Commentary

Radio: Wave Of The Future

by Caroline Krediet , February 18, 2009

You heard it here first: Radio is the wave of the future.

I'm in the minority on this one. All the buzz in advertising is over Facebook, Twitter and social media. Yet radio technology is burgeoning. The appointment audio of the podcast is catching on, and satellite radio, HD radio and streaming mobile radio are all gaining interest and audience. So, too, is Internet radio: according to research firm American Media Services, 38% of adults surveyed six months ago said they expected to listen to radio on the Internet at some point in the future; more recently, the figure was 48%.

Listening to President Obama's inauguration speech again on YouTube recently got me thinking about stirring orations. Because I'm a Brit, naturally Winston Churchill's 1940 "Fight them on the Beaches" speech to the House of Commons came to mind. Even today, when I listen to it via a scratchy YouTube recording, I am struck by radio's power as a storytelling medium. I can't help but wonder: In our visual age, have we lost the art of audio communication?

I've long been a believer in radio.

After nine years in this business (and 20-odd as an avid radio listener), some of my favorite effective brand communication has come over the airwaves. Sure, they've been jewels nestling in the swill of sales announcements for Bob's Discount Furniture and Joint-ritis, but they stand testament to the fact: It is possible to do really wonderful radio.

Many people tell me that radio is a dying medium. Certainly, it long ago ceded its top-dog status to TV--and just last year, according to Zenith Optimedia, was surpassed for the first time in the U.S. by the Internet in total media spend. Of the seven categories of major media, radio fell down a notch to the fifth-largest.

And it's not surprising to hear that radio has lost status with Americans in the past five years: A 2007 study by eMarketer revealed that only 17% of those polled call radio their most important medium, down from 26% in 2002. The Net, in contrast, has jumped in popularity as the most important medium, rising from 20% to 33% in the same time period.

True, radio is no match for the infinite utility of the Internet. But radio still has a purpose, and a following. Sixty-four percent of the U.S. population tunes in once a day, and 94% of adults tune in every week. That's a cumulative audience of 283 million weekly listeners. It may not be seen as essential, but it does seem to entertain a substantial majority of the population.

The good news in these tough economic times is that radio is relatively cheap to create and produce. Moreover, its short and simple production times allow brands to be opportunistic and flexible in their media buys--a noteworthy advantage over the more-than-four week production lead times of out-of-home, magazine and newsprint, and TV's eight-week minimum.

Most important, however, is that great radio work can have a huge impact. Best-in-class examples: Bud Light's Real Men of Genius, or CDP's Hamlet cigars. A 2005 study by research firms Millward Brown and IRI found that radio provided 49% better return-on-investment than TV. In recent years, numerous studies conducted by third parties prove that radio is more personally relevant, more persuasive and just as emotionally engaging as TV. Some particularly thorough researchers have gone so far as to use facial electromyography to track emotional response!

Radio as a medium is tailor-made to the challenges of our multi-tasking, ADD age. Consumers might be working, driving or gaming, but they can still listen. Acceptance of radio ads is higher than that of TV ads: 51% of the listeners queried by American Media Services claim they do not switch radio channels when commercials come on. I recently worked on Dos Equis' "Most Interesting Man in the World" campaign. In qualitative groups, my colleagues and I were shocked at how many respondents recalled lines from the radio--even more so than the TV.

With so much to offer marketers, where are the new opportunities for brand integration in radio programming? In the 21st century, radio and brands should have a more evolved relationship than "Prairie Home Companion" and Powdermilk Biscuits. Where are the custom sound skins on podcasts rather than the usual sponsorship messages? Why not bring real brand integration into programming content? Or savvy communications planning, where ads complement content?

"RadioLab," National Public Radio's show about curiosity, recently aired a segment that dealt with the results of an experiment conducted by Yale psychologists. Participants bumped into a lab assistant carrying books and a cup of coffee--who, when jarred, asked for help with the drink. With one group of participants, the assistant's coffee was cold. With the other, the coffee was hot. Curiously, those participants who held the cold cup were more likely to rate a hypothetical person they read about as being colder, less social and more selfish than the other group. So why didn't Nescafe or Starbucks sponsor the show?

