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Saturday, October 25, 2014

A Cure For Burnout?

I first heard the term burnout in the early 1980’s. Someone had left our agency and her boss wrote a note saying about her, “Totally burned out. Leaving the business.” Today, a week does not go by when I do not receive an e-mail or in a conversation have someone use the term. Some people even say it about themselves.

Psychologist Herbert Freudenberger is credited with coining the term back in the 1970s. The standard definition usually is something such as “long term exhaustion and diminished interest in work. Reporters Bianchi, Schonfeld and Laurent projected that 90% of workers who are “burned out” meet diagnostic criteria for depression.

I sent the burnout question to about a dozen members of my Media Realism panel. You had to be over 50 and in the advertising or communications business for more than 25 years to be asked to weigh in on the issue.

Most people felt that it was growing but I did get some interesting answers and a few hard nosed ones. Highlights, all quoted with permission, were:

1) “The people who say that they are burned out always tended to be the lazy people who were not bad enough to fire but never really great performers. Now that we all have to work a lot harder in the ad business, they say that they are burned out. Well, they certainly are not exhausted. They never worked a week like I do every week and have for 40 years.”
2) “A lot of the alleged burnout cases around me are people who cannot keep up with the changes. The business has passed them by and they hide behind burnout. After a drink, some will tell me that they just want to survive 5 or 10 more years and then retire. Somehow they think that the clock is going to stop. What irks me, and I am 59, is that this is arguably the most exciting time ever to be in advertising or media. My regret is that I will be gone soon and miss all the fun. One woman told me the other day that she wished we were back in the day when she only had to buy three stations in a market. I am not sure if these people are depressed. They, to me, suffer from lack of engagement. Change is scary, sure. But there is no alternative to it, none”.
3) Lastly, a very thoughtful executive gave me his cure for burnout. “Don, I have, as you know, changed jobs and companies every 5-7 years for the last 35. It is the perfect tonic for creeping burnout. The challenge is to prove yourself in a new arena and with new clients and customers. You never get in to what you used to describe to me as “a comfortable rut.” Also, when you start a new job, all of your ideas seem fresh to your new associates. I knew it was time to leave a job when associates would tell me that they knew what I was going to say about an issue before I opened my mouth. When you start a new position, for the first couple of years, you are not so predictable. You also learn a lot when you change your group of cronies. I have always loved getting a different perspective on things. A change in venue does that in spades.”

My last friend from item #3 has an interesting perspective. Fortunately, he lives in a big city, New York, where he can change jobs without uprooting his family. If you are in a Baltimore or Burlington or Salt Lake City, it might not be so easy to leave an agency or media property and find a similar or better job across town.

Clearly, depression is a big problem in 2014 America. Yet, are some people using it as an excuse as some of my panel members seem to feel? And, is leaving your present job the solution in many cases to reinvigorate your career?

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Tuesday, October 14, 2014

Has Online Video Finally Arrived?

On October 6th, THE WALL STREET JOURNAL published an interview with Daryl Simm, the CEO of Omnicom’s Media operations. He is ultimately responsible for the spending of approximately $55 billion in media across the world.

In the interview he noted that his firm is currently advising their client base to place some 10-25% of their TV dollars in online video.

When I read it, I immediately sent it out to a few friends who responded pleasantly with comments such as: “Wow” or “It’s about time” or “We are already doing that.” Over the next few days, the tide turned and my e-mail box filled up with angry comments largely from local broadcasters.

The passionate remarks included, “Why can’t he just shut up” or “who cares what he thinks, the stuff never works.”

I do not think many of the angry people read the interview. He was quite measured. The Journal reported that Mr. Simm “said that cable and broadcast network owners are getting a significant portion of that money back, since their programming still makes up a large share of the premium online market.”

Mr. Simm also went on to say that, “We look at delivering against segments of an audience. If you are trying to increase your reach against light TV viewers, the answer is to move a significant part of the video budget to online video. We council the client depending on what businesses they are in.”

A few people said a hard and fast percentage is a bad idea. I agree but 10-25% is a pretty big range. He is clearly stating that individual analysis is required depending on the account and its target.

Being longer in the tooth than most of you, I remember when Ted Bates way back in the early 1980’s published their 5% solution. What they were saying was that to hedge your bets and get the total audience for many brands, you should put 5% of TV buys on WTBS, then known as a Superstation. Many in the media scoffed and said all TBS had was Atlanta Braves games and Gomer Pyle reruns. But, did you notice that within a couple of years, cable took off as an advertising medium and then, a decade later, local cable finally got the recognition that it deserved?

Online video may not garner 10-25% of TV budgets next year or even in 2016. The die, however, is cast.

Also, did you notice that today You Tube announced that their Google Preferred ad space is sold out? Coincidence? Hmmm.

Still another train is leaving the media station. Do not get left behind, my friends.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Saturday, October 11, 2014

Moving The Goalposts

The term “moving the goalposts” is a metaphor for something that is changed while in progress. It originated in Britain but is frequently used in the United States when the rules of the game or measurement metrics are changed.

I first became aware of it as a young adult reading claims of the East German government for industrial output (yes, I led a wildly exciting youth). They were so ridiculous that I knew that someone was cooking the books.

