Gray Matters: Radio, boomers, trust and promos

  • Voices
  • November 23, 2018
  • Graham Medcalf
Gray Matters: Radio, boomers, trust and promos

RadioDEAD

Last week’s announcement that RadioLive will be merged with the Magic network in early 2019, with the new entity to be called Magic Talk was met by stunned disbelief. Former head of RadioLive, Mitch Harris, didn’t hold back when on his late night show he ranted about television people who didn't know anything about radio. So, the question arises, ‘Do MediaWorks bosses know what they are doing?’

Co-editor of Newsroom Mark Jennings was previously head of news at TV3, so we should take notice of his view when he writes that, “RadioLive has been a problem child of MediaWorks’ highly successful radio operation”.

“The hybrid of music and talk looks to be a way of easing the pain on the news department before Magic moves back to being a station aimed at male baby boomers with a penchant for easy listening formats,” says Jennings.

But what does that mean for advertisers? Marketers will be reluctant to part with money on a format that does not appear to have succeeded anywhere else in New Zealand, Australasia or indeed anywhere in the Western world.

Stations use formats to target audiences and advertisers,” advises the Balance Careers website: “When advertisers look to place commercials on the radio, they need to know whether a station is playing country music or hip-hop. That helps them decide how to pinpoint their message to reach a specific audience.”

Nowhere are there examples of a successful hybrid of music and talk. As one of the many ‘male baby boomers with a penchant for easy listening formats’ and a penchant for talk radio, I certainly want to know which one I’m going to get when I tune in. I’ll make the decision when to listen to music and when to listen to talk. I don’t want my talk radio interrupted with music, it’s annoying enough already to have the conversation interrupted with advertising.

In today’s world, it is all too easy to flick between stations and you won’t hold the attention of male baby boomers by throwing in an Eagles rendition of Hotel California in the middle of a talkback discussion about the MGTOW (men going their own way) movement in the age of #metoo. I like steak and I like ice cream but don’t serve them up on the same plate. It doesn’t work.

So, who is responsible for this madness? MediaWorks chief executive Michael Anderson appeared to be the conveyor of the bad news. Now Michael spent seven years as CEO of one of Australia's largest commercial radio groups Austereo, a period during which he led the company to improved revenues and audience share, so he certainly knows radio and is not one of the “television people who don’t know anything about radio,” that Mitch Harris was referring to.

In July 2011, Southern Cross Media and Austereo were merged to form Southern Cross Austereo. Neither its Hit Network nor its Triple M Network appear to have a station with a hybrid of music and talk format, so one can only believe that the announcement of Magic Talk is some smoke and mirrors while something else is going on.

Now rumours that, “The sale of MediaWorks, or at least some part of it, appears to be getting closer” as reported by Newsroom (Jennings should know) may be the reason for the drastic action being taken with the RadioLive problem child and could just be a cost saving exercise while preparing part or all of MediaWorks for sale.

In the meantime, advertisers will be thinking pretty hard about placing ads on a talk station that will be “run by the music radio side of our business".

Booming Market

While writing about MediaWorks’ attempt to satisfy the male baby boomer market, I got to thinking how this increasingly important market sector is consistently ignored by many marketers and advertisers (retirement village advertising aside).

This is not just a blind spot for New Zealand marketers. In an article from New Media and Marketing, the US-based website admits: “Marketers continue to prioritize youth despite Baby Boomers having a median income that’s more than twice as high as Millennials, a median net worth that’s more than 15 times higher, and an average monthly spend per household that’s more than 50 percent higher.” In fact, “people over 50 are responsible for over 50 percent of consumer spending in the US”.

There are many examples of this lack of interest in the Boomer market in New Zealand. It is far more appealing for the liquor industry for example to show young people lubricating their lives with some of the good stuff. But as Nielsen reveals in one of its insights, NZ boomers and Millennials think different, drink different. Collectively the two groups account for 58 percent of the drinking population.

