The Current Impact of COVID-19 on Underwriting, Part 3

Corporate Support, COVID-19

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Cities and towns across the country are beginning to open back up, and we are entering a new phase of COVID-19 recovery, to varying degrees. For public media underwriting, this next phase brings evolving market factors - and opportunities - to which sales teams must adjust. Here’s a quick update on what Greater Public is hearing from station sales professionals across the country as they continue efforts to sustain sponsorship revenue in the months to come.

Business Categories

  • Home Services: stations are seeing some uptick in categories like home improvement, landscaping, gardening and specialty services (i.e. gutters, lawn treatment), given the attention consumers are now giving to home and garden as they spend more time at home.
  • Professional Services: with many companies now supporting a virtual workforce, cyber security firms are emerging as prospects.
  • Political: regardless of economic recovery scenarios, many agree that political advertising is coming back, and likely in a big way given the current climate and the limited in-person campaigning taking place. As it does in any other presidential election year, this will put pressure on commercial inventory in ways that can play in our favor. Public media may be able to leverage traditional advertisers getting bumped from commercial stations, or those wanting to escape the political clutter, to help make up some lost revenue. (Also, consider this refresher about underwriting with candidates, campaigns and PACs.)
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Best Practices for Pitching Digital Sales

Corporate Support, digital sponsorship

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Before the recent pandemic, public media stations had been enjoying years of solid growth in digital advertising. COVID-19 will certainly impact revenue for the near term, but digital is still one of the fastest growing media platforms in the world. That’s not likely to go away. Our audiences continue to listen more and more to our digital audio content. And now that many listeners work from home, they are engaging with our digital content in increasing numbers. 

As we work to establish a “new normal” in the wake of the COVID-19 pandemic, it’s important to be ready to talk about the value of our digital offerings, so we are well-positioned to monetize our increased traffic and audience engagement when digital advertising revenue begins to come back.

Here are three areas to focus on when pitching digital:

Know Your Selling Points

  • Audience: Our digital audience is just as high-quality as broadcast, but tends to be younger, more affluent, more highly educated, more diverse.
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What’s Past Is Prologue: What We Can (and Can’t) Learn From the Last Recession

Membership, Corporate Support, budgeting, Major Giving, General Management, COVID-19

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We are all looking at our budgets. How will 2020 end? And what assumptions should we make for revenue in 2021? To borrow a quote from screenwriter Willian Goldman, “Nobody knows anything.”

We are far from the end of the story about how the COVID-19 pandemic will affect our lives, our communities, our economy, or our public media organizations. As we all prepare our worst-case, bad-case, and less-bad-case scenarios, I can’t help but look back at how public media weathered the Great Recession of 2008.

I have no doubt that all of you have done due diligence on how your individual organizations performed from 2008-2010+ for clues on how to imagine things unfolding. For a system-wide perspective, Greater Public analyzed relevant station data from our Benchmarks reports from the recession years, and we’ve gathered insights from several other data-minded colleagues at national organizations.

Public Radio Individual Giving Tells an Optimistic Story

Based on data from a consistent group of 47 public radio stations that participated in Benchmarks from 2008-2011:

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Five Ways to Increase Digital Sponsorship Revenue in FY21

Corporate Support, digital revenue, COVID-19

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Public and commercial radio have seen website and digital platform traffic surging in the last three months during the COVID-19 pandemic. Listening habits are shifting from broadcast to digital platforms and smartphones specifically are being used even more than they have been in the past. This is a shift in behavior that can be leveraged for more digital revenue if planning and preparations for success are made now. Are you ready?

Borrell Associates shared in their April 2020 webinar that Phase 3 of business reopening will be an opportunity for media if we are prepared. Borrell Associates research predicts a boost in advertising revenue this summer. Here are five ways you can increase your digital revenue in FY21 when businesses reopen and when some events that were delayed this spring come back in Phase 3.

1. Review your digital ad revenue.

Compare your year-to-date FY20 digital revenue to that of FY19 (using your data from Greater Public’s FY19 Benchmarks for Public Radio Fundraising) to see if your sponsorship team is increasing digital sales. Many teams look to double digital revenue year over year. If you are already maxing out your digital capacity, look for new digital ad units you can offer or ad units that could be better utilized.

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CBD Underwriting: Still a Complicated Business Decision

Corporate Support, CBD

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Since the Farm Bill legislation last year (which changed the legal status of hemp, therefore making certain types of CBD products legal), there has been increased discussion about what this means for public media underwriting.

In the past, the FCC has generally warned stations not to advertise or accept underwriting for “illegal” products and underwriting messages are protected by the First Amendment only if related to “lawful activity.” 

But now that some CBD non-food products derived from low-THC industrial hemp (.3% or lower) are legal under federal law, it could follow that stations interested in accepting underwriting from companies with CBD products would face significantly lower risk.

That said, stations should still proceed with caution.

Here are some tips to consider as your station weighs the risk associated with this opportunity:

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Accommodating Adjusted Copy Requests During COVID-19

credit copy, Corporate Support, COVID-19

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As station sales teams and their underwriting clients continue to navigate through the COVID-19 crisis, many sponsors are requesting changes to copy to reflect the times. In doing so, stations are struggling with maintaining the right balance between adhering to FCC guidelines (which have not been changed), and offering sponsors flexibility in messaging in the spirit of supporting the community and preserving business for the station. 

