Attendees at last month’s Public Radio Program Directors conference in Pittsburgh heard insights from several prominent researchers into the listening habits of an audience that’s increasingly adopting digital platforms. One researcher on the stage was Fred Jacobs, whose consulting company, Jacobs Media, works with PRPD to conduct the annual Public Radio Tech Survey. The survey polls core public radio listeners about how and why they listen. Jacobs appeared on Current’s podcast The Pub to talk with host Adam Ragusea about the latest Tech Survey and its lessons for public radio. This is an edited transcript.
Jacobs: The whole idea of these surveys is to help public radio understand what the audience is doing when they’re not listening to their stations. We started doing these in commercial radio first, and it worked so well that we brought it over to public radio, and in the early years NPR was involved as a sponsor. PRPD [Public Radio Program Directors Association] has been with us all the way, so essentially what we do is aggregate a group of public radio stations; this year we had 54 of them participate. We tap into their email databases and serve up our survey online; we had more than 19,000 respondents complete questionnaires, so it is a ton of data.
Current: How would you characterize the people in the sample group? Are these core listeners?
Jacobs: These are core listeners; 85 percent of our sample are members. So it’s the Pareto principle, the 80/20 rule where 20 percent of a population produces 80 percent of the results: This is that 20. These are core public radio listeners and so the idea is, if you understand what they’re thinking and where they’re moving, it really does open the door to understanding where the entire space is going.
Current: It seems to me that the top-line finding is that one-fifth of weekly usage among this sample group is listening through some kind of digital service, whether it be streaming on their computer, whether it be podcast, whether it be the NPR One app. That’s one-fifth of weekly usage through digital sources, a small number.
Jacobs: Actually, I think it’s a big number.
Current: I guess that’s a generational thing between you and me, which is what we’re going to talk about in a minute.
Jacobs: The interesting part about it is that radio in general — and certainly public radio falls underneath that umbrella — is in a very precarious position from the standpoint of regular radio usage versus digital radio usage. Regular radio usage — terrestrial listening — is measured pretty well by Nielsen either in their diary or their metered markets. Where the measurement really begins to break down is on the digital side. I mean, there’s great digital measurement happening out there. Stations can figure out how many people are listening to their streams or how many people are downloading podcasts, but none of those numbers are aggregated with the terrestrial ratings and so, as a result, stations are not getting credit for all of the usage out there. To a great degree, what that has done is stunted how much radio actually talks about all these other digital channels.
If you listen to broadcast radio, whether it’s commercial or public, you don’t hear anywhere near as much promotional conversation about all the different ways that you can consume the radio stations’ content. One of the reasons for that is that programmers know that that digital listening really is not additive to their terrestrial listening yet. Nielsen’s all over this; Nielsen knows that you can’t monetize what you can’t measure. So I think we’re going to look back at this kind of awkward period in time a few years from now and go “Wow, that was just so strange that that everybody was moving to digital consumption, and yet we weren’t really talking about it and promoting it” because, again, it just doesn’t have the kind of financial impact, either in public or commercial radio, that eventually it will.
Current: That totally makes sense but — this is kind of an aside — can you help me understand why Nielsen hasn’t been more on top of this? Does this threaten their business model in some way?
Jacobs: It doesn’t threaten their business model, but certainly there has been resistance in certain radio circles to look at Pandora and Spotify and some of the other peer-play listening. It’s competitive. Again, it’s the same thing that other traditional media have gone through in terms of digital disruption, so I think maybe that has been part of it. But the other part is that consumer behavior is moving quicker than research companies can adequately measure it and take advantage of it, and it’s expensive, and the solutions are not exactly linear. It does take a lot of time and a lot of brainpower, so there’s been a lot of mitigating reasons why this hasn’t been together. And remember that Arbitron was sold to Nielsen just a couple of years ago, so there was that transition as well. It all kind of comes down to that.
But the other part of it is that broadcast radio listening is still bigger than what many people think. They’ve done these studies — whether you’re talking to advertisers or media pundits, if you will — and when you ask the question, “What percentage of the population listens to the radio every week?”, nobody guesses 93 percent. Everybody thinks it’s a heck of a lot lower than that. And yet the reach numbers have held up well. Clearly the time-spent-listening numbers have eroded, and if you zero in on, say, millennials — and you can see that in our data — millennial usage is obviously not as strong as it is for baby boomers.
Radio has actually held up a lot better than many people think, but, as we pointed out in PRTS7, slowly but surely — the ridiculous metaphor I think I gave is that the toothpaste is out of the tube — whether you promote your stream or you promote your mobile app or you promote your podcasts, people are going to find it, and that’s what’s happening now. It’s been more organic than it has been promotional, but eventually, if you’re in the space where you love podcasts, radio better be there providing great podcast content. Public radio, fortunately, has been way ahead of the game.
