I had been planning for a while to write a research-based article, but then I came to the conclusion that instead of me offering thoughts as someone who implements research, why not just talk to someone who actually gathers the stuff.
ByrnesMedia has worked closely over the past few years with Larry Campbell of Campbell Media Research out of Seattle. When I approached Larry to be part of a written interview, I was delighted to find out he was more than happy to do so. Here, then, is the first part of “10 Questions with a Research Guy.”
1. Larry, give us a rundown on the many radio hats you’ve worn over the years.
I was General Manager of radio stations in Spokane, Washington (market rank 94); Portland, Oregon (market rank 23) and Seattle (market rank 13). The information and knowledge I gained from doing market research projects led to the development of strategic marketing plans to eliminate our stations’ weaknesses, and exploit the weaknesses of primary competitors, to significantly increase the ratings and profitability of the stations. This success led to my being moved on to the next larger market.
While I was in Seattle, I was given the opportunity to become President of The Research Group; a radio market research firm I had used to help me and the management teams I worked with understand listener perceptions of the strengths and vulnerabilities of our station, and of our primary competitors. I managed The Research Group from 1980 through 2000. We provided market research and strategic planning services to 350 clients in the US, Canada and throughout Europe.
While managing The Research Group, with two colleagues/partners, we acquired two radio stations, an AM and FM in Seattle. We used market research and strategic planning to improve the ratings of the AM station, and make the FM station (which had ratings so low it didn’t qualify to be listed in the Seattle-Tacoma Arbitron surveys when we bought it) achieve excellent ratings, revenues and cash flow before we sold the stations. It was a terrific investment for us.
Since 2000 I’ve been president of Campbell Media Research, Inc. As you know, we provide market research and advanced strategic guidance to clients in the US, Canada and Europe. Our goal is to help our clients achieve great success and defend their success over the long run.
2. Research doesn’t come cheaply, so how do you explain to present and potential clients the long term cost benefit of conducting a survey?
Frequently we’re contacted by potential clients who are having difficulty achieving success with one or more of their stations. They’ve tried different things to help improve ratings, but they haven’t been able to succeed. They know if they could just improve their ratings they would be able to increase their rates, grow their local and national revenue, and substantially improve their station’s cash flow. They recognize they need help.
So rarely do we find ourselves faced with discussing the cost of “conducting a survey” on a price and item basis. We don’t sell research projects. We sell success based on the experience and knowledge we’ve gained working with many hundreds of clients over the years, plus our proven track record helping clients achieve higher ratings, increased revenue and cash flow through our system of market research and strategic planning.
The more successful our clients become, the more their competitors will work to take their success away from them, so market research and strategic planning for our clients is not about “conducting a survey.” It’s about committing to a system of strategic management of the station or stations, using input from target listeners to provide the road map for success. It is invaluable for managers and programmers to know what target listeners want in a format, and ongoing market research helps them fine tune as target listeners’ tastes evolve.
We explain the cost benefit of working with us in terms of the client’s or potential client’s return on investment. By analyzing the station’s performance in its primary target demographic group over several BBM surveys, and comparing its performance with the performance norms for very successful, market leading stations in the same format, we can develop a general understanding of the growth potential for the station. We ask the client or potential client, “What’s the total annual revenue value of one additional percentage point of BBM share in your station’s target demographic group?” The answer is always a sizable amount of revenue. The potential for improved ratings, leading to increased revenue and cash flow experienced by our clients makes the cost of “conducting a survey” minimal, relative to the station’s return on investment. And usually the growth potential for the station uncovered in our Strategic Market Studies is significantly higher than the estimates we make from the BBM analysis.
It’s interesting that less frequently we’re contacted by potential clients who are doing very well and enjoying great success in the BBM ratings, but they’re not really sure why they’re so successful. They know very clearly the value of a lost percentage point or more of BBM share measured in terms of lost annual revenue and cash flow. Their objective is to learn what makes them so successful and how to defend their success.
