Monday, March 05, 2007

Eliminating Pledge Drives II

Let’s assume that the predictions about the future media marketplace come true. In five years, public radio stations are in a fierce battle for listeners. Listeners have so many choices they can easily avoid pledge drives. As a result, drives become less effective than they are today. The entire membership program is at risk. What’s a station to do?

The obvious options are to cut costs, to become more reliant on underwriting income, to secure more major donor money, or some combination of the above. Even then, the financial demands on stations will require high levels of listener support. Here’s the likely outcome.

1. Stations will still use their air to market the importance of listener support and solicit donations. Most of this will happen through on-air spots that do not interrupt the programming. Some spots will focus on the value of public radio while others will focus on limited-offer premiums. Based on the effectiveness of today’s spot campaigns, stations will be able to replace around one-tenth of their on-air membership dollars through these spots.

2. Stations will run monthly, if not more frequent, promotional campaigns such as sweepstakes and selling flowers for Valentine’s Day. These will be spot campaigns with some 90-second and two-minute pitch modules airing in the hours before the deadline for participating. So listeners will experience some minor disruption. Stations might replace another 20-30 percent of their current pledge revenue with these campaigns.

3. Fundraising specials in targeted hours, such as a Car Talk Christmas Carol, will help stations replace another 10 percent of current on-air fundraising dollars. These specials run outside of news programming, so the core service is free of disruption. The temptation will be to follow PTV’s path and create specials that move a lot of product rather than stay focused on public radio’s core values. As with television, that would lead to short money and long-term damage.

Effectively implemented, the above model could replace up to 50% of current pledge drive revenues. Experience shows us that many of these activities are more appealing to current donors, so stations are not likely to maintain 50% of their new members through these practices.

Reductions in pledge revenue and donors will require increases in direct mail, email, and telemarketing activities. Stations opting out of telemarketing will have fewer donors and less money than those that use it as telemarketing remains one of the most powerful tools for recovering lapsed givers.

The impact on email will be significant. Stations will run email fundraising campaigns in much the same way they run direct mail. Listeners will receive up to a dozen email requests for membership support each year. The total number of appeals per listener will be higher because stations will send monthly or weekly promotional emails to listeners as well. Listener annoyance with fundraising will move from on-air to listeners’ email boxes.

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