Here's a sampling of how difficult 2009 was for radio:
- Ad revenue was down 21.3% compared with 2008, according to research firm Outsell. “It took a big hit,” said Chuck Richard, VP-lead analyst at the firm.
- Radio company Citadel Broadcasting Corp. filed for Chapter 11 bankruptcy protection in December. In the third quarter its revenue declined 14% from a year earlier, according to Standard & Poor's Ratings Services, which downgraded Citadel on the news.
- And even the medium's purported high-tech savior, satellite radio company Sirius XM, had 405,181 fewer subscribers on Sept. 30, 2009, than it did a year earlier. Additionally, the company's third- quarter advertising revenue fell to $12.4 million, a drop of 15.6% from the year-earlier period.
As radio struggles—and what medium isn't these days?—it is offering much more than simple air time to attract advertising dollars from marketers, both b-to-b and consumer. “What I'm noticing is that the radio ad sales representatives are packaging so much more with a radio buy,” said Ted Kohnen, VP-interactive marketing at Stein Rogan + Partners. “You get the on-air, the ad on the podcast, the ad on the Web site and the ad in the e-newsletter.”
Perhaps as a response to the difficulties of 2009, a number of radio networks have spent the first days of this year downplaying their
medium's traditional characteristics and emphasizing new ways for marketers to reach audiences on the air, online or via smart phone. Some examples:
- Clear Channel Radio unveiled last week the capacity to enable contextual advertising on its radio programming, a capability that mimics Internet advertising. In a test campaign, the new service enabled Wal-Mart stores to automatically place ads for hard rock band AC/DC's new album immediately after an AC/DC song played on Clear Channel stations. “This goes to show that not all advertising innovation is happening online,” said Andrew Frank, VP at Gartner.
- The Wall Street Journal Radio Network last week introduced the WSJ Radio widget, which is available for the network's 380 affiliate station Web sites. The widget is designed to display continually updated content from a variety of Dow Jones & Co. news sources—and, of course, provide new sponsorship opportunities for marketers, particularly b-to-b marketers.
“Great radio stations satisfy listeners' appetites for news and information online and on air,” Nancy Abramson, executive director of The Wall Street Journal Radio Network, said in a statement.
- NPR is enabling video marketing messages on its NPR News iPhone app. Recently, an interactive video for the band Vampire Weekend appeared on the app, and this opportunity, of course, is not limited to consumer marketers.
“We were nonradio before nonradio was cool,” joked Blake Truitt, NPR's senior VP-sponsorship. Truitt acknowledged that NPR had a difficult 2009 in sponsorship revenue—down about 20% overall—but digital revenues from opportunities such as podcasts were up about 8%.
Despite the difficult past year and even though radio brands are offering a variety of new ways to reach listeners, many media buyers and b-to-b marketers still like radio forr old-fashioned reasons.
NPR, for instance, added a number of new b-to-b marketers recently, including Cargill Inc. and IBM Corp. It provides access to a highly educated audience, and Truitt said its programming reaches one-third of CEOs.
Media buyers like programming such as Bloomberg Radio, WSJ Radio and ISP Sports college football radio broadcasts because they reach an audience with strong demographics. They also like it because that audience is often a captive one, trapped in their cars during a commute. “It's a noise-free medium,” Kohnen said.
Radio is also versatile, say media buyers, who point to its capability to function as either an awareness or direct response medium. Additionally, they praise radio's flexibility in enabling marketers to change their messaging relatively easily. They also say it's cost-effective and has not increased its prices relative to other media.
Most marketers that use radio advertise on the medium as part of an integrated program. “I think radio is primarily used as a secondary or tertiary medium,” said Sheree Johnson, senior VP at Nicholson Kovac, which has used radio for some of its agricultural clients such as FMC Corp. and Kinze Manufacturing.
Caroline Riby, VP-media director at Roberts Communications, said radio is a particularly efficient medium for small businesses looking to reach a local audience.
J.H. Cohn, the 14th largest accounting firm in the country, focuses its business in the Northeast and in Southern California. The firm spends about 10% to 15% of its branding budget on radio spots featuring Los Angeles Dodgers Manager Joe Torre. Most of those spots run during drive time on Bloomberg Radio.
“Radio provides a second dimension to our messaging,” said Charles Ludmer, J.H. Cohn CMO. “Radio allows for our spokesperson's distinct voice to be heard.”