• by Frank Saxe , January 13, 2003

In a move that may force a number of radio networks to subscribe to the RADAR ratings service, WPP Group’s MindShare says it will withhold the estimated $60 million it spends annually on network radio from any syndicator that does not place at least some of its programming into RADAR’s tight measurement by the end of the year.

“This is the last year that we will buy time on a network that doesn’t have at least something in RADAR,” says MindShare senior partner/group director Reyn Leutz. Speaking from Chicago, Leutz outlined the policy to MDN, explaining that there has been increasing frustration with syndicators that have resisted. “We feel this is it, we’re finished with those that won’t.”

MindShare handles media for J. Walter Thompson Co., Young & Rubicam and Ogilvy & Mather Worldwide along with sister media firm Mediaedge:CIA. It buys network radio for advertisers including Sears, Gillette, and the U.S. Marine Corp. Although he is a longtime fan of RADAR and the strict scrutiny it applies to commercial clearances, recent changes at the advertiser level have forced the dictate. “Clients are getting nervous,” says Leutz. “They’re looking for proof of where things are airing.”

Proof is what RADAR provides. RADAR, Radio’s All Dimension Audience Research, is a national radio ratings service that measures audiences to radio commercials. It has long been a “gold seal” for ad buyers, since unlike most ratings services it measures the audience of the commercial – not the program. Because it requires reams of information from the program supplier about exactly which spots aired at which times and on which stations, its been both a paperwork nightmare and a cash generator, since advertisers have rewarded radio networks that are measured by RADAR with a typical 25% premium.

Leutz views a network that lays out the thousands of dollars to subscribe to RADAR and has a backroom operation capable of tracking clearances as essential. “It is a sign that they really care about the numbers. We’re not saying that they need to put everything in RADAR, but they have to put something in as a step for them to prove to everyone that they have a good backroom and that they have good clearances.” He points to estimates that as much as 25% of network radio commercials do not air at the time an advertisers has purchased.

The largest networks, owned by media giants like Viacom, ABC and Clear Channel, are already paying for RADAR. It is the second-tier syndicators, who are already being squeezed by consolidation, that will be most impacted by MindShare’s policy. “Everyone has to look at how much business they get from a shop, how much it would cost to subscribe to RADAR, and what they have that could go in,” says Jones Radio Networks CEO Ron Hartenbaum. His network is in negotiations with Arbitron to become a subscriber.

United Stations Radio Network must also decide whether to spend the several hundred thousands of dollars it will take to subscribe to RADAR for the opportunity to get in on a MindShare buy. “We are in the middle of lengthy dealings and recent meetings with Arbitron,” says United Stations executive VP/general manager Jim Higgins, adding they are still working the numbers to determine whether it is worth it for them.

Leutz concedes it will cost programmers money to subscribe to RADAR, and says he is willing to reward those that do with additional ad buys. “I’m willing to pay if I know where the commercial is airing. It’s about the quality of the numbers.”

Salem Radio Networks, a religious programmer that has seen some of its fastest growth in its secular, conservative talk segment, is hoping its audience’s other assets will attract ad dollars. “I would hope that MindShare’s decision is not the beginning of a trend,” says SRN president Greg Anderson. “I am not for a moment disputing the value of RADAR. What I disagree with is decision based exclusively with that. There are number of criteria that go into making a good advertising decision.” Anderson says “niche programmers” like SRN give buyers other options, although he says they are also evaluating subscribing to RADAR.

Although he says the policy does not carry a “zero tolerance,” Leutz downplays the notion that MindShare clients could miss out on key listener groups. “There’s nothing that I will miss out on,” he insists, pointing out there are three dozen rated-networks from which to choose. That number is expected to increase in the coming months. In the past few years the network radio business has doubled, to account for $1 billion in revenues annually. That said eight of every ten dollars spent on radio is still bought from a specific station in a local market.