3. Focus Groups are one of the less expensive forms of research. What are the benefits and potential pitfalls of such studies?
Focus groups are typically small discussion groups of 10-12 people led by an experience moderator. In radio research, focus groups are usually comprised of respondents screened to be representative of a particular group of listeners, such as women 25-44 who prefer to listen to the station’s weekday morning show the most, or men 18-34 who prefer to listen to the station’s music the most. Focus groups are a form of qualitative, not quantitative market research.
The primary benefit of focus groups is they can provide quick insight into feelings, beliefs and experiences that can indicate how listeners in the larger group they represent might react (not would react) to the issues being discussed.
The disadvantage of focus groups is that they don’t provide definitive answers that can be extrapolated to the larger group they represent. The major pitfall of focus groups is that sometimes they are used as a statistically reliable technique for determining a particular group of listener’s authentic point of view and for decision making, which is dangerous in that it can lead to major marketing mistakes being made by the station’s management team.
A research firm’s focus group report should not present findings in terms of frequencies or statistics because this may cause readers to believe the percentages or frequencies are true for the wider group of listeners the focus group participants represent, which they are not.
We find the best uses for focus groups fall into two areas. First, to discuss specific questions (hypotheses) concerning the radio station’s programming, positioning and advertising with specific groups of its listeners such as its partisan listeners, morning show partisans, etc. The objective is to learn issues of concern that can be further investigated in a quantitative telephone study with a sample of 400 or 500 respondents. A quantitative study of this type with an appropriately sized sample provides data that can be generalized to the population of radio listeners they represent with mathematical precision.
Second, focus groups are a good way to pre-test advertising concepts for the station before they are produced and put to work in the form of television commercials, billboards, bus signs, etc. A series of focus groups with target listeners where the advertising concepts are evaluated against alternative approaches can lead to patterns formed by words, from group to group, which represent themes or perspectives. Using these themes or perspectives can help the station increase the effectiveness of its advertising by getting rid of concerns that are objectionable to respondents across several focus groups and further improve the effectiveness of the advertising concepts by including improvements suggested by the respondents across several groups.
4. Moving on to full Perceptual Surveys, explain to us what they are, what they can provide a client, and give us an example or two of these types of studies you’ve conducted and what the outcome was?
We call our “full Perceptual Surveys” Strategic Market Studies. We provide different types of Strategic Market Studies.
The Strategic Market Study – Format Search Project is for clients who wish to investigate possibly changing or modifying formats. We’ve developed a proprietary series of format susceptibility questions that accurately and reliably gauge the cume and share potential of various formats our client wants us to consider. We have found format opportunities that have led our clients to huge ratings and cash flow success in many hundreds of markets large and small from Toronto, New York and Berlin, to Barrie, St. Catharines – Niagara and Kalamazoo.
The Strategic Market Tracking Study is used by the majority of our clients for their station’s or stations’ “annual physical examination.” Many things change over the course of a year, which can negatively impact a station. Competitors change format or adjust their music mix. Morning show teams and personalities come and go. Major contests take place, which at times make a significant positive change in a competitor’s ratings. Over the course of a year, frequent questions arise concerning what the client station or stations should do with respect to music mix, informational programming, personalities, positioning, contesting, and advertising, etc. The Strategic Market Tracking Study gives the station the opportunity to investigate all of the issues it is concerned about. In addition it gives us the opportunity to investigate all of the areas of concern we know must be asked to ascertain the station’s degree of health in the minds of its target listeners. The information and knowledge enables the station’s management team to take corrective action when “bad health” areas are uncovered before they lead to tuning out listeners and lower ratings in BBM’s surveys.
The studies provide a client with the knowledge required to develop the right strategic marketing plan to enable the station to reach its full potential in cume and share. We’re able to provide the station’s management team with detailed information about the nature of its format – whether it’s growing or declining in appeal, detailed information about its target listeners, what programming elements and station qualities are critically important to its target listeners and therefore to its success, and how its listeners “grade” its programming (“A,” “B,” “C,” “D,” or “F”), whether or not it has truly effective positioning, the degree to which the station is top of mind or suffers from “top of mind shortfall” with target listeners, and the effectiveness or lack of effectiveness of its advertising and contesting strategies.