After consulting with our own legal counsel, we offer the following copy considerations for the current landscape. 

Guiding Principles

In general, it is perfectly appropriate to adjust copy to reflect how an underwriter may be responding to COVID-19 in your area. Indeed, as community broadcasters, our listeners would most likely expect our sponsors to use their connection to the station to inform listeners of changes in their own services or mission as the pandemic continues to unfold. This is not “business as usual” for any of us, and public media stations and their sponsors are working hard on behalf of the communities we serve. That said, stepping into new copy territory can be challenging, and it may be helpful to keep the following in mind:

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The Current Impact of COVID-19 on Underwriting, Part 2

Corporate Support, COVID-19

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A week after our last post, we thought we’d share a quick update on what we are hearing from stations across the country and the various ways in which sales teams are working to sustain sponsorship revenue and navigate these uncertain times. 

Business Categories

  • In addition to prospecting  “essential businesses” (i.e. grocery, restaurants, auto repair, urgent care, food banks, etc.), the following categories are (re)gaining traction in some markets: government agency (i.e Department of Health), healthcare (tele-medicine services), education (universities promoting online curriculum), tech, UPS stores, retail (birdseed delivery, pawn shops), and nonprofits with donation messaging.

  • Many markets report “essential businesses” getting more creative with the services they offer and are looking for ways to get that message out. For instance, some restaurants are adding to existing menu take-out and delivery services by allowing customers to add pantry items like flour and eggs - even cleaning supplies and toilet paper - to their order.

  • Some markets are also using tools like Media Monitors to track which businesses are active in the market (on commercial and otherwise), in an effort to keep as accurate a lead list as possible.

  • Several markets report that sponsors of station-hosted events are opting to bank investment for future use rather than ask for refunds.
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The Current Impact of COVID-19 on Underwriting

Corporate Support, COVID-19

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Published March 27, 2020

We’ve been talking to station cohorts to understand the impact of COVID-19 on station underwriting thus far, and to surface the strategies and opportunities that are helping stations stay focused as we all learn how to navigate the new normal. In the spirit of sharing and offering support to all stations, here’s what we’ve learned so far:

State of the State

  • Revenue: Markets where the virus hit early and hard are down as much as 60-65% for March and April. In other markets, where the virus has not yet emerged to the same degree, March is down between 20-30% and April down over 30%. In some cases, end-of-year won’t be as bad, as stations had a strong start to the year. That said, May/June impact are unknown and so end-of-year and FY21 forecasting is a work in progress for most. 

  • Categories: Not surprisingly, underwriting from performing arts and other event- and travel-oriented businesses represent the biggest loss, as well as banks and financial services in some markets. Those markets with a lot of event revenue or retail/restaurant revenue have been hit the hardest, while those markets with more B2B business are faring better. Interestingly, some markets are keeping their nonprofit sponsors and some are losing them rapidly. Those going off the air tend to be nonprofits that were marketing their events; nonprofits messaging their mission have stayed on-air. Other clients staying on-air tend to be law firms, healthcare, and other non-event-related businesses.

  • Digital: Traffic to station websites and digital content is surging.

  • Listenership: Audience numbers are also up on-air, although there is concern about how work-from-home and shelter-in-place orders will affect drive-time listening.
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Reassuring Your Underwriting Clients During COVID-19

Corporate Support, COVID-19

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As COVID-19 cases continue to spread, this is the time to check in with your underwriters and strengthen your relationships.

Keep in mind that your underwriting contacts may be extremely busy preparing for the full impact of COVID-19 in your area.

Here are some suggestions when you contact them.

Express your concern about how they are doing. 

Ask how the virus is affecting their business or how they might feel if COVID-19 becomes more prevalent in your area. 

Find out what they are doing to reinforce their relationships with their customers. 

Are they having to cancel performances or events, or is it business as usual for now? 

If they are shortening their hours, or if they have products or services that are critical for their customers to have during this time, ask how they are reaching their customers and prospects with that information. Their responses will give you some idea of how to help them.

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Pivot Underwriting Categories as a Result of COVID-19

Corporate Support, COVID-19

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Events and performances are being cancelled across the country in response to the COVID-19 pandemic. As a result, it’s time to gather your corporate support team to make a plan to pivot away from performing arts and event sponsorship.

Credit copy that inspires the audience to visit public spaces at this moment sounds wrong at best, and may also be impossible as venues close temporarily or limit operations.

Instead, businesses in the following categories are in an excellent position to strengthen their brands, especially with messages that show corporate social responsibility.

  • Healthcare of any kind
  • Colleges and universities (Consider any that are within 4-6 hours of your station) 
  • K-12 private schools
  •  Nonprofits (Promote their missions and community support)
  • Financial services, credit unions, community banks, financial management
  • Business services, employment services, back-office support, IT support, etc.
  • Luxury retail and jewelry (For example, engagement rings, Mother's Day, graduation gifts and Father's Day)
  •  Automotive (Good fits are usually Subaru, Lexus, Volvo, Mercedes Benz, Lincoln, BMW, and Land Rover)
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