Current: The thing that people are talking about the most regarding your data in this study is how you break down these numbers generationally. You’re looking at contrasts in usage and trends between Xers and Gen Y — those are millennials and boomers. Walk me through some of those contrasts, because they’re really stark.
Jacobs: It’s massive, and what it suggests and what the data are telling us is that to a great degree public radio has two audiences. There are the traditional listeners who have been with the space for maybe decades. But then there’s this emerging audience that’s smaller, it’s younger, but they are fascinating. So they do really just about everything more than their parents and grandparents who listen to public radio, with the only real exception being satellite radio; millennials aren’t going to pay for that kind of content. Connected-car penetration isn’t as strong among Gen Y, but when you look at everything else — streaming audio and video, social media usage, smartphone and tablet ownership — there’s no question that millennials are in many cases at double or beyond the levels that we see with boomers.
And this year we actually broke it out to specific brands, so when you look at, say, YouTube, Netflix, Pandora, Spotify, Instagram, many others, you can see that millennials are not just leading the way. But it’s important that public radio, in the spaces in which it can participate, needs to be active in connecting with the audience, because younger listeners are going to these channels and using them. If public radio is there, great, but if it’s not they’re going to find other content to satisfy them. So there’s great opportunity here, but I think it also puts the burden on public radio right up to the network level — APM, NPR, etc. — to be sure that the content is there. Public radio, though, is ahead of commercial radio in a lot of these areas, and that’s a good thing.
Current: One fascinating generational difference that’s in your study is that millennials listen, or say that they listen, for different reasons than boomers.
Jacobs: Yes, it’s interesting. We asked the question “Why public radio?” and gave them a laundry list of possible reasons and asked them to tell us which ones are the main drivers. For millennials, in particular, the runaway reason is they enjoy learning new things. Some of the other basic public radio principles are intact, even among millennials, in terms of credible objective programming in a balanced perspective.
Current: And those are the top things for the boomers, right?
Jacobs: Those are indeed. There is quite a bit of commonality, but it’s interesting that there is a difference among that quest to learn new things. I think that’s very exciting for public radio programmers to understand that when most millennials come to their radio stations, yes, they want to be entertained, but they do want to learn — and this is where I think public radio has a tremendous opportunity, especially when you think about what has happened to so many other media outlets over the past decade or so. To a great degree they have really dumbed down their content, and public radio has really held up extremely well. That’s why we see those kind of levels, especially when you zero down and look at millennials.
Current: When you look at membership across the generations — this is fascinating — Gen Y millennials are much, much more likely than any other generation to be sustaining members if they are members.
Jacobs: Correct. And it’s just a theory, but I think that that kind of payment plan works better for millennials, the one bite at a time as opposed to writing a check for a hundred bucks. It’s so much easier to do the five- or 10-dollar-a-month plan. The other piece of that is that so many millennials are now used to paying for their content in exactly that fashion, whether it’s Spotify or Netflix; public radio has a great opportunity to capitalize on that, and I think you see that in the data. One of the things I threw out to the PRPD conference just last week is this idea: Is the name “sustainers” the right name to be using in order to essentially package that kind of membership plan? I don’t know the answer to that; I think it’s something that’s easily researched.
Current: What do you think is an alternative?
Jacobs: I’m not sure, maybe “subscription.” There’s a lot of different ways to think about it; I’m just not sure that sustainers — that might work, but it also might be more of an inside term, kind of the difference between how we say it and how they think about it. But you’re right; it’s a very exciting thing because ultimately, in the public radio system, everybody looks at sustaining membership as being the Holy Grail. And the fact that the younger the generation, the greater the likelihood that they are in fact sustainers is really an exciting proposition, so that’s something that they can build on.
Current: I think it’s just a lifestyle thing. I think my dad still sits down and pays bills at his desk. Mine, everything is on autopay; I can’t imagine devoting brain space to actually sitting down and paying a bill. But my dad is also a really avid podcast listener, so I was surprised to see how small the podcasting numbers are, not only in your study but in the numbers that were presented by a number of your researcher colleagues who were on a panel with you at PRPD in Pittsburgh. Larry Rosin of Edison Research talked about a big study that was a detailed single-day diary of all audio listening, not just radio. And if you look at the widest sample group, the one that reflects all Americans, only 2 percent of those people listened to a podcast on that one day that was studied. Larry also said that if you narrow the sample size to regular public radio listeners, 17 percent of the overall, 5 percent of regular public radio listeners listened to a podcast on that sampled day. These are just pathetic numbers, but what Larry said that really got my attention was that among those 5 percent who did listen to a podcast that day, podcasts shot to the top of the list of the things that they listened to that day. To me it’s hard to make that transition to a podcast, but once you go you never go back. It becomes your jam.
