Inside Radio Show 2018

News that the Amazon is reworking how it integrates skills into its fast-growing Amazon Alexa rocked the smart speaker world this month since the device has the biggest share of the market. But the real change may’ve gotten lost in the headlines and experts told the Radio Show on Thursday that skills are still very much a must-do for local radio stations.

“Skills are not dead,” Hubbard Interactive VP of digital strategy Jeremy Sinon told the Orlando conference. He explained that while Amazon will no long require Alexa users to install a skill, stations will still need to produce what’s essentially an app for a smart speaker in order to ensure listeners can easily access a station. “The skill will still need to exist because we still need to provide the technology for Alexa to be smart enough to get what they’re asking for,” Sinon explained.

For broadcasters and other companies working on the backend of Alexa, Sinon said the shift will actually mean developing those skills will become even more complicated. He also urged radio not to waste any time jumping into the fray because as Amazon rolls out its changes, users’ past behaviors will become a bigger dictator of what action Alexa takes when the device hears a simple command. “The time to build those past behaviors is right now,” Sinon said. He said having a dedicated station skill also helps what can be an at times confusing situation for Alexa, and a frustrating situation for a broadcaster, to see a user ask for a specific radio station only to see the device play a different station on the pre-installed iHeartRadio and TuneIn platforms.

Westwood One COO Charles Steinhauer said they’ve learned that it’s sometimes easier to simply create multiple skills for the same station when there are multiple ways listeners refer to it. He pointed to hot AC WPLJ New York (95.5) as such an example, ensuring that if a listener asks Alexa to “Play PLJ” or “Play 95.5 PLJ” they access the same content.

The New Household Receiver

The arrival of smart speakers couldn’t have come along at a better time for radio. Jacobs Media’s most recent TechSurvey showed 83% radio station database members said they had a traditional AM/FM radio in their home. That was down five points form a year earlier despite a survey methodology that pulled respondents from some of radio’s biggest fans. The survey also showed two-thirds (68%) of Millennials said they didn’t own a traditional radio unit. “This is a real issue for radio whether smart speakers came along or not, fortunately they did,” Jacobs said.

Jacobs Media’s TechSurvey found that one-in-five (21%) of households now have a smart speaker, nearly twice the 11% reported last year. And among those who do use a smart speaker, 42% said they actually had two or more devices scattered around the home. Jacobs said it’s the fastest gadget growth he’s ever seen in the 12 year that his firm has conducted the TechSurvey. “This is bigger than iPhone growth,” he noted.

Sinon said Hubbard saw less than 10% of their streaming consumption done through smart speakers last year, and after the 2017 Christmas season that jumped to 12-13% in 2018 and has held pretty steady through the year. “Our streaming in general is lifting from these devices,” Sinon said.

One fear is that smart speakers will make it easier for consumers to listen to things other than their local stations, but Jacobs said their research found that 20% of owners said it was doing the opposite and they were actually consuming more AM/FM radio. Just 7% said less. “That’s why so many people in radio are understandably bullish about the opportunity in this space,” he said. “On the one hand radios are disappearing from the home and on theother hand these devices are beginning to proliferate. They’re not ubiquitous yet, but that time is going to come very soon when they will be.”

For radio to continue growing its position on smart speakers, experts say promotion and education will be critical. That includes giving listeners instructions on how to access a station’s skill, and what’s the best way to ask the device to play that specific station—a critical issue when there are plenty of stations around the country with a similar on-air handle. Sinon said Hubbard has produced snappy tutorial videos that have proved especially effective.

There’s already another incentive developing in the form of improved ratings. “We’re really seeing a lift in audience for brands that are promoting them,” Jacobs said.