Contextual Radio Ads: Clear Channel's New Pitch to National Marketers

Can Match Ads Not Just to Songs or Artists but Even to Other Spots

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LOS ANGELES ( -- When radio listeners heard ads last fall for AC/DC's "Black Ice" album, sold exclusively at Wal-Mart, right after an AC/DC song played on 106 different rock stations, it was no coincidence.

Jeff Howard, president of radio sales
Jeff Howard, president of radio sales
It was part of Clear Channel Radio's yearlong preliminary introduction of a new service that can automatically insert radio commercials immediately after specific programming or certain kinds of content -- including other ads. Clear Channel and MediaVest, Wal-Mart's media agency, put the program together to promote the new AC/DC record. Now Clear Channel is offering the service to all its national advertisers.

Radio's always been attractive for local businesses, but those national advertisers needed a more innovative platform, said Jeff Howard, Clear Channel's president of radio sales. The first-of-its kind contextual ad platform was that solution, he said, attracting Wal-Mart, Geico and Visa as launch advertisers.

"Over the years we've really built up the proper systems to speak in one voice with programmers and automate these programs for advertisers," Mr. Howard said. "This has put us in an advantageous position to be able to do things on a large scale with large, national advertisers."

Two radio buyers said Clear Channel is the only radio company that has offered a contextual ad platform at this scale, although CBS Radio has the capabilities to activate similar opportunities across its 200-station footprint.

Aligning radio ads with relevant content can still take time to execute. A contextual campaign for Geico took close to six months to put together, said Lauren Russo, senior VP-managing director of local audio at Horizon Media. The campaign was admittedly tricky; Geico wanted to illustrate its "save 15%" brand message in different ways, including airing 15-second spots after ads for cars, motorcycles or RVs, running ads at 15 minutes past the hour during morning drive time and airing a 60-second Geico commercial with the customized 15-second spot. But after all the preparation, the campaign resulted in strong engagement metrics, a high volume of positive buzz and the award for Radio Plan of the Year from Media Magazine.

"We're thrilled with the campaign and are always looking for innovative ways to showcase our client's ideas," Ms. Russo said. "This is definitely something we would entertain in the future on behalf of any of our clients."

Visa's contextual experiment matched its 15-second spots with more than 25,000 ad messages from retailers in 120 markets, all to make sure its credit card was top of mind when consumers were making purchases. The marketer and its media agency, OMD, allocated dollars from TV to fund the campaign, garnering a 10% rise in short-term purchase activity using Visa cards compared with the year prior.

Mr. Howard said several dozen advertisers have also experimented with the contextual platform, with Geico in talks to renew for 2010.

Broader radio resurgence?
Renewed faith in radio among those advertisers seems to be contributing to some of the surprise growth in radio ad spending during the first months of 2010, with spot buys in major markets up as much as 30% from the year prior. Retail, finance, entertainment and telecom marketers are all posting double-digit spending increases on radio during the first quarter, signs that the industry could post its biggest resurgence since 2002.

"Over the last decade radio has really put itself in a strong position to aggregate audiences between the mobile and all things digital from deeper diving with Ando metrics and [Arbitron's] PPM and hyper-focusing mobile applications," Mr. Howard said. "The economy has responded, advertisers are back and new advertisers coming to radio. I'm optimistic about 2010, and we'll see where it settles."

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