Jacobs: I think so, and part of my job is to take a look at this data and see it as it exists now but begin to extrapolate out where it’s leading us. I do think that when you look at our study — and I’m so happy that we included, for example, YouTube and Netflix in our overall media-usage model, because when you look at how high the levels of usage of both of those platforms are, it strongly suggests that video on demand, TV on demand is clearly becoming a major-league thing. I don’t think it’s that big a leap to think about podcasting as having those same characteristics on the audio side. The tremendous upside there is obvious, and public radio already has a gigantic lead over broadcast radio in the podcast space.
The real challenge moving forward now is, how will public radio fulfill that challenge? I thought it was interesting that Eric Nuzum, former NPR exec but now with Audible, is investigating a lot of the same possibilities. I think everybody in the room clearly is energized by the success of Serial and Invisibilia, and the point we wanted to make with our data is keep going. The potential here for on-demand listening is just tremendous, and people’s behavioral patterns when it comes to consuming audio content change over time. So it’s critical that public radio is there with content and programming and information and entertainment that really fit those needs. Even though the numbers are maybe lower than what a lot of people think they should be, there is great momentum for podcasting and, over time, this is going to be a huge opportunity for public radio.
Current: Before we finish up here, can I ask a stupid question? How do you get paid? Like you, like Larry at Edison, you guys do these studies that obviously take a lot of time and resources and money, and then you publish a lot of the results for free, and you talk about them on shows like mine for free. Where do you get paid?
Jacobs: We do get some compensation. It’s essentially break-even on, for example, the Public Radio Tech Survey. Each of the stakeholder stations contributes a modest amount to getting that study done. It’s not a profitable study per se, but I think Edison, ourselves and other companies that are doing these kinds of things, we’re building our brands. This is an opportunity for us to have leadership in the space with the data.
Current: That makes sense, but what’s the thing that you do that does make money?
Jacobs: What we do that does make money is we consult, both on the commercial and the public radio side, and we also do research for individual public radio and commercial radio stations. We are doing research studies for individual stations, so that’s part of it. We also get speaking fees — I’m giving you my whole model here — not at every convention but at certain ones. We are paid nicely to be able to present and speak, but it really is about building brands. If you think about it, it’s really not all that different than what musical artists and groups are going through. They’re not making that much money anymore on selling their music; it’s more about their performance and shirts and hats and merchandising. Maybe I should start making up “Jacobs Media” shirts and hats — you’ve given me a great idea.
Current: The last thing: One of the central ironies of my life is that the only reason I’ve had a career in radio is because of the car. Public radio, this technology has had so much longevity because of the car — and I hate cars. I hate what cars have done to our built environment, I ride my bicycle to work every day, but cars remain important. You’ve got an event coming up where you’re going to be looking at the relationship of the car to what we do.
Jacobs: It’s a crazy thing because we’re from Detroit, and so up to this point there really hasn’t been any intrinsic benefit from that. And yet all of a sudden now, the car is becoming central to radio because for all these years — and if you think about it, the automotive industry and the radio industry kind of came into mass consumer play around the same time, around 100 years or so ago, and the radio has always been ubiquitous in the dashboard — but now all the auto companies are building very, very sophisticated media and entertainment systems in the dashboard, and there’s really a hole in the fence. The automotive companies are allowing content to come in from a variety of different sources, whether it’s satellite radio or the ability to be able to pair your phone and import or port over your apps and your other content.
We kind of happened onto this through our mobile apps company Jacapps. We started going out to the Consumer Electronics Show in Las Vegas, and we ran across all these car companies displaying their vehicles. But nobody was looking under the hood; they were looking at the dashboard. We started seeing embedded apps in the dashboard and — one thing led to another — we started getting to know some of these automakers. We actually have a development deal in place with Ford, and that led us to create the DASH Conference three years ago, which is sort of a mashup of radio and automotive, and it’s an amazing conference. We really have ’em all; we’ve got the OEMs — the manufacturers like Ford and General Motors and Toyota and all those brands — talking about the latest and greatest in the dashboard. We’ve got the radio community showing up in force now. We’ve got c.e.o.’s from some of the biggest radio companies, in fact Bob Pittman from iHeartMedia is keynoting this year. Adam Carolla will be there talking about the importance of on-demand in-dash entertainment, so it’s really going to be a lot of fun. It’s November 4th and 5th here in Detroit, and if your listeners are interested they can just go to dashconference.com and see the agenda and all the information. But, yeah, it’s going to be a great show.
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