There it is: Clinically proven to be entertaining and economical, innovative democratic and about as underleveraged as a medium can be in our frenzied multichannel universe. I may be in the minority on this one, but I do think that in today's economy, radio affords some of the juiciest creative opportunities, at a bargain price. A radio revival could be just the thing to beat the recession blues.

radio

10 comments about "Radio: Wave Of The Future".

Check to receive email when comments are posted.

Leo Kivijarv from PQ Media, February 18, 2009 at 8:54 a.m.
You were inaccurate in stating that a 2007 eMarketer study revealed that only 17% of those polled chose radio as most important. It was an Arbitron/Edison Media study that eMarketer quoted in one of its reports.
Reply

Brent Walker from Soundscapes, February 18, 2009 at 10:13 a.m.

All of us who talk about Radio and the power of Radio are experiencing dissonance right now over how "Radio" is defined. On the one hand, we talk about gloom and doom regarding radio, but this is all based on radio that is transmitted through the airwaves and received by radio receivers.

On the other hand, Radio as a content form--internet radio, podcasts, all forms of audio-only entertainment--is doing just fine. Our challenge is to redefine Radio and remove from its definition the need for an RF transmitter.

As an entertainment medium, audio-only content will always have a place. Let's begin referring to this (no matter the delivery vehicle) as Radio. People still listen, albeit on a different kind of receiver, and it's always going to be a strong marketing vehicle.

Rich Wilhelm from RaffertyWeiss Media, February 18, 2009 at 10:42 a.m.

There is nothing wrong with radio as an ad medium. Its the short-sighted owners of radio like ClearChannel, who program their awful gruel of sameness in 147 different markets. The unimaginitive, un-local, antisceptic programming has turned off the audiences. Radio will come back again with its incredible utility to be consumed. Just not as authored by those huge, dull media outfits with their faceless, 6-month managers banging their fists on the table. Radio will need to get small again to get larger later & become the FUN that it once was when it reflects the community & engages the audience.

Caroline Krediet from Taxi New York, February 18, 2009 at 11:11 a.m.

The two articles (yesterday's and today's) are not necessarily in opposition. We’re talking about different things. Erik Sass is pointing out a decline in financial value of the radio companies. While we’re arguing that there’s huge potential there, as a communications medium.

That said, all this means nothing if radio companies all go out of business. But we doubt that radio as a medium will die, though the current business model may change dramatically.

Sammy Simpson from Tune In - Ideas Worth Listening To, February 18, 2009 at 11:49 a.m.

Excellent Caroline, and I couldn't agree more. Everybody wants something, but the air is free. http://thetunein.ning.com/profiles/blogs/everybody-wants-something-but

Dave Martin from Media Arts & Sciences, February 18, 2009 at 12:44 p.m.

Bravos, Caroline. You have made an excellent case and your conclusion is spot on. Radio's incredible reach (a ubiquity without equal), intrinsic targeting capabilities, and capacity to deliver significant message frequency should be reason enough for savvy marketing folks to include radio in their media mix. But wait, there's more. Great radio creative, including examples you've cited, enjoys a strong competitive advantage - the unique power to engage the imagination. The most effective radio creative is evocative, it puts to work the full measure of radio's innate magic. Great radio creative employs a deep understanding, respect and appreciation of an important scientifically proven fact - the mind works by ear. Best of all, "the juiciest creative opportunities, at a bargain price" represents largely uncontested space; radio is a blank canvas ready to reward the craft of the inspired artiste and the serious marketer bent on game-changing innovation. Game on.

Pocket Radio from CSC, February 18, 2009 at 1:22 p.m.

"The appointment audio of the podcast is catching on, and satellite radio, HD radio and streaming mobile radio are all gaining interest and audience."

“Arbitron/Edison study chills the already thin air of HD Radio”

“All you need to know about this research is this: It says relatively few know about HD. It says that number hasn’t gone up. And it implies that folks are aware of what they care about, not vice versa. It also strongly suggests this isn’t going to change any time soon - as in, forever.”

http://www.hear2.com/2008/04/arbitronedison.html

Wrong! There is almsot zero consumer interest in this HD Radio farce:

http://hdradiofarce.blogspot.com

Pocket Radio from CSC, February 18, 2009 at 1:34 p.m.

