Radio’s Greatest Threat: Itself
“We have met the enemy, and he is us.” Walt Kelly’s famous Pogo line perfectly captures how radio executives and owners engineered their own crisis. It applies just as well to other legacy media companies, like Paramount and The Washington Post.
Many executives point to external factors, especially all the tech platforms, as the source of the radio’s debt and declining revenue. But the truth is harder to swallow: the wave of mass layoffs is largely the result of their own strategic missteps.
How We Got Here
In defense of today’s corporate executives, much of the debt that’s saddling radio’s biggest broadcasters was inherited.
Broad strokes: it goes back to deregulation in 1996, when corporations like Clear Channel, Cumulus, and Citadel went on enormous acquisition sprees, largely financed with debt, betting that sales revenue would pay it off.
Then the dot-com bubble burst in 2000, stalling that growth. The Great Recession of 2008-09 delivered a sharp downturn, piling on debt and triggering sweeping job cuts. The 2020 pandemic accelerated cuts again, and the cutting unfortunately continues.
The Rub
Radio’s financial storm worsened with the rise of digital. Music is universally accessible, and podcasts are flooded with personality-driven shows competing for the same attention radio once owned outright.
Here’s what makes the cuts so shortsighted: Jacobs Media’s Tech Survey found, seven years ago, that people choose radio first for its personalities and DJs, not for the music. And yet radio companies keep making deep cuts to their talent.
Radio’s Competitive Edge: Personalities
Radio Ink recently published a study from Katz Radio Group that drives this point home with data on personalities and their impact on listeners and advertisers alike.
The study’s central takeaway: personalities drive loyalty. They are trusted voices in their communities. Here’s what the data shows:
- Nearly two-thirds of listeners (63%) say personalities are important or extremely important to their enjoyment of a station, and more than half (57%) can name a favorite on-air personality.
- Six in ten listeners (61%) say they’re more likely to consider a brand when it’s endorsed by an on-air personality.
- Nearly 40% say those endorsements feel more personal and authentic than traditional advertising.
A Note to Talent
- Up your game and consistently create memorable content.
- Prioritize developing your endorsement skills. Go to sales meetings. Work it.
- Use multiple digital platforms to expand your brand.
Don’t Kill the Goose
Radio companies would be wise not to follow Paramount’s lead and risk losing the very personalities who create their value. Any young or seasoned air talent with a following is worth saving and investing in.
Podcast listeners consistently say they tune in for authenticity, conversation, and genuine connection with the host. That intimacy and companionship have always been radio’s true north.
Radio’s True North: Talent
Music and information matter, but they’re secondary to personality. According to Inc. Magazine and Loeb Leadership, there are three pillars to a company’s “true north”:
- Purpose Over Profit: Defining why the company exists beyond making money, like delivering an exceptional experience for listeners and clients alike.
- The “Tie-breaker” Tool: When leaders must choose where to invest or where to cut, they should ask one question: Does this strengthen or weaken our connection with listeners?
- Aspirational Vision: Great companies continually invest in developing their people, products, and culture.
Radio has the answer to its own crisis sitting behind the mic. The question is whether the people making the cuts are willing to see it.
