Opportunities for Selling More Radio Ads Still Out There

At RAB: AT&T, Coca-Cola Share Tips on How to Get Their Dollars

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ORLANDO, Fla. (AdAge.com) -- Radio companies may be seeing double-digit losses in ad revenue each quarter due to the collapse of the automotive industry and slowing sales at retail, but there are still untapped sources of marketing dollars available to those that retool the way they sell.

At the Radio Advertising Bureau Conference here, senior marketing executives from AT&T, Coca-Cola and MillerCoors, as well as veteran radio-ad sellers, spoke of new-business opportunities for radio, both in upcoming product launches and existing brands with low-priority budgets behind them. In a panel titled "Revenue Opportunities Abound With Aggressive '09 Spenders," Sheila Kirby, senior VP at Tribune365 and a veteran of radio rep firm Interep, said radio sellers need to change the conversation with their local advertising partners.

"We need to be relevant not only in our own companies but most importantly with the advertisers and agencies we do business with," she said. "If you think you are personally challenged in your jobs and your lives, the person sitting next to you, the car dealer, the guy who owns the retail store, the dry cleaner, the guy who works for Microsoft are more challenged than you. They don't know how to be relevant to their customers, and radio is an absolute opportunity to do that -- engage consumers in a meaningful way."

Still significant auto business
As a result of a more transaction-based selling approach, radio is still seeing significant business from the automotive category, with strong sales at Hyundai and companies with certified pre-owned vehicles such as BMW, Audi and Mercedes-Benz, as well as the soon-to-launch Toyota Venza. Fast food is also a growing category for radio, particularly as Tim Horton's and Cold Stone Creamery create co-branded stores in 100 markets to compete with Dunkin' Donuts, and McDonald's preps the refitting of all its franchisee locations to include McCafe stations.

"It's incredible how much business is out there," said Susan Novicki, president of Boston-based radio rep firm Morrison and Abraham. "You just have to find the right decision makers in each company."

Even the industry's top media buyers can't ultimately activate major brand dollar shifts to radio. "The buyer is already executing a plan that was already put in place by the client," said Kim Vasey, senior VP-radio director for WPP's Mediaedge:cia. "Unless you're getting in front of these people, you're already missing out on half the battle."

Smaller brands lost in the shuffle
That's true for MillerCoors, which has so many brands in its portfolio that some simply don't have the time to create dedicated radio marketing plans. Dockery Clark, exec VP-sports and event marketing for MillerCoors, said marketing dollars for smaller beer brands such as Foster's can get lost in the shuffle if radio companies aren't presenting them with compelling opportunities.

"We have a lot of brands who want to spend money and have budgeted money locally to do programs that can't get the time of day of even our distributors to even build a program," she said in an advertiser-spotlight panel on MillerCoors. "For solutions-based selling, brands like Foster's will put a lot of money out there locally, but because it's not the biggest volume driver, a lot of times they turn the money back in to corporate. If you can make a turn-key solution for somebody like [a regional marketing manager] who doesn't have a lot of time to work on it, you might get some of that Foster's money."

There are other big-spending marketers, such as AT&T, the country's No. 2 advertiser, which still has something resembling an experimental budget -- a rare thing in these recessionary times -- and is turning to streaming radio, text messaging and other digital extensions as a place to spend those dollars. Chris Schembri, AT&T's VP-media services, said ever since text passed voice in terms of data usage on AT&T phones in the last quarter of 2007, the company has accelerated its efforts to reach mobile consumers.

"Radio will always have a place within our media mix, but the challenge will be to keep it innovative enough for us to socialize the value of radio within our media mix," Mr. Schembri said. "What I'm really looking forward to are seeing some really good ideas from the radio groups to connect technology with our brands."

Leveraging partnerships
The same goes for Coca-Cola, which spends $30 million, or 10%, of its annual marketing budget on radio and is constantly looking to its regional radio partners to help leverage their partnerships with theme parks, sports leagues, and local retail and restaurant vendors.

"The power of radio for me is all about storytelling -- you do it better than anyone. How can you connect our brands to that story?" said Annis Lyles, Coca-Cola's VP-media and interactive. "We truly believe we are a local business, and it's very important for us to understand the local market nuances. At the same time, we want to differentiate ourselves from our competitors. At the end of the day, folks have only so much discretionary income, and you want them to go pick up a Coke."

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