that emphasis on formal process and quantitative performance measures. A company that can dedicate 10% of their budget to the training and follow-up of employees. A company that becomes an extension of your team and is willing to customize your needs. Reliable and trustworthy.

If it can improve profitability and keep the same or better level of quality standards …. why not do it?