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Monday, September 12, 2011

Buying Bird Seed: Does the Public Broadcasting Funding Model Still Work?

"Is membership philanthropy?"
This was a seemingly simple question during the Ethics session led by Walt Gillette, ACFRE from WAMU and Roberta (Robbe) Healey, ACFRE at DEI's Public Media Development and Marketing Conference in July 2011. But given that this was a room of public radio people, it strikes at one of the core principles of the public broadcasting funding model.

How the Public Broadcasting Funding Model is Built
Funding for public broadcasting has been high profile in 2011 due to renewed attempts to zero out funding for the Corporation for Public Broadcasting (CPB). With all the attention Federal funding of public broadcasting has received, many of the general public are less aware of the private funding pieces.

Most public broadcasting stations are funded by a combination of sources in varying proportions. These sources may include:

  • CPB Community Service Grant: most, but not all, public broadcasting stations receive Community Service Grants.
  • Licensee in-kind support: stations are often licensed to other, larger nonprofits, such as an educational institution. The parent organization frequently will provide in-kind contributions of office space, utilities, human resource management, benefits, etc..
  • Foundation grants: some stations are very skilled at securing support from private foundations for specific productions or community engagement projects.
  • Underwriting: one of the two elements with which listeners are most familiar, underwriting is how businesses secure announcements on the air to build brand awareness. Key FCC rules are that there cannot be mention of price, a call to action or comparatives that contribute to "promotion."
  • Membership: the inevitable pledge drives. Almost every public broadcasting entity does some kind of pledge drive, whether it be once a year or several times a year. These involve many volunteers, lots of phones, tons of thank you gifts/premiums/"swag," too many mentions of phone numbers to count, gallons of coffee, dozens of donuts, at least a few coffee mugs, lots of staff time and usually at minimum one embarrassing thing said live on the air. Membership programs are also frequently supported by direct mail campaigns and telemarketing.
  • Other individual giving: several stations with more mature development programs have branched into major gifts, but it is not the majority of stations.
Calculations for what a station receives in their Community Service Grant are based on how much private sector funding the station secures. The more contributions they receive, the higher their eligibility for the Community Service Grant in most cases.

Flaws in Public Broadcasting's Funding Model
Over the past 25+ years of participating in the public broadcasting funding model, as a staff person, as a consultant, as a volunteer and as a donor, I've had a lot of opportunities to see campaigns that really worked and ones that crashed and burned. So here's my opinion of what's broken:
  • CPB funding rewards the successful. When I was at a successful station, this seemed like a great idea! I began my public broadcasting career in one of the most public broadcasting friendly markets in the country--Madison, Wisconsin. But now I'm working with rural and minority stations who can't generate as much community support because the resources aren't there. So are these stations doomed to be under-resourced and overly dependent on CPB funding?
  • Licensees frequently don't understand how to fit a station into their operating structure and don't know how to appropriately spend their funding. Take educational institutions for example. What department does the station report to? How do you classify the positions for appropriate compensation? How do you track spending to remain in compliance with the CPB?
  • There is an incredibly small pool of foundation funding available for broadcasting. Ask any station what foundations provide funding to public broadcasting and they will mention The Ford Foundation, The Knight Foundation, and a limited number of other national funds. Some local or regional foundations will support individual stations, but these tend to be smaller grants.
  • The underwriting "pitch" assumes that your station has measurable audience and that you don't have to go head to head with stations that sell "dollar a holler." The reality for small market stations or smaller stations in multi-station markets is that there aren't ratings numbers or market research for your audience, or at least not ones that you can sell on. In addition, you are fighting for the same marketing dollar that goes to the other stations. Not every station has underwriting staff that is able to sell the differences between public broadcasting value and commercial ad value. If you compete head to head on price, the public broadcaster will lose.
  • Membership, in most cases, is NOT philanthropy.  Back to the original question. It's a transaction. If you don't deliver, you don't get a continued customer. A few loyal people join their public broadcasting station because it's "the right thing to do," but this argument will not continue to work on its own, especially as our audiences move into the Generation X and Millennial generations. If you are providing premiums or thank you gifts, the contributor is driven by that transaction. If you say, "You pay for this program," you are promising to deliver that program. This is not about altruism or solving a social problem, it is about getting stuff.
  • We assume people "get it," but they don't. Public broadcasters assume that the audience knows they aren't fully funded by the government and that we are worthy of support. The average listener or viewer might understand this to some degree if they've heard or seen one pledge drive, but the general public does not. "You guys get my tax money, isn't that enough?"