Boomers account for 30.76 percent of the New Zealand population as opposed to Millennials at 25.68 percent. In a NZ Herald article in 2016 Chris Schultz, managing director of Senioragency, an advertising and marketing agency that specialises in reaching consumers aged 50-plus, revealed that boomers hold considerable buying power.

“Boomers are more than likely mortgage free, most have children who have left home, they're asset rich and are at the peak of their earning capacity. Of all the consumer segments, boomers have the highest disposable income; they account for more than 50 percent of all disposable income in New Zealand – more than the combined disposable incomes of Millennials, Gen Xers and retirees. In particular, they're big consumers of health and wellbeing, travel and lifestyle products.”

Is it that advertising agencies and marketing departments are devoid of anyone from the disposable generation with disposable incomes that has created this blind spot to a lucrative market? As the New Media and Marketing article so succinctly puts it: “People over 50 aren’t creative enough to write a banner ad, but they are creative enough to dominate in Nobels, Pulitzers, Oscars, and Emmys. I guarantee you, not one of these brilliantly talented people could get a job in an ad agency today. Not one.”

A Matter of Trust

I was fascinated this week to read that Advertising execs rank below politicians as Britain’s least-trusted profession. The Ipsos MORI Veracity Index is the longest-running poll on trust in professions in Britain, having been asked consistently since 1983.

The question is, who do you trust more? Simon Bridges or Simon Lendrum? Greg O’Connor or Greg Partington? Paul Goldsmith or Paul Catmur?

Agency folk spend their lives trying to build trust in the brands they have been given responsibility for by their trusting clients. New Zealand’s most trusted brands are proof of success in this regard but how successful are these brand-builders in building trust in themselves.

I was amused (and a little nostalgic) reading Damon Stapleton’s recent blog – Damon is chief creative officer of DDB New Zealand. In the blog on Campaign Brief,  he writes about the trust a client has to have in the person who is pitching. “For me, the pitch process is the best example of why the advertising business has always been and will always be about two very human building blocks. Trust and confidence.”

How do you think New Zealand advertising execs would rank against our politicians in terms of trust?

Retail Charity

Do you ever get the feeling that some retailers and some brands are always on sale or on promotion? I would never buy anything at Briscoes that the lovely Briscoes lady hadn’t told me was discounted between 40 and 60 percent. I only buy at Farmers on a Thursday – that’s sale day every week.

Well now we have proof that New Zealand grocery shoppers are the most promotion-driven in the world. In an article on Nielsen’s Insights, Brett Miller, Sales and Marketing Effectiveness Lead, Commercial Development, tells us: “Almost six in every ten dollars spent on groceries in 2017 were sold on promotion - well ahead of other developed markets around the globe.”

Brett asks the question: “Why do we promote? What are manufacturers and retailers trying to achieve? Are most promotions genuinely driving incremental sales, or wiping value from categories and potentially eroding brand health? Can the sector sustain such high levels of price promotion?”

The percentage of grocery products sold on promotion in New Zealand, at a staggering 59 percent, is more than twice that of the UK. And, “it’s estimated that the retail sales value of the discounts applied for promotions that generate little or no incremental sales is over $470 million".

Who are the idiots? Those that buy when goods are not on sale or those that sell at a discount when they could get full price. Any marketers like to comment?

Afterthought

Nothing annoys me much more than auto-play on websites or pop-up ads. So I was delighted to read in Forbes that, “Ethan Zuckerman, the man who invented pop-up ads, has apologised to the world in a lengthy explanation of his original intentions. Writing for The Atlantic, Zuckerman explains that he had unintentionally created one of the most hated forms of advertising on the web.”

Do Pop-up Ads Actually Work? SmartBug attempts to answer this question and those who use, recommend or are responsible for using pop-up ads should read this article. Implementing a strategy that annoys visitors will end your relationship forever.”

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