Legacy Media: Still the 800-Pound Gorilla

| April 6, 2015

By Bill Brady
Futures & Options, Inc.
President/CEO

bradybillwriterJupiter, Fla. — Regular readers of the media trades or general interest publications have been subjected to a non-stop barrage of digital media brainwashing for the last 15 years.

This is the product of the PR machine employed by digital start-ups to build and reinforce their investment value through rounds of funding leading to an eventual IPO.  Media consultants who hope to survive as digital experts also contribute mightily to the noise.  So do media companies themselves who are complicit in allowing the misguided narrative to go on and on and on.

It goes something like this:  New media sites are dominating.  Seven bazillion registered users, session starts, page views, or whatever.  Radio, cable and broadcast TV–ain’t they quaint?  Slow grow.  Hopelessly behind the times.  Soon to fade into obscurity.

Instead of promoting the incredible vitality and viability of legacy media, corporate execs accept the erroneous premise and play right into the digital deception on the quarterly Wall Street analyst calls.  “Core revenue is down, but our digital revenue is super-charged!”

Except that’s not really true.  Some of the digital revenue reported by traditional media companies is the result of bundling discounts which, in effect, result in broadcast revenue being reported as digital revenue.  If it wasn’t for this phenomenon, some companies might actually be reporting year-to-year increases in core broadcast revenues.  Their digital revenues, small in comparison to core revenue, would thus be less impressive.  But, we would at least be seeing accurate digital revenue figures that are not artificially inflated and the reputation of legacy media would be less tarnished.  We would also be getting a more realistic picture of the limited business potential of most radio station web businesses as they currently exist—but, that’s another column for another day.

What should be done?  Change the narrative.  Halt the comparison of national and international web brands with local radio, TV and print products.  Legacy media’s strength is the depth of its audience and its domination of local markets.

Big internet brands are a mile wide and an eighth of an inch “thick.”  Local media brands are a foot wide and a mile deep.

Let me present a scenario: a retail chain enters a market and opens a series of stores simultaneously.  You’re the CEO or VP of marketing.  How do you use media to drive the launch?

If you said you’d “drive” this campaign exclusively with banner ads, page takeovers, streaming spots and disjointed “ad networks,” you are out of your mind.  No CEO is going to let their entrance into a new market rise or fall with just online ads.  It would be career and corporate suicide.

The only proven route is good old legacy media with its large, high-density local audience.  Yeh, that massive audience delivered by old school radio, TV and newspaper.  Pure tonnage.  Just what the doctor ordered.

There is a role for digital media, but for too long we have allowed the “Digital is Booming, Traditional Media is Dead” narrative to go unchecked.  Digital media has brought a lot to the table, but it is not one or the other.  Traditional radio, TV and newspapers are still the “800-pound gorilla” and play a huge role in the media landscape.

New media is additive, not a replacement.  When you got a microwave oven, you didn’t get rid of your stove.  Facebook, Twitter, Netflix, Pandora, TMZ and Politico enrich the list of media offerings.  But, people still use CBS, NBC, ABC, Kiss FM, Sports Radio and the Big Talker, and the daily newspaper.  A helluva lot of people.

That’s the “Big Story.”  It may not be as cool as the billion dollar internet startup, but legacy media is still a very potent force.  The mission and characteristics are different than those of internet brands, but, still serve a very important purpose.

By the way, the scenario above did happen a few years ago when the Kohl’s department store chain entered the Miami-Fort Lauderdale and West Palm Beach-Boca Raton markets in South Florida.

It was breathtaking.  Nobody could have missed it.  Kohl’s was everywhere, dominating broadcast media and filling the Miami Herald, South Florida Sun-Sentinel and Palm Beach Post with double trucks and those wrap-around ads known as spadea.  They may have done some internet ads, too, but it was traditional radio, TV and newspaper which drove the bus.

If you were in South Florida, it was “All Kohl’s, All the Time.”  Consumers couldn’t escape it.  It was something that could only be accomplished with traditional print, radio and TV.

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Bill Brady is President/CEO of Futures & Options, Inc., a media investment, ownership and consulting firm based in South Florida.  His background includes management positions with Clear Channel, Citadel, Comcast and the Miami Herald.  He can be reached at 561-529-2598 or at wjbrady1@aol.com.

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Category: Opinions