How Radio Wrecks the Right

A thoughtful John Derbyshire article from The American Conservative.

More Federal Dollars = Less Listener Support?

Every action has side effects.

A potentially big side effect of asking for the asking the federal government for bigger subsidies for public radio is a drop in listener support.

It is well established that a listener’s funding beliefs are an important piece of his decision to give. The more a listener believes listeners fund public radio and that government support is minimal, the more likely he is to give.

There’s research to back this up, but anyone who was raising money for public radio during the Gingrich era knows it is true. Serious threats to federal funding bring out the best in listeners.

On the flip side, news of the big Kroc endowment to NPR caused many listeners and donors to question the importance of their support. Some stations felt the Kroc gift stunted giving at first.

Asking for more federal money risks listener support. It might be necessary to make that ask for stations in dire need, but the side effect could be a drop in donors across the country.

There’s no way to gauge the impact in advance. At a minimum, it will make it more difficult to convince listeners who have never given before to contribute. Every 5 percent loss would translate into an industry-wide loss of between $12 and $14 million. The impact would continue in out years because of a smaller donor pool. .

It’s also important to point out that healthy stations, the ones that don’t need extra federal support, could lose donors and dollars on news that the industry is asking for more money, even if those stations don’t receive new tax dollars.

All of this must be considered in the calculus of approaching the government for extra subsidies. What looks like free money could have significant hidden costs.

Self-Sufficiency: Part 2

There are more rumblings that public broadcasting will ask the Obama administration and Congress for federal money to make up for projected shortfalls this year in state subsidies, foundation gifts, underwriting, and membership.

According to Current.org, CPB management recently told its board that up to a fifth of all public stations – radio and TV -- were financially fragile. Management told the CPB board that the financial impact of the economic downturn could be a single year loss of $418 million in FY 09, with $126 million of that coming on the public radio side.

From what we’ve heard, CPB’s numbers are really rough. They are based on conversations with stations not formal research, so its hard to know how accurate they might be. That said, I would believe that a lot of PTV stations are in financial trouble. Who hasn’t seen that coming for years?

This blog is about public radio though, so we will focus on that from here on out.

Four years ago CPB published a report, “Having It All”, on the financial state of public radio stations. That report said 45% of all radio licensees were running at an operating loss. It wasn't a 1 year trend either. Public radio stations were generating less net operating revenue in 2003 than they did in 1999 even though gross operating revenue was up $180,000,000.

One of the key findings in the "Having It All" report was that station spending, not fundraising alone, was contributing to the problem. There were many excellent recommendations in the report, none of which have been acted on.

Asking the government to help financially strapped stations this year might be the only way to keep those stations from going dark or losing their local identity, as is happening to WMUB in Ohio. But becoming more reliant on subsidies is not a long-term solution.

In order to survive in a new media marketplace and a changed economy, public radio stations need to become less reliant on subsidies. They must become more self-sufficient.

Right now, CPB has a chance for a make good after dropping the ball on the “Having It All” recommendations. It can develop incentive programs that encourage stations to operate in such a way the their core services, national and local, will not be threatened by a sudden loss of subsidies. Any new federal money a station receives should come with that requirement. Anything less is a disservice to the station, its listeners, the community of license, and the taxpayers who are footing the bill.


COMING UP THIS WEEK: Why asking for more money from the feds could be bad for healthy stations and membership fundraising programs around the country. And, tapping unrealized membership growth potential in public radio.

February Fundraising: So Far, So Good

We have a few client stations holding on-air fund drives right now and most are at or over goal. One station started yesterday and missed its daily goal by just a few percentage points. So far, it looks like a typical pattern of daily results.

We haven't had a chance to dig into the numbers but donor response seems strong and we are still seeing some $1,000 and up gifts. That's a similar giving pattern as last fall and the end result was stations meeting or exceeding their goals with more donors and a smaller average gift.

More donors giving smaller gifts is a good thing at any time. It's a positive sign about the value of the service.

Our advice for now -- don't lower your expectations. If you expect less, you will get it. Instead, give your listeners a chance to help you succeed.

Don't Create Your Own Economic Crisis

There is lot of discussion in public radio about how "these uncertain times" and the bad economy might affect fundraising. Some stations are already lowering their goals without giving listeners a chance to help them succeed.

We're advising clients to stick with their goals and find creative ways to meet them. That's because there isn't a station out there that can't improve its fundraising in some way.

Thanks to meticulous planning and great execution, the Winter fund drive at all-classical KBAQ in Phoenix is off to a strong start, running slightly ahead of goal after two abbreviated days of fundraising. KBAQ uses no premiums. Their drive continues through Saturday, wrapping up with the Met Opera. Yes, the KBAQ fund drive is over when the fat lady sings. Well, almost over. They usually get in one more appeal right after that.

KUNC in Greeley, CO repeated its success with a 1-Day drive. Their first one in the Fall went way over goal. This Winter 1-Day drive finsihed more than 110 contributions over goal and exceeded last Winter's 3-Day drive results by more than 300 contributions. You can read more about it here.

The down economy might just be the best time to try something like a 1-Day drive or an All the Money, Half the Time drive. It seems counter intuitive. Harder times typically require more effort. But dramatically shorter fund drives capture the listeners' imaginations. Shorter drives transcend the everyday.

Instead of assuming a tough economy means less money, why not seize the moment to create an economic victory for your station?

A free 1-Day drive kit is available here.