According to Oren Harari in his 2007 book, Break From the Pack; How to Compete in a Copycat Economy, one successful tactic radio stations should consider to bolster their business is the “Willie Nelson Effect”. When asked why he became so successful in the early 90’s and how he anticipated and benefited from the country music explosion of that era, Willie replied he saw what was coming up in the clubs and honkytonks and simply positioned himself there. He became a big “outlaw” country superstar as a result.
There is an enormous opportunity for Radio to utilize this Willy Nelson strategy to their advantage. It’s called Revenue Sharing; a program that has stations present daily deals of spectacular value to their audiences. In case you’ve been living under a rock, the wildly popular Chicago based web-based company Groupon has been hugely successful in taking away local revenue from radio stations with their group buying discounts offered on the internet. Practically every dollar Groupon and all their internet competitors earn is from direct local businesses; the primary source of radio stations of income. And yet radio stations, after seeing how popular these programs are, could easily pull a “Willie Nelson” to repatriate much of this business and reinforce their traditional position as a leader in promoting local merchants. And what great business this is.
Consider the fact that with this type of program everyone wins. Listeners spend billions of dollars a year across North America on these daily deals simply because they love to get fabulous discounts on the food, entertainment and experiences offered by these revenue sharing, daily deal companies.
Radio stations will love the new revenue stream, the fact it requires very little of their current on-air inventory to implement, the increase in the number of visits to their websites and the opportunity to develop relationships with an entirely new cadre of clients this type of program delivers.
And merchants (clients) love the fact they can attract hordes of new customers and they only have to pay for people who actually use their product or service - so they know exactly what their ROI is. From their perspective, they get an entire Groupon style promotion with radio exposure thrown in for free!
Groupon, Living Social and all their competitors rely on the internet and social networks to spread the word about their deals. As a result, most of these companies’ expenses are from promoting their deals to prospective buyers. Internet based daily deal companies salivate at the reach radio stations already have. Its true radio has an enormous number of listeners the internet companies would love to have for exposing their deals; but stations also have popular high-traffic websites, loyal listener clubs, Facebook Fans and Twitter Followers. They have live personalities that can really make the deals come to life on the air with their endorsement. And they already have established relationships with hundreds, even thousands of local and national merchants. In short, Radio stations already have everything they need to take over what Groupon and the other internet companies have begun in their communities.
Ask yourself how your station rates as a Willie Nelson. If you were to emulate his superstar business tactics, here is what you’d be doing. You’d be constantly looking at the edges to see what the next big thing is and you’d be looking for people who are serving those needs. That’s precisely why Groupon style daily deal programs are so ripe for radio stations to take over.
