History: 1920s

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By the "Roaring '20s," the consumer economy that started around the turn of the century was flourishing, and a mass market was in the making. By 1925, nearly 40% of the U.S. workforce earned $2,000 or more a year, and the six-day workweek was reduced to five. People had free time and could take vacations. There was money to spend and advertisements, appearing in newspapers and magazines, described what to buy, why and where.

One example of the rise of popular media during the 1920s is Time magazine. In 1923, 25-year-old Henry Robinson Luce and a former Yale University classmate, Briton Hadden, founded Time, the first weekly newsmagazine in the U.S. Messrs. Luce and Hadden were the first publishers after World War I to break away from past models of general-interest magazines and offer something radically new—news and information. Brevity was key to the format, separating the publication from other weeklies. Time was also distinctive in its focus on news rather than commentary.

The rise of radio

A debate of enormous and far-reaching importance dominated the 1920s: Who would pay for radio? The answers made the decade one of the most crucial in advertising history because they laid the foundations for broadcasting in the U.S. and Europe.

The technology of voice broadcasting had been developed more than 25 years earlier. It was during the 1920s, however, that radio became the mass communication technology it is today, growing out of a combination of institutional and technological innovations and individual ideas. Although the Netherlands claims the first radio broadcast in 1919, information was already being transmitted via radio in England, Germany and France.

However, commercial radio broadcasting found its foothold as a form of entertainment in the U.S. through a combination of factors, including economic depression, the influence of corporations, urbanization, electrification and the recognition of production, consumption and distribution.

The U.S. had just recovered from 25 years of wild economic fluctuations, economic depressions, an unusual amount of concentration of corporate wealth, political turmoil and labor unrest. Radio entered this arena at a time when a handful of major corporations were becoming increasingly powerful and consolidation of ownership was once again on the rise.

In the early 1920s, radio listeners were regarded as hobbyists—a subculture that found amusement and relaxation tinkering with crystal sets—and listening was considered simply a pastime.

David Sarnoff, the founder of Radio Corp. of America, is generally credited with taking radio into the mainstream of American life. A former wireless operator, Mr. Sarnoff recognized that radio's financial potential depended on its being thought of as a household appliance.

He oversaw the introduction of the "Radiola" by American Marconi (later RCA) in 1922. The first Radiolas sold for $75, a hefty sum in those days, but a price within reach of America's burgeoning middle class. First-year sales were $11 million; by 1925, sales totaled more than $60 million.

Despite widespread interest, many people considered radio to be in poor taste and a waste of resources. To them, radio was the technological manifestation of society's ills, a symbol of modernity and creeping consumerism as well as a threat to traditional family values. A 1922 article in the advertising trade journal Printers' Ink warned that "the family circle is not a public place, and advertising has no business intruding there unless it is invited."

Radio was viewed as a particularly intrusive nuisance by the newspaper industry, which felt that radio infringed on the formerly undisputed role of newspapers as the purveyor of daily information and entertainment in the home.

Funding models

In the early 1920s, few gave any thought to the financing of radio stations. Early stations such as KDKA in Pittsburgh were not expensive to run. Frank Conrad, chief engineer at Westinghouse Electric & Manufacturing, began his radio career by sending signals from his garage. From his makeshift station designated 8XK, then KDKA), Mr. Conrad sent music from borrowed phonograph records, and his popular musical broadcasts caught on. Listeners began asking for a wider variety of entertainment and for longer broadcasts. Professional talent was in demand, and that required money. By 1925, funding reached the crisis stage.

In the U.S., early radio was the voice of various businesses and commercial institutions. The Chicago Federation of Labor established WCFL. The Chicago Tribune had WGN (for "world's greatest newspaper"). Department stores, churches and governments saw radio as a way of putting themselves before the public as "public service." Overall, the consensus was that radio should be privately owned and that advertising should be kept out at all costs.

Direct advertising, or the purchase of time from a station for the presentation of commercial messages, was the financing strategy that won out. Concerns over an ad-supported model were shared not only by the general public but also by the newspaper industry, where advertising was considered to be in opposition to the public service model of radio.

Radio advertising enters the mainstream

In 1922, American Telephone & Telegraph Co. established WEAF in New York as a "toll station." Under the toll model, people who had something to broadcast paid to do so, just as telephone time was sold.