In the United States, they move so gradually that you have to watch carefully or you will miss them or dismiss them. It first hit me in the early1980’s when Social Security increases were adjusted to reflect a “more realistic” cost of living for recipients. They took mortgage interest rates out of the calculation saying that few recipients were in the market for a mortgage. On hearing, I nodded and moved on.

Then, coming off the terrible 1982 recession, the Reagan administration suddenly blended the 1.5 million Army, Navy, Air Force, and Marine personnel on active duty with the civilian work force. Presto! The unemployment rate fell--some say by as much as two percent.

A decade later, the Clinton administration upped the ante big time. The moved goalpost was also unemployment figures. If you were so discouraged that you gave up looking for work, you were no longer counted as unemployed. If you wanted full time work but could only work part time, you were not in the unemployment figure. And, full time work was now 21 hours per week even though benefits had to be paid at 30 hours per week.

The Core Consumer Price Index no longer includes food or energy costs. Actually, it has not for years. What? Nope. Food and energy price swings are considered too volatile and short term. Recently (2012), the Core CPI has been replaced and even a stat geek like me is having a hard time sorting out the new formula.

So, are our government statisticians a bunch of liars? No. I am sure the staffers are very careful about the calculations. Are they forced to manipulate statistics and data by policymakers? Yes! When the criteria change, the formulae change.

It is hard to tell whether the economy is really improving when “the goalposts are moved.”  Interestingly, people on both sides of the political and economic spectrum share their annoyance with governmental adjustments. Jim Sinclair, a “gloom & doomer” and passionate gold bug and Chris Hedges, a strident left wing journalist, both swear by John Williams’ Shadowstats. Williams once had a job analyzing government statistics and decided to publish his own as the “official” numbers in his view were so divorced from reality.

Critics say this cozy arrangement has lots of benefits. The government pays less in pension adjustments and social security and private companies can pay less in wages by claiming that the cost of living has hardly budged. Our Social Security time bomb has a slightly longer fuse and business can drop more to the bottom line by citing government cost of living stats at raise time.

While preparing this, a panel member suggested that a similar scam is going on with the Nielsen +7 audience measurement (actual viewing plus playbacks for the next week). I thought that was a bit unkind as a broadcaster or cable entity has the right to charge for their entire audience. He countered that most of the people playing back a program days later would edit out the commercials as they went along. He also said that prices were driven not by audience size but supply and demand so the Nielsen +7 was another example of a “moving a goalpost.”  His point was certainly well made.

Mark Twain once said that, “There are lies, damned lies, and statistics.”  The great humorist was on to something.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Friday, October 3, 2014

The Useful Life of Legacy Media Properties

There is an old axiom that makes the list of most personal finance rules. It is simply, “Don’t finance anything for longer than its useful life.”  Practically speaking, they are saying do not borrow money for vacations or clothes or anything else that is consumed quickly or depreciates fast. A 30 year loan on a house is okay if the interest rate is reasonable as the house may last 100 years. A four year car loan is also okay as the car should last much longer (the new seven year loans could be problematic).

Recently, I had a lively e-mail exchange with a retired broadcaster and asked if he would be interested in buying a TV or radio station. He responded, “Don, I only borrow if the item has a useful life. Today, I do not know what that would be for a local TV or radio property.”

Intrigued, I began asking around. No one was as succinct as my e-mail buddy, but they tended to agree with his assessment. A TV executive said, “ I was asked by a local business man if I would like to form a group to buy a local TV station (not mine). I started laughing and he was annoyed. Look, I told him. We have all worked hard the last six years in this market and billing remains lower than it was in 2007. How long can TV last as an effective TV medium? I don’t know. I do know that we cannot continue here as a viable business if we see revenue dropping almost every year for a decade.”

A radio executive put it this way: “I get so tired of industry wide averages. Okay, so radio is up 1% or maybe 2% nationally. That is an average. If a sunbelt market or a cluster of them is up 8%, good for them. But my podunk mountain time zone market is down almost every year. Do I want to put my savings plus that of some trusted friends in a wasting asset? We try hard but billing is shrinking. Some larger market guys can grow some with solid online sales. We get little response there. Our young sales folks work hard but earn very little. The game has changed.”

A lively radio guy told a great story that may contain some exaggeration. It went like this: “We have a kid who grew up here who made a couple hundred million in Silicon Valley. He loved sports but was just terrible at it. A local lawyer said we should approach him and get him to buy my station which has been a dog for several years. He could even go on air when he felt like it but control his own sports format. I thought it was crazy but I approached his dad whom I know slightly. He laughed in my face. “My son would like to own a major league franchise but he is not a billionaire yet. What he will do is bet a few million per year on start-ups or launch his own creation. He can fail 30 straight times for the rest of his life and still leave my grandchildren a bundle. I will not tell him about this local idea.” It was hard to argue with that!”

Broadcasting used to be a great business. Now, especially in large or growing markets it remains a really good business. Yet, the game is changing as digital takes over and commercial avoidance grows especially among the young. Why go in to big debt or any debt in markets with a weak economy or declining demographics? There may be no one to sell the property to several years from now as the baby boomers age and even they abandon legacy media.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com