If you have a hammer, everything looks like a nail.
Over the years, radio stations have seen a precipitous decline of in-home listening. Smartphones replaced clock radios, Bluetooth speakers play streamed radio and podcasts. GMA and The Today Show became the soundtrack for many households in the morning. Traditional AM/FM radios ended up in closets, attics and garages.
Edison Research and Triton Digital's annual Infinite Dial study continues to track the penetration of radios in American homes, and the chart makes the trend clear with nearly 30% now reporting no radio in the home. Over 10 years, the number of radios has dropped nearly in half, from 2.9 to 1.6 among people aged 12 and over.
The story is even more dramatic among 18-34 year-olds. 1 out of every 2 millennials now report no radio in their home, which is ominous for radio operators.
So, imagine the glee in radio stations as they watch the ascension of smart speakers and view them as a serendipitous remedy to radio's in-home problem.
As part of our Sonic Ai partnership with Jacobs Media, we have witnessed first hand how radio stations view these cylindrical devices as saviors. Our company jumped in exploiting the fever in our first-wave of marketing as a simple solution to "get radio back into the home."
Radios disappeared from homes for systemic reasons having to do with content, choice and convenience
Nothing is ever that simple and the more we think about this new sector, the more we think radios disappeared from homes for systemic reasons having to do with content, choice and convenience.
Much like Maslow's "Law of the Hammer" -- "if you have a hammer, all you see are nails," radio stations have been quick to add simple "skills" enabling a station's linear stream hoping that Smart Speakers result in a significant increase in at home listening. Early returns are at best, spotty.
The audio choices on smart speakers are infinite with 5 big streaming services, 100,000 radio stations and 500,000 podcasts
In just about every study we have seen, audio listening goes up when Smart Speaker devices appear in family rooms and kitchens. But unlike a typical local radio market with 50 or so stations, the audio choices on smart speakers are truly infinite with 5 big streaming services, 100,000 radio stations and 500,000 podcasts.
In short, smart speakers are not radios. They are audio highways.
Endless choice is a simple verbal command away. The Beatles; sure. Depeche Mode; coming right up. A smooth jazz channel; here you go.
So what should commercial radio stations do to increase their impact on smart speakers?
This is where our thinking about radio's path to success with smart speakers continues to evolve.
Most radio stations continue to underexpose their best content. It is broadcast once and gone, greatly limiting its listener and rating impact. P1 listeners, a station's best customers, miss 80% of every morning show. Used properly, with easy to navigate skills, Smart Speakers can serve up "bite-size" replays of choice content and with some imagination deliver proprietary content designed for this new platform. While it is still early, we see this being accretive in PPM markets.
Put down the hammer and see how people are using audio media these days.
Commercial radio should put down the hammer and stop searching for nails. As they think beyond the stream, they will see how people are using audio media these days and create on-demand solutions in-sync with the vast opportunity of the exploding Smart Speaker universe.
On Smart Speakers, the listeners are asking for it.