What we learned at BizLab this summer (WBUR)

Oct 3, 2018

Revenue Experiments in Public Radio

WBUR launched BizLab back in 2015 out of a desire to ensure public radio stays financially strong, vibrant, and relevant to our audiences. Since then, BizLab has been dedicated to identifying new markets for content, developing new partnerships with business, education and tech communities, and evaluating new membership and revenue sources.

I joined WBUR six months ago as BizLab’s Executive Director, and since then my team has earned a little revenue and a lot of sweat equity. I'd like to share a bit of what we've learned and our approach to running revenue and innovation experiments in public radio, with the hope that you’d like to join us in testing ideas at your station.

Three Experiments

This past summer I had three Fellows, Cynthia Yue, Suzie Hicks, and Wendi Ding, each evaluating an idea for increasing revenue at WBUR. We took a lean startup approach where we focused on answering questions, which boiled down were:

  • Is there a market for non-pledge-drive merchandise? In public radio, exchange of merchandise usually occurs during pledge drives, yet direct sales of merchandise has been a strategy for arts and nonprofit organizations for years. WBUR has 500,000 weekly listeners, most of whom are not donors. So based on the hypothesis that we have a market of loyal listeners that might buy fan merchandise, we launched a four-week, online pop-up shop selling WBUR-branded items. You can read the details of how we set up the store, promoted it, and the financial results.

TLDR: We figured out how to run a break-even merchandise business, but this idea is not going to save public radio.

  • Can we create engaging online book content that generates significant affiliate revenue through Amazon’s affiliate program? Because books are often discussed on WBUR’s local and national programs, we have rich book-related content on our website that can link to purchases through Amazon.com. Amazon’s affiliate program gives about 8% of a purchase back to WBUR (this is different from smile.amazon.com which gives 0.05% to nonprofits). We created a new user experience for finding books and evaluated this design against existing experiences on wbur.org, to find out which book experience generated the most revenue. You can read about our design process and results in detail.

TLDR: We found that recommended book lists are the most engaging for our listeners and easy for us to create. The profit margin is high, given the low effort, and we made a couple thousand dollars this summer.

  • Will listeners donate if we communicate with them about their unique reasons for listening? We generated three WBUR listener personas based on prior user research and then tested the effectiveness of communicating to WBUR’s audience by persona. We wanted to figure out if the personas reflected unique populations in our listener audience and understand whether communicating to them in the language and perspective of their persona would result in them engaging more with us. Our experiment design and the results explain the detail of our approach.

TLDR: There are unique groups of listeners, engaging for different reasons, but engagement with us didn’t vary with unique messages.

Our Biggest Opportunities

The details of each experiment are available on BizLab’s website and we can answer any questions if you drop us a line: bizlab@wbur.org. But there are three high-level commonalities across our learnings which likely apply to other stations and will certainly apply to our future WBUR experiments:

  1. Content is king. Our target market is looking for deep, engaging content. We found that our listeners love our book content -- articles and lists of books. And it was easier to get users to click on ads for books than ads for t-shirts. When brainstorming ways to engage listeners, start with thinking about your content.

  2. Curation is our unique value proposition. Every day, WBUR’s editorial teams make decisions about what news and information to broadcast, filtering down the deluge of news and information available. Our listeners appreciate us for our curation, and they trust the voices and stories they hear, knowing they are curated by us. Use your UVP to offer new content to your audience.

  3. Women are leaning in. WBUR has more female than male donors, our merchandise pop-up store had 60% women shoppers, and the women's shirt was the top seller.  Our advice is: at every opportunity, the first demographic use case you should focus on is the female listener.

Our Biggest Challenges

I've been surprised by some of the challenges in our experiments. We have so many loyal listeners and a small percentage of them donate, so I thought it would be easy to find the majority and engage with them. It is not. In each of our experiments, the people signing up, filling out the surveys, buying the t-shirts, and looking for book recommendations are... existing donors.

Reaching new audiences and engaging them is hard. Whether you are looking for younger, digital-only, non-donors, or a new demographic, the path to them has not been cleared, or else they'd already be engaged. I'm looking forward to cracking this open next.

The other enormous challenge is station culture. We like to say at WBUR "culture eats strategy for lunch," and no matter what the best laid plans are, if the culture of the station isn't ready to receive the project's findings, there is no point in doing the project.

The third challenge is your station’s existing revenue channels. They are influencing the available market for your revenue idea and it is important to know those factors going in, and make deliberate decisions about how to work with or around them.

For example, if your station does not have a website with significant traffic, then you cannot monetize that traffic (with ads, affiliate marketing, etc.). If your station doesn't have any email addresses of non-donors, any email marketing campaigns will be handicapped.

But the constraints go beyond this. With our pop-up shop, we hoped that non-donors, who like WBUR, would buy a $25 shirt, even if they don't donate. We also hoped existing donors would spend additional money to an item they really wanted. We found that the market for WBUR merchandise was much smaller than we'd anticipated. Of the customers we obtained, 60% were already donors. And from many informal comments we got about the merchandise, we've concluded that WBUR’s biggest fans 1) automatically assume our merchandise is a gift from us (so free) and 2) already have more than enough fan merchandise because we've given it to them (for free). In short, because of our existing pledge gift model, we eroded any market for merchandise.


Join us!

If all of this testing is intriguing, and you’d like to try out testing some ideas for new revenue at your station, join us! With new funding from the Corporation for Public Broadcasting, we are now expanding BizLab’s focus to identifying and testing funding models with other stations. Through a collective of seven stations simultaneously experimenting, we are confident we will uncover new avenues for revenue generation that will benefit all of public radio, as well as establish a process for generating and evaluating ideas for new revenue.

Consider applying to be part of our cohort of public radio stations, ideating, testing, and learning. Applications are due October 19th, 2018.

-- Joan DiMicco, Executive Director, BizLab, WBUR

Questions? Want to learn more?

Learn more about  Bizlab experiments by visiting: publicradiobizlab.org. Or email  bizlab@wbur.org

If your station is trying something new or if you are part of an innovative collaborative, let us know at NPR so we can share your great work!