AT&T treated its investment in radio as a public service effort. At first, WEAF management stated that it would provide no material of its own, but it soon realized few were likely to pay a toll to broadcast on the radio. For the first six months in fact, no one stepped forward. Those willing to pay finally trickled in, and the first "commercial" (named from AT&T accounting practices) aired on WEAF between 5 p.m. and 5:30 p.m. on Aug. 24, 1922. It was for the Queensboro Corp., which paid $50 for a 10-minute message promoting the sale of apartments in Queens, New York. The announcement was repeated four times, and an additional half-hour of evening programming was purchased. Several apartments were sold as a result, and direct advertising was pronounced a success.

One month later, two more companies broadcast messages—Tidewater Oil and American Express Co. In less than a year, WEAF had 25 advertisers, including the R.H. Macy department store, Greeting Card Association, American Hard Rubber Co., Bedford YMCA, National Surety Co. and Metropolitan Insurance Co.

Station managers, politicians and other public officials were concerned that radio advertising could compromise the dignity of the medium. In fact, the pressure brought by potential advertisers—and the financial pressures ad revenues relieved—led to advertising becoming the primary source of financial support for radio, with the proviso that the advertiser provide the program content in which to place its ad message.

Radio now was positioned as a civilizing force, bringing classical music and famous orchestras into otherwise mundane lives. Proponents of radio claimed that it had the potential to elevate the popular taste. The most obvious example of this view can be found in ads for radio receivers, which showed elegant homes and tastefully decorated rooms where couples in eveningwear listened to the classics.

Acceptance and growth

In 1926, RCA, which already owned WJZ in New York, bought WEAF from AT&T and formed the National Broadcasting System. That November, NBC launched two separate broadcasting networks, the Red and the Blue, and created its advertising rate cards. Columbia Broadcasting Co. was launched in 1929 when its predecessor was acquired by William Paley.

The power of a single announcer to reach thousands of people was very attractive to product manufacturers and, therefore, to their agencies. By the end of 1921, approximately one out of every 500 U.S. households had a radio receiver. A half million were sold during a six-month period in 1922. By 1926, one in six households owned a receiver. The novelty of radio, however, began to wear off, and people began searching the dial for content. Radio began to resemble the telephone less and an entertainment medium more.

Station competitiveness truly spurred the commercialization of radio. WEAF was committed to beating rival WJZ in terms of talent and programming. To accomplish that goal, it moved to new offices and bought new equipment. To support those expenses, WEAF created a sales staff to promote the station to potential advertisers.

The new medium of radio presented ad agencies with creative challenges. The purely aural nature of radio brought a new emphasis to words, and initial radio ads were merely segments of airtime filled with promotional messages.

Some agencies experimented with creating programs devoted entirely to a product. However, by 1927 only 20% of radio programs had sponsors. As advertisers began supporting radio, programming picked up. Vaudeville acts, musical variety shows, song-and-dance teams and comedy acts were brought to the listener by sponsors such as Ever Ready Batteries ("The Ever Ready Battery Hour") and A&P grocery stores ("The A&P Gypsies").

Program sponsorships

By 1928, radio had developed into an advertising-supported medium and ad agencies became involved with the development of programs that fit the needs and interests of their clients.

Two ad agencies are considered the leaders in early radio advertising: Lord & Thomas and J. Walter Thompson Co. L&T produced the "Lucky Strike Show," which by 1935 evolved into "Your Hit Parade," as well as Pepsodent's "Amos 'n' Andy." JWT launched several musical variety hits, such as "The Fleischmann Yeast Hour," which featured Rudy Vallee.

Other agencies eventually jumped in and overtook L&T and JWT with radio success stories. Most prominent were Young & Rubicam, founded in 1923, and Batten, Barton, Durstine & Osborne.

The "tobacco wars," just getting under way at the beginning of the 1920s, also contributed to the development of radio advertising. From 1917 until the end of World War II, three major tobacco brands battled it out: Camel, Lucky Strike and Chesterfield. American Tobacco Co. hired Albert J. Lasker of L&T to give its Luckies the winning edge.

On the newly created Lucky Strike radio shows, listeners heard slogans ("Reach for a Lucky instead of a sweet," "So round, so firm, so fully packed, so free and easy on the draw") repeated after every song. American Tobacco spent lavishly to push Lucky Strike ahead of its rivals, and that ad spending also helped move L&T into the ranks of the major ad agencies in 1929, contributing 25% of the agency's $40 million in billings.

Radio advertising in the 1920s set the stage for what many consider to be radio's Golden Age—the 1930s—typified by that ever-popular program format, the soap opera.

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