"The appointment audio of the podcast is catching on, and satellite radio, HD radio and streaming mobile radio are all gaining interest and audience."

Satellite and HD Radio's business-models are broken - Satellite Radio is just another version of terrestrial radio (without the commercials) and new subscriptions have stalled. Actually, you will see subscribers pulling out of Satellite Radio, now that the companies have merged, and the quality of programming has suffered. Satellite Radio is billions in debt, and never really caught-on past the radio-geeks. In-dash Internet Radio will obsolete terrestrial, HD, and Satellite Radio. Terrestrial radio groups are over-leveraged, as radio properties have plummetted, and expect to see bankruptcies this year:

"Radio -- Bankrupt in 6 to 12 Months"

"Consolidated radio groups are facing bankruptcy because some will not be able to restructure their massive debt -- the debt they acquired in the first place when they paid too much for overvalued radio stations."

http://tinyurl.com/ba8zsp

Sorry, for the bad news.

Rod Schwartz from Grace Broadcast Sales, February 19, 2009 at 3:05 a.m.

Caroline - enjoyed your post. I share your optimism for Radio. This is what I wrote on January 21st (the links won't appear here, but can be followed at http://rodspots.blogspot.com)....

"2009 promises to be a challenging and eventful year for all of us in the radio ad business. Some broadcasters fear that the radio medium is becoming irrelevant in the digital age. Others, particularly in the small and medium markets, are thriving and optimistic. I prefer to throw in my lot with the latter group, believing (with a grateful nod to Mark Twain) that the reports of Radio's death are greatly exaggerated.

"Just ask Randy Miller in Illinois, whose stations continue to serve listeners and advertisers and grow each year. His approach to selling in a recession: "Ask for BIGGER DOLLARS and long-term business...[give] the client enough frequency to MAKE IT WORK." (Small Market Radio Newsletter, January 22, 2009)

"Or Wisconsin's innovative dynamo Roger Utnehmer, who early on recognized the potential of the Internet and made the investment necessary to harness it. His four local stations and companion website, Door County Daily News, now daily reap the benefits of their profitable synergism. Visit his online 'newspaper' to see how he does it.

"Then there's Jerry Papenfuss in Minnesota, whose Fergus Falls stations helped raise $55,000 to send their high school marching band to Washington, D.C. to march in the inauguration parade. Band members filed reports on their trip, aired by the stations for the folks back home. Think they left any sponsorships unsold?

"I spent five-and-a-half wonderful years selling radio advertising at Jerry's stations in Winona. When I started working for him in 1974, he was the relatively new owner of an AM/FM combo. Today he and his wife Pat own and operate all 5 stations in Winona, along with combos in Fergus Falls and Blue Earth, and he's as committed as ever to making a difference in the communities he serves.

"Broadcasters like Randy, Roger, and Jerry are the salt-of-the-earth of the Radio industry, and part of the backbone of the markets they serve. You're not likely to read about them in Radio Ink's '40 Most Powerful People in Radio' issue. Where you're more likely to find them is at their City Council meetings, serving on Chamber of Commerce committees, volunteering their time and effort in myriad community organizations. They're not looking for 'power,' only for ways to serve, to make a difference in the lives of their neighbors and fellow citizens.

"That is why they - and broadcasters like them in communities across the land - will continue to thrive and succeed. In any economy."

So, thanks again, Caroline. Put me down as a fan!

Charlie Ferguson, February 20, 2009 at 8:32 a.m.

To shove satellite radio and podcasts into the same envelope as Terrestrial Radio is a stretch. Satellite radio with it's dedicated receiver is as obselete as Muzak - the only difference being Muzak has already filed bankruptcy! Our stations are all streaming - because we have a duty to be where the audience is, when they want us. The key difference between "Real Radio" and the others is that only "Real Radio" will put people into stores to buy things - today! Each day we continue to prove that dollar for dollar - and time for time - Radio gets results equal to - or better than - any other media.