The following continues the education theme of the past several weeks. These snippets have been culled from various sources. All can help build on a “Why radio” story and are worth knowing and sharing with clients. An educated and better informed client is a more loyal client.
James Meyer SiriusXM CEO:
“Stabilizing and growing listener hours on the platform is priority number one for Pandora.”
Comment: Monthly active users at Pandora were 66 million in the first quarter, down from 72.3 million in Q1 2018. A 9% drop in one year. This is a decline of -18% from Pandora’s high of 80 million monthly “uniques.” Imagine the headlines in the press if AM/FM lost this much cume.
A study from IPG Media Lab and Magna Global found that only 71% of TV commercials are “viewable,” meaning audience was physically present in the room for at least two seconds while the spot aired.
Comment: And this statistic doesn’t take into consideration those remaining but multi-tasking during commercial breaks. A 2017 CRE Nielsen/ Neuroscience study found that 40% of TV viewers were also focused on another screen during commercials.
To make matters worse, the inexorable decline in broadcast C3 ratings shows no sign of slowing down. In just two years, the networks have seen 24% of their demo-targeted impressions disappear like the contents of a suburban grocery’s bread aisle during the year’s first snowstorm.
Comment: Network and cable TV audiences are declining even faster than Pandora’s. Not only are people not watching commercials, there are considerably more people not watching TV.
To be sure, U.S. newspapers are starting to fade away, what with the advertising business model blown to smithereens by the web. In the U.S., weekday print circulation has shrunk from a high of nearly 60 million in 1994, to 35 million for combined print and digital circulation in 2018, according to the Pew Research Center. Advertising revenue has plummeted, falling from $65 billion in 2000 to less than $19 billion in 2016, a decline of 70%.
Comment: Advertise in newspapers if your goal is to have your message be exposed to increasingly smaller audiences at dramatically increasing CPMs.
A recent Harris Poll, found that 40% of Millennials don’t spend any time watching live TV at all. Let that sink in. More than a third of all members of this rapidly growing and valuable demographic watch zero, as in not one minute, of live broadcast television.
Comment: Nielsen’s latest Total Audience Report reports that live/time-shifted TV reaches only 73% of Millennials vs 91% for radio each week. Deloitte has also predicted that by 2025, Millennials will spend more time with AM/FM radio than television.
“Of course, most marketers have learned completely the wrong lesson. They’ve seen the efficiency of short-term activation (promotion) and they put all their money in there. But, in fact, what they actually should be doing is making digital activation work efficiently by supporting it with broad-reach, emotional brand building.”
Comment: Binet is an extremely respected ad executive worldwide. The concept of “waste,” aka broad reach, often crops up when citing digital’s advantage over traditional media, but it is this supposed “waste” that accounts for the majority of the new sales. Focus on promotion at the expense of branding at one’s own financial risk. Radio excels at both, building brands and promotion.
Jon Moeller P&G CFO:
“We had tons of spending in the marketplace that was a complete waste, because it was driving excess frequency.” He added that better data and analytics have let P&G redirect spending to reach more people rather than bombard the same ones.
Comment: Commercials do have a lingering effect, so any repeat commercial exposure within a short time frame is less efficient than reaching an entirely new potential customer. Each commercial costs the same, but close-together repeat exposures return less revenue, especially when those individuals exposed multiple times are not any more likely to buy the product. Nielsen’s new NMI product is ideally suited to assist here as it confirms that after a certain point, TV duplicates more with itself than radio, which is why the addition of radio to TV-dominant campaigns dramatically increases reach and provides a more balanced frequency distribution.
“Results suggest that the decay of market share was pronounced and more rapid when a brand was not advertising,” according to a paper, entitled “The Impact of Advertising on Market Share: Controlling for Clutter, Familiarity and Goodwill Decay.” Drilling down into this subject, they explained that although “the decay was slowed by increasing familiarity of the brand, when the brand was not advertising, market shares fell significantly.”
Comment: Common sense, right? But it takes uncommon sense to advertise consistently. Strive to advertise as many weeks as a budget will allow, even at lower GRP levels. It’s true that lower GRP levels generate fewer sales than larger GRP levels, but lower GRP levels generate a lot more sales than no GRPs.
I’d wager that each of you can identify clients to forward one or two of these to. The one habit you could develop that would serve you greatly over the course of your career is the habit of keeping an eye open for, accruing, and sharing similar information with clients. It keeps you visible with value, makes your clients smarter, and you a more valuable partner.
Bob McCurdy is Vice President of Sales for the Beasley Media Group and can be reached at [email protected]