Is Advertising on Radio Still Profitable?
Radio is one of the cornerstones of the American entertainment market. According to Nielsen Ratings, radio reached 93% of American adults on a weekly basis in 2018. That’s millions of people who listen to the radio. They listen on their commutes to and from work, while they work, or while they’re around the house. So how do you tap into that kind of market potential? How does advertising on radio work? Well, this blog will attempt to tackle the lasting importance of advertising on radio.
The first question we must ask, is advertising on radio still an effective way of increasing sales? This is a hard thing to quantify and varies from city to city, but the short answer is yes, it is. A longer answer would be that in 2017 a New York radio station called Westwood One partnered with Nielsen Catalina Solutions to try and quantify the profits of a personal care brand’s radio campaign. The study showed, that a radio campaign ran from March 2017 to September 2017 brought an 8% sales to boost among male AM/FM listening households. The study showed for every $1 spent on AM/FM radio advertising for the male care brand, there was a return of $1.23 and parent brand saw a return of $11.96. Based on this study, it’s safe to say that radio advertising is still alive and thriving in the world.
So, what do you need to know before you start your advertising campaign? Let’s take a look at ad space.
Buying Ad Space
In advertising on radio, “when” you advertise is almost as, if not more, important than “how” you do it. Choosing consistent times to broadcast is a crucial part of building a consistent listener base to sell your product. Repetition is one of the most important parts of radio advertising. How often your ad plays, and when and where you play it is also something that can affect how successful your campaign is.
Ad spots are broken down into 15, 30, and 45-second-long commercials, and radio stations have an inventory of 18 minutes every hour for advertisements.
Radio ad times are broken down into day-parts, not into hours. The parts are:
AM Drive Time (6 AM to 10 AM)
- AM drive time is one of the two most heavily trafficked times on radio times. That makes it one of the two most desirable times to play your ad. This is the morning rush hours, when people are driving into work, and gives you the largest number of listeners. People tend to be the most receptive during the morning drive. All this makes this time one of the most expensive times to buy radio spots, along with its afternoon counterpart.
Midday (10 AM to 3 PM)
- Many radio stations tend to lose listeners at this time, as everyone is getting out of their cars and heading into work. This is also the time when people listening has the most predictable habits. Listeners here tend to more loyal to certain radio stations or shows, making a conscious choice of turning on the radio while not in their car. Popular talk radio shows like Rush Limbaugh also happen during this time. While this time may not have the most listeners compared to other points in the day, listeners here tend to be more engaged and a good ad can effective here.
PM Drive Time (3 PM to 7 PM)
- Like its morning counterpart, evening rush hour corresponds with some of the highest numbers of listeners as people drive home from work. This day-part is very desirable, especially for restaurants and entertainment advertisements as people look for ways to spend their night and suffer from choice fatigue. This slot also tends to be expensive for ad rates.
Evening (7 PM to Midnight) and Late Night (Midnight to 6 AM)
- These two slots have the lowest number of average listeners as most people are not in their cars, and television is a more popular form of entertainment during these time slots. While listener numbers might be low during these slots, those listeners tend to be the most loyal, as they’ve made an effort to listen to the radio as their nightly entertainment instead of watching TV or other forms of entertainment. Rates for advertisement can be low during this time, and if the market is right for your product, it could be a very important impact on your sales.
Writing the Ad
Writing an Ad for radio can be a daunting task, and further producing it can be even more so. Here are some tips:
- Make sure your ad gets people’s attention. Make sure your ad is well written and attention-getting.
- Hiring a professional voice actor is one way to get a voice that really gets your attention
- Get your point across in one or two simple, powerful and easily conveyed messages. You have less than a minute to sell your product.
- Have a Call to action. Give the listener a reason to go out and get your product right now. Have a special limited offer that runs out in x number of days to incentivize the listener to make a purchase soon.
- Clearly, state the next step the listener takes. If you have a brick and mortar store, give them a location. If you have a website, then give them the URL. While you have their attention, use it to tell them where to go. Most radio listeners are already driving, so tell them where to go next for whatever solution you’re selling them
- Have plenty of repetition. As stated above, repetition is an essential part of any successful radio advertisement. Repetition of the product within the ad really solidifies said product in the listeners head. Repetition, and consistency, of when, what station, and what ad you run is vital to selling your product. Research suggests that at least 15 ads be played in a week. If you do a short run of 60 ads or so, having that ad appear at the same time will give you the best results
- Hiring an ad agency with professional writers could be extremely helpful here. An agency is there to make every piece of information as easily digestible as possible for the consumer. Agencies know how to write an ad with all the features crucial to making a successful broadcast. You can also make the add whatever you want when going through an agency.
Choosing what radio stations you broadcast your ad on is important, as not all radio stations are created equal. Each station has a certain demographic that it mostly caters too. Businesses should be cognizant of those demographics and their own target audiences, choosing stations that best fit. If you’re advertising for a nursing home, then pop hits might not be the best choice of stations. Follow the statistics for the best results:
- Country music is the most popular kind of radio station and receives the largest number of average listeners in the US
- Talk radio, including news, sports, etc. is the #2 type of radio station. It attracts a larger number of high-income and highly educated individuals.
- 70% of males in the 45-54 age demographic listen to Classic Rock Radio stations but only reaches the #4 spot overall for male listeners
- Over 72 million people listen to Contemporary Pop at least once per week.
Remember, you’re not buying a commercial to sell your product, you’re buying an audience to sell your product to.
Advertising on radio allows you to organically spread your message to many people without much effort on your part. Anyone listening to your ad, whether it be while driving in a car to or from work, or while working in their yard using radio as background music, will hear and subconsciously store your product in their mind. You don’t need to encourage engagement either since engagement is an inherent part of the radio. Your product will spread just by the fact that it’s on the radio.
Advertising on radio is far from dead. In fact, it reaches millions of people on a weekly basis. Radio gives you an audience to sell to, all you have to do is make the pitch. Be sure to follow the tips above, do your own research. You can contact us here if you want to start your radio campaign now.