School of Journalism
UNIVERSITY OF MISSOURI-COLUMBIA
WBUZ'S SALES DILEMMA *
Brewery or Hospital Commercials?
WBUZ's general manager John Glover was spending his evening
watching the Springfield Hornets, the Class AA affiliate of the
Minneapolis Twins. Glover was having a good time, primarily because
the Hornets were winning, so he bought his third beer from a young
vendor and slouched down to enjoy the game. The Hornets were also a
big winner for WBUZ-AM, which broadcast all of the Hornet's games, as
it had for the past 22 years.
WBUZ was doing very well in the ratings. It had gotten a solid
6.5 12+ share 6:00 a.m.-12 Midnight, Monday-Sunday, in the latest
winter Arbitron, which gave the station an overall number-three rank
position in the market. In the most recent summer Arbitron, WBUZ had
tied for first place with a 9.0 12+ share, due largely to its
broadcasts of the Hornets. WBUZ was the town's leading news and
sports radio station; its main competitors were a Contemporary Hit
and a Country Music station.
A major sponsor of the WBUZ baseball games was the Barrel
Brewery, the largest company in Springfield, a town of 95,000. The
brewery employed more people than any other single employer in
Springfield. The brewery owned the Hornets and was consistently the
largest advertiser on WBUZ, including partial sponsorship of the
Hornets broadcasts and regular spot schedules throughout the year.
John Glover had been general manager of the station for the past
ten years. He modeled the programming of the station after KMOX
radio, the AM news-talk powerhouse in nearby St. Louis. Glover did
all that he could to see that the station got heavily involved in the
community. He was proud of the station's solid reputation for
community leadership and for being Springfield's most credible source
of news and information.
Unfortunately, one of the biggest social problems in Springfield
was a higher-than-national-average alcoholism rate. Considering the
high alcoholism rate, Glover sometimes felt uneasy that the station's
largest advertiser was the local brewery. However, he was grateful
for the revenue from Barrel Beer.
The previous day, Andrew Hargrove, the director of the town's
largest hospital, Springfield General, had visited Glover at the
station with a business proposition. Glover re-played the
conservation in his mind as he watched the Hornets score another run.
Hargrove: "How's business?"
Glover: "Never been better, actually. How's your business?"
Hargrove: "We're doing very well, thanks. The healthcare market in
town is quite competitive, but we're still number one."
Glover: "What can I do for you today?"
Hargrove: "We'd like to run a campaign on WBUZ to alert people about
the high alcoholism rate in Springfield. The campaign will
perform a major community service and will promote our
hospital's excellent de-toxification facilities."
Glover: "Sounds like a great public service to me."
Hargrove: "However, there's one stipulation. I want you to stop
accepting Barrel Brewery advertising. We can't run an
effective health campaign with those beer ads on the same
Glover: "Are you serious? The Barrel Brewery is our largest
advertiser. If I got rid of the beer ads, I'd not only lose
advertising revenue, I'd lose the baseball broadcasts, which
give me great ratings. I simply can't afford that."
Hargrove: "I understand that you may lose some money, but we're willing
to make it worth your while."
Glover: "What do you mean, make it worth my while?"
Hargrove: "Let's face it, we're conducting the campaign to serve the
community, but we're also doing it to get alcoholics where
they belong--in our de-tox center. We know you have the
largest audience in town, and naturally we want to reach the
most people. We also know that you are committed to public
service and that your audience believes in WBUZ. We're
willing to pay at least three times your normal price for
commercials on WBUZ."
Glover: "But I don't know whether that will generate as much revenue
as the brewery advertising does. Also, I need the baseball
Hargrove: "Well, if you aren't willing to take our public service
business, some other stations will be delighted. Also, if
the community knew you're more interested in money than
serving the public, wouldn't this hurt your image."
Glover: "Well, I do have to make a living, but I also have to think
about my station's image and credibility. Maybe we can work
Hargrove: "I hope we can."
"Strike three, you're out," hollered the umpire. Glover snapped
out of his thoughts and back to the baseball game. He scanned the
ballpark and thought, "I sure would hate to lose baseball." As he
weighed Hargrove's proposition and implied threat, he felt torn and
anxious. He understood the benefits of going either way, but he
couldn't see how he could get out of making a decision for one
alternative or the other--the brewery or the hospital. This was one of
the most difficult decisions he had faced since becoming the general
manager of WBUZ.
* This case was prepared by Charles Warner
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