Friday, July 7, 2017
Small Town Blues
As many of you know, the Nielsen company divides the U.S. television universe into 210 separate entities know as Designated Market Areas (DMA’s). New York is clearly the largest and tiny Glendive, Montana is the smallest and ranked at #210.
A few months ago, I received an e-mail from a small market operator asking why I did not devote an MR post to markets with a low Nielsen ranking. A bit later I heard from an old associate who still toiled in a tiny market asking basically the same thing.
Hence this post. I contacted several people across the country who were either general managers or sales managers in markets ranked #110 (Ft. Wayne) to #180 (Marquette). For those of you who are amateur detectives, I did not speak to anyone in either Ft. Wayne or Marquette!
Small market TV was once a great business and then it morphed, like all over the air TV, into a good business. Now, according to my wildly unscientific sample of seven small town broadcasters and sales executives, it has a new set of struggles.
Here are some comments (some edited) from all of the participants:
--“When I talk to my competition or players in broadcasting in neighboring markets, they seem to be in a time warp. At a golf outing recently, I told a competitor that he was sleepwalking to disaster. He did not like that but he still seems to think that it is 1977 instead of 2017. The game is not over but big cracks are evident in our facade.”
-- “Last year, a local cable interconnect nabbed my most experienced salesman. I could not afford to keep him despite pleas to our owners to up his compensation. He now is stealing many of our long standing local retailers with zoned buys that deliver far less waste than we can because we cover the entire DMA. Also, he can tap into canned promotions from ESPN and others that we cannot match.”
--“I can tell you what is killing us in one word--Amazon! We lost four retailers on Main Street this year. When I drive to work each day I see the boarded up stores and it kills me. One was a clothing retailer that allegedly had been with the station at some point in every quarter for the past 62 years! Now, with more buying online and the trend toward casual clothes, he had to liquidate. Retail is in real trouble. Our local mall’s days have to be numbered.”
--“Headquarters keeps telling us to improve our news product. I was always proud of our local community involvement but the newscast was always poor. People over 70 watch it and many probably don’t have cable. A U.S. Senator stopped in to town the other day and I told our anchor to ask some pointed questions about the upcoming GOP health care bill (we are in a non-competitive market but this was real news). He did not want to do it. I almost choked when he said he might get a better response if he asked the Senator about the college football season this fall. Furious, I made him ride to the deli that was providing the food for the staff party that we were hosting for the Senator’s visit. I read him the riot act in the car but when we went in to pick up the platters, everyone surrounded him as if he were a movie star. It drives me crazy. We have a crap news product but the locals, who still watch over the air TV, love it.”
--“Technology has helped us a lot. We do not do local weather. A weather man from another one of our corporate markets does it via remote and it seems to work. Also, we can send a reporter out with one other person or sometimes alone to do a story so that cuts down on costs. We are so small that we still do Video News Releases on slow news days. Hell, every day is a slow news day here.”
--“We have never recovered from the Great Recession. I see no hope for turning our town around. Not to get political, but our local hospital may have to close depending on what health care bill the Senate cooks up soon. Why would anyone want to retire here or raise children or give birth to children if the nearest hospital is 150 miles away?”
--“I have had a great run. When I started, I did two years in a top 10 market and that was enough for me. We did a good job for decades for our small clients. Now, I know that TV does not work nearly as well as it once did. I feel guilty sometimes with clients as the returns are sad compared to years ago.”
-- "Automotive has always been our bread and butter. Local dealers make or break us. A dealer who is a close friend is alarmed. Customers have been getting seven year loans for a number of years. The problem is that they return five years later still under water on their pickup truck but need a new one. They have no cash for a down payment but they need a vehicle for commuting to work. He finances nothing but the local bank will as does his manufacturer. He sees a big problem coming. If we lose a chunk of automotive advertising, we will never hit sales goals.”
Are these comments truly representative of all small market DMA’s? Well, three players were from rust belt markets in the Midwest so perhaps the comments are a bit gloomy. One thing is certain, however. The media landscape continues to change and you cannot hide out in rural America on the assumption that Amazon cannot touch you.
If you would like to contact Don Cole directly, you may reach him at email@example.com