John Sykes, chairman and chief executive officer of Viacom-owned Infinity Broadcasting, said radio enjoys a big share of consumers' media consumption but only 8% of advertising revenues. He said it's time the industry spent more time showing advertisers radio advertising's benefits.
"Radio should be part of the marketing plan from the start," Sykes told the group of mostly radio station executives. His remarks opened Thursday's Kagan Radio Summit, a daylong conference on the radio industry held in midtown Manhattan. Radio executives also discussed the impact of the FCC's rules on media ownership on station deals; conditions in mid-size markets and the industry's ongoing desire to increase its market share in comparison to other media.
He nodded to Infinity's competitor, Clear Channel Communications, for their attempts to stimulate demand in radio with an upfront-like presentation held around the same time as the TV industry's showcases. Sykes said that he didn't think Clear Channel had the answer but there was something to the notion of planning that could be taken from that and the TV upfronts.
"Radio should be packaging its inventory and selling it ahead of time," Sykes said.
Sykes said he was a late convert to the power of radio, having spent most of his career in television. He was part of the team that launched MTV in the early 1980s and, before joining Infinity in March 2002, was president of VH1 and CMT for eight years. VH1 and CMT are part of the MTV Networks, which are owned by Viacom as well. Sykes said TV has been able to benefit not in ratings guarantees but in CPM increases shown in the strength of the networks' recent record-breaking upfronts.
"We have a great, undervalued medium and a great opportunity," Sykes said.
He said one of TV's great strengths is its ability to communicate value with all levels at agencies, not just the buyers that the radio industry know so well. He said that the radio industry should be talking to all levels at agencies, including planners and creatives. Sykes said that he understood that there weren't as many agency creative personnel working in radio but that resources should be given to develop them.
Sykes call for more efforts to increase market share seemed to impact the audience. David Kennedy, president and chief operating officer of Susquehanna Radio, which has stations coast-to-coast from San Francisco to Atlanta. Kennedy said that Susquehanna and other station groups were always promoting radio's value to advertisers and that it seems that advertisers are understanding it better now than ever before.
"That's the great opportunity for radio to continue to grab market share," Kennedy said.