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** INsight!**
Paragon Media CEO Mike Henry.
Wednesday, November 29,
2007
--published by www.insideradio.com
Time for Radio to Make Lemonade By Mike Henry Okay, so Arbitron has moved back the rollout of PPM in all markets beyond Philadelphia and Houston. Is anyone really surprised? I remember sitting in the first industry presentation on the PPM concept many years ago, and thinking, “We’ll be lucky to see this by 2005.” Then, several years later in a similar meeting updating PPM progress I remember thinking, “Shoot, we won’t see this by 2010.” As it turns out, 2010 is about right. On the surface, this is a catastrophe for radio. The entire industry and even Arbitron (at times) has made it clear that the diary methodology is inadequate and outdated, and now we have to sleep in the messy bed we made. It reminds me of radio stations that pissed on another station for years only to have to sell it as a sister station after it was purchased by the same company. Then it’s like drinking the water you pissed in for years – and it’s not fun. Now this is where radio finds itself with the yellow-stained diary. The current PPM quibbling is ridiculous and it’s a waste of time. Anyone who believes the diary methodology is superior to PPM is simply wrong, and probably disingenuous. Clearly, the PPM is a better reporting measurement. It’s imperfect, the results are different, but it is such a leap beyond the diary that any comparisons between the two are moot. It’s time for radio to get on the PPM train. However, we don’t have to punch our ticket to the same destination. This is an once-in-a-lifetime opportunity to re-think and re-shape how radio is bought and sold. Now is our chance to use vastly improved methodologies to break some old ideas and challenge radio’s selling variables. With the diary, radio used to be all about frequency, but PPM shows that radio’s reach is also great. Move off of cost per points. Move onto reach, and frequency. Radio is still a more cost effective buy than television. We’re sitting in a historic moment and we can reset the rules of selling radio time while this window is open. Some won’t want change and will argue the old view from the old train was fine. Maybe for them, but I’m betting the view from this new window could be much more pleasant - and much more rewarding. Living with the diary for more years in more markets is the worst of the new delay. However, there is a very real benefit that radio can achieve during the delay: Get your act together on a selling plan and create a new selling currency. Our industry leaders seem to be great at shooting holes at a big new target (PPM), but very weak at planning ahead for its eventual and inevitable roll-out. If this doesn’t happen now, in this new window that was created by the latest PPM delays, then radio deserves to get steam-rolled by agencies and buyers when they do have PPM ratings in hand. Finally, radio must accept that it must pay more for larger sample sizes to ensure reliability of PPM data. If they’d done this before now, they wouldn’t be sleeping in this messy bed. I know that’s a tough pill for operators to swallow (more money to Arbitron), but it’s an absolute necessity for PPM to work. Out of every bad turn is a good turn, and my belief is that in the long run, radio is very lucky to have this new window of opportunity to use for its own advantage. C’mon radio, use this new opening to turn these lemons into lemonade – or that yellow drink you’re holding will taste much worse than lemonade.  Mike Henry is CEO of Paragon Media Strategies The views expressed are his own. What's YOUR opinion? Send your INsight to Frank@insideradio.com INSIGHT ARCHIVES Feedback HERE. --All rights reserved. No part of this article may be copied or changed without written consent of Inside Radio/M Street Corp. For permissions, email: genemckay@insideradio.com
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