Transforming the Funding Model
I started thinking about these issues as we were traveling through a very rural part of the Southwest in "hostile territory." We were on a fact finding trip for a public radio station with a construction permit for an uber-conservative community where some people don't know what public radio is and the much of the rest are threatened by "the liberal media" coming into their town. Yet we know that there are people in this community who want public radio. So how do we find support for this?
  • Stop (or don't start) training people to be transactional donors. We started with tote bags, coffee mugs and t-shirts, then escalated to videos, books and CD's, which were just a gateway drug to exclusive concert tickets and the ultimate VIP package of the whole series on DVD, the companion book, logoed tkotchkies and special online access to seminars! (As a regular pledge drive pitcher, I'm part of the problem, because I'm actually pretty good at selling this stuff!) We need to break away and get back to mission. Public radio stations throughout the country have gone "premium free" and survived, even thrived.
  • Underwriting is not advertising sales. Most of the successful underwriting representatives I know are from commercial media sales. But they are also in relatively large markets with a good number of mid to large businesses with actual marketing budgets. They are also in markets where they have audience research numbers. The underwriting sales model has been based on the commercial sales model with a spin in the pitch, but fundamentally is still a commercial model. For underwriting to be successful for all stations, regardless of market size, underwriting efforts need to be fully brought into the spectrum of development activities to build true corporate support, not just generate an ad buy.
  • This isn't about community service--this is about being part of the community. Public broadcasters have been pretty isolated from their communities. Part of it is the "editorial firewall," but part of it is a fear of getting "messy." It's easier to tell stories about social issues than to actually facilitate change happening. Thanks to the efforts of the National Center for Media Engagement (NCME), we are beginning to see stations "engage with their communities beyond broadcast," which is exactly what needs to happen if stations are to remain relevant and fundable. For some of the communities we work in, we need to determine a community need that we can address, not impose what we want to do on this community.
  • Stop focusing on the means and start focusing on the ends. Central to the previous point is that stations need to know what a community wants and needs. What are the root causes to issues and how can public media make a difference? Maxie C. Jackson III, President and CEO of the National Federation of Community Broadcasters frequently reinforces the NCME ethos that stations need to be central conveners for people to discuss and debate community issues in a safe place and stations need to reflect and seek to promote the culture that they are a part of. Stations no longer can stand to the side and report what they observe. For example, recently I worked with the Latino Public Radio Consortium on a proposal where, if funded, public broadcasting in Puerto Rico will support Head Start and Early Head Start programs in a very rural, poor neighborhood to improve the educational progress of their students. Not just about providing children's programming, the stations will be facilitating multimedia ways for the community to express their needs and engage in the learning process.
  • Only when we are less about media and more about making the community better will philanthropists and foundations take note. This will open up more funding opportunities, particularly if public media entities can collaborate with other nonprofit organizations. We are not public broadcasters, we are community activists that happen to have media outlets.
None of these thoughts will actually fix the public media funding model. And I can't even begin to fix the issues with Federal funding of public broadcasting: I'll leave that to 170 Million Americans for Public Broadcasting. But the bottom line is that we in public media need to stop selling a product, whether it be to underwriters or to members, and start initiating change that will make a difference in the communities we are part of. If philanthropy is about "love of your fellow man," then we need to generate passion for our communities, not just treat them as audiences. I'm betting they will love us back.

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