By Steve Lapa
Lapcom Communications Corp
President
If you are a seller in the terrestrial radio business, please listen carefully. That faint voice you hear could be the Fat Lady warming up – old Brunhilde ready to wrap it up and put an end to that long, sad Wagnerian opera, known as traditional, transactional radio sales.
I’m not kidding here, folks.
When one of the big boys on the ownership side starts getting serious about real-time bidding for radio inventory, we are talking Google– YouTube– AdSense-style modeling and that can move your radio station’s ad inventory faster than the super computers used to create this year’s NFL schedule.
Did you hear about what it takes to appease CBS, NBC, ABC, FOX, Paramount, ESPN, Amazon, and YouTube when they spend $112 billion in rights fees? Let us just say, you can’t please all the buyers all the time, but if you want to please some of the buyers some of the time you forget the sticky notes and call in the super-computer guys. I digress.
Not familiar with the bidding process developed by Google for ads primarily on YouTube videos? It is as easy and as much fun as eBay, Vegas, and your favorite silent charity auction all rolled into one.
Recent estimates put Google’s YouTube ad income at about $30 billion, arguably double the size of the entire commercial radio business. This of course does not include the estimated $165 billion from Google search ads, etc. They know the real-time bidding process better than any of us.
Imagine yourself a radio station owner, like I was, only this time having the daily revenue responsibility of 16 commercials per hour on 25 news/talk radio stations. Even if you focus on Monday-Friday and the traditional 6A-7P model, do your math, then think like a pro. NFL 2023-style supercomputer or old school peddle power? The caveat? Has anyone reading this column spoken to a human seller from the Google bidding platform? OOPS! There goes that Fat Lady again, getting a little louder this time.
Not so fast, Fat Lady, there is a silver lining for the skilled, high-achieving seller in this high stakes, real-time bidding future. Remember, Bugsy Siegel started some of this “bidding” on the Vegas strip in 1946. “Monday Night Football” launched in 1970 moving TV coverage into a multi-billion-dollar ad machine and Google started the online version of all this somewhere in 2005. My point is that fine-tuning for profit takes time and resources. The big boys just gave you a peek behind the curtain and showed you the future. The sellers who worked for me heard this opera in 2007, when one million iPhones were sold. That number now is over 2.3 billion. The future is here and moves fast. Refine your skills daily, learn, grow, and become so valuable to your organization, your name is always at the top of the “Don’t even think about it” list.
Someone please tell the Fat Lady to stop warming up and find a different stage… for now.
Steve Lapa is the president of Lapcom Communications Corp. based in Palm Beach Gardens, FL. Lapcom is a media sales, marketing, and development consultancy. Contact Steve Lapa via email at: Steve@Lapcomventures.com