CPB FY 2002 Business Plan

1
System Internet Assessment
Prepared by Mark Fuerst and Paul Jacobs
CPB Staff March 17, 2003
2
Project Design

• One Hundred interviews
• 29 in person interviews
• 71 phone interviews
• Continuous collection of research material July
  - March
• Analysis and writing January February
• Dissemination March April
• Discussion to iMa Conference (April) and PRC
  (May)
• Implementation

3
Project Design

• Three Large Areas of Exploration
• Content Delivery
• Revenue Enhancement
• Listener/Member Service
• The three-hour in-person interviews were based on
  a set of more than 75 questions.
• The responses to the in-person interviews were
  analyzed in August.
• We developed hypotheses
• We eliminated some questions (overall importance,
  system leadership)
• We shortened the questionnaire

4
Findings Management

• Unanimous agreement about growing importance of
  Internet functions
• Station-level managers are relatively optimistic
  about all three major Internet areas
• Content delivery
• Revenue
• Member service
• In general, stations see sites as mostly support
  for their broadcast operation with some
  stand-alone features.
• Station Investment level in web activity is
  modest.

5
Findings Management
6
Findings Management

• Station Investment level in web activity is
  modest.
• Average investment under 40,000 per year per
  station.
• More than half (57) of the stations we contacted
  had less than one FTE working exclusively on the
  station website.
• The majority of non-staff expense is devoted to
  streaming more than 1,000/month per station.
• Total system spending on streaming (at stations)
  is probably 1 million - 1.5 million per year.
  This provides one important area for
  re-directingfunds to more productive investment.

7
Findings Traffic

• Relatively little is known about what visitors
  want from station sites.
• Very few stations have conducted research.
• Managers told us their understanding was
  probablya 2 on a 5-point scale.
• Outside research suggests that
• 90 of visitors listen to the station
• 75 of the visitors are core listeners.
• The most impressive site traffic reports are
  coming from NPR.org.
• Research must be a priority moving forward.

8
Findings Traffic
9
Findings Traffic
10
Findings Content

• After allowing for difference is format, most
  station sites offer similar features and
  functions.
• Station-based staff consider the most effective
  web features to be
• Streaming
• Basic program/station information
• Events calendars
• Online fundraising
• Audio on demand
• Playlists and concert listings
• Many expensive upgrades and redesigns lead to the
  same basic functionality. This is a second
  opportunity for savings and reinvestment.

11
Findings What do stations offer?
12
Findings Streaming

• Streaming is widely viewed by station staff as
  their most effective online feature. However
• Very few stations reported stream-related
  revenue.
• The costs of streaming are relatively high.
• The national streaming audience is growing, but
  the reach of most stations is fairly limited.
• High costs and low revenues have forced most
  commercial stations out of webcasting.
• Streaming represents a distinct opportunity
  todevelop new revenues related to online content.

13
Findings Revenues

• We looked at six online revenue opportunities
  memberships, corporate support, stream revenue,
  major gifts, e-commerce, and subscriptions.
• To date, only membership revenue is substantial
  currentyear web-pledging will be 16.9 to 25.6
  million.
• Some key stations are also exploring online
  underwriting(KQED, MPR, and WBUR).
• Membership represents our largest online revenue
  opportunity. However, inadequate technology and
  staffing will depress revenue growth at many
  stations.

14
Findings Revenues

• Web pledge will almost certainly continue to grow
  toward about 30 of total membership revenue at
  some of the leading stations.
• Forces propelling web-pledge demographics,
  life-style match going comfort with online
  financial transactions.
• Some stations with unique music formats are
  seeing substantial stream-related revenue.
• The attractiveness and effectiveness of other
  mail and on-air will show web pledge growth.
• Music stations should lead in the development of
  hybrid memberships.

15
Findings CRM

• 70 of stations are already involved with
  customer relationship management
• Collecting e-mail addresses
• Offering e-newsletters
• Developing online membership renewal practices.
• NPR has as many as 300,000 email addresses that
  itcannot use, out of respect for station
  concerns.
• Our experience in New Basics suggests
  thatstations often lack staffing, systems
  andmost importantcontent to develop effective
  newsletters.

16
Findings CRM
17
Findings CRM

• Most advanced stations are focusing on more
  sophisticated web-based membership strategies
• Includes expanded customer profiles
• Enables listeners to specify information they
  want to receive
• Daily push e-mail has become the norm for
  major news organizations. Of the stations we
  reviewed, only WBUR offers this service.
• Efforts among major online news publishers is
  now targeting the daytime, in-office
  populationwhich includes many current public
  radio listeners.

18
Recommendations

• Focus on revenue development, especially
  memberships and CRM.
• Policy support (for example, re hybrid
  memberships)
• Matching programs and incentives
• Discussion should commence among NPR stations and
  NPR.org to harness the membership revenue
  potential of the millions of listener visits to
  the site.
• Expanding revenue generation should be CPBs top
  priority.

19
Recommendations

• Resolve the paradox of streaming the more
  successful you are the sooner you go out of
  business.
• Invest in research on the value of streaming
• Reduce costs/increase revenue
• Encourage the development of pilot programs to
  explore hybrid forms of membership support
  related to streaming
• Use streaming to explore web-appropriate
  memberships.

20
Recommendations

• Accelerate the development of effective practice
  by collaborative learning projects.
• Support collaboration between NPR Adaptive Path
  to develop best practice standards
• Promotional strategies
• Develop modest agenda of pilot projects
• Test practices
• Disseminate results
• Managerial toolkit
• The goal here is wide impact to transform basic
  station patterns to be more effective.

21
Recommendations

• Invest in research about basic user interest,
  especially about news features and services.
• Develop a strategic research agenda to fill gaps
  in system understanding
• Continue to compile external research and
  user-based station-generated data
• Work with PBS NPR Online to collect and analyze
  information
• Compile and publish user statistics.
• Develop an Internet Research Consortium.

22
System Internet Assessment
Prepared by Mark Fuerst and Paul Jacobs
CPB Staff March 17, 2003
23
Practical Vision Organization

• Preserve the momentum.
• We now have a coalition of willing partners that
  includes CPB, NPR, PI, PRI, DEI, iMa Stations
• Assessment Foundation for Planning and Action
• Follow-up
• 4 weeks of online discussion on PUBRADIO
• iMa Conference Sessions
• PRC Conference Sessions
• The WebPledgeTools.org and WebToolTips Newsletter
  
• iMa website and InSite Newsletter
• All of this is a direct result of CPB support.
  Encourage continuation of effort.

24
Practical Vision Money

• Where do we find the money?
• Redirect existing funds in FY04

25
Recommendations
26
From our Review of Streaming

• Yankee Group expects the business to go in this
  direction more subscription and pay-per-use.
• When it comes down to revenue generation,
  webcasting is part of the bigger picture, which
  includes advertising and sponsorship, data
  capture, e-mail marketing, online sampling, and
  cross media promotions.
• John Ousby, Virgin Radio

Source John Ousby, Virgin Radio, quoted in
Miles and Sakai, Internet Age Broadcaster, 2nd
ed., p.78 (2001)