I can cite many, many examples of clients having achieved great success from engaging us to conduct market research projects.
Perhaps the most profitable return on investment any client has realized from working with us is “106.7 Lite FM” in New York. We were asked by Viacom Inc. to conduct a study to find a new format for WKHK-FM “Kick 106.7.” At the time “Kick 106.7” was competing with “1050 WHN” in the country format and had very low ratings because as we learned in the study, there weren’t many listeners in New York who liked country music.
Our study identified a sizable mainstream adult contemporary format opportunity for “Kick 106.7.” After our strategic planning meeting, Viacom Radio’s President and the station’s management team were eager to pursue the mainstream adult contemporary format opportunity, however, we were asked to return to New York and justify our recommendation to Viacom Inc.’s Board of Directors. The Viacom Board approved the format change during the meeting and “KICK 106.7” became “106.7 Lite FM.” Since the format change, the station’s ratings have been at or near the top of Arbitron’s New York Radio Ranker, which lists the 65 radio stations in New York with ratings sufficient to meet Arbitron’s minimum reporting criteria. In February 2012, “106.7 Lite FM’s” Arbitron Average Quarter Hour Share for Persons 6+, Mon-Sun 6AM-Mid was a first place 7.3% share, nearly equaling the 7.5% combined share of its three adult contemporary competitors – “Fresh 102.7,” “95.5 WPLJ” and “WALK 97.5.” BIA/Kelsey has listed “106.7 Lite FM” in the top 10 ranked stations in the U.S. by annual revenue with billings ranging from $40 to $50 million.
A good example of a Strategic Market Study – Format Search Project finding a high potential format where it was not at all obvious going into the design of the study, is the study we designed and conducted for CKMB-FM “Star 107.5” in Barrie, Ontario in April 2005. The station was launched in 2001 by Rock 95 Broadcasting Ltd., also the owners of CFJB-FM “Rock 95.” At that time “Star 107.5” was ranked 9th with adults 25-54 and 6th with women 25-54. In our study we investigated several formats and found a sizable opportunity for a Hot AC Format. “How could that be?” you might ask because at the time there were already two other adult contemporary stations in Barrie. They were Corus Communications’ “B101” CIQB-FM, programming a Hot AC Format and its sister station CHAY-FM “CHAY 93.1 FM” programming an AC Format.
This is an interesting example because it would not have been apparent to anyone investigating the market based only on the BBM ratings, listening to the stations, or their gut feeling, that there would be an opportunity for a Hot AC Format. However, in the study we learned the strengths and vulnerabilities of “Star 107.5,” and the vulnerabilities of our primary competitors.
From the information and knowledge gained from the study, we developed a step by step strategic marketing plan to change “Star 107.5’s” format to Hot AC and to attack its primary competitors by taking advantage of their vulnerabilities. The new “107.5 KOOL-FM’s” management team and their consultant Greg Diamond turned out to be “master class strategists.” They fully and effectively implemented every component of CKMB-FM’s strategic marketing plan, which enabled the new “107.5 KOOL-FM” to become and remain the top rated radio station with women 25-54. Over the last six BBM Surveys “107.5 KOOL-FM” averaged a 19% women 25-54 share and has been ranked first in its target demographic every survey except one, when it had a 20% women 25-54 share but was edged out by its sister station Rock 95 with its 21.9% share.
The CKMB-FM story is also a good example of a return on investment story because you can use your “mental calculator” to estimate the annual incremental revenue and cash flow that “107.5 KOOL-FM” has enjoyed selling the market leading station with women 25-54 compared to its 6th place women 25-54 share in 2005.
We’ll have to stop it there as we’ve run out of space.
We’ll have the remainder of this fascinating look at radio research in next month’s ByrnesMedia Newsletter.