Why Mary Meeker Kills Radio's Star

Speaking of real time, two interesting analyses passed my desktop this morning.

There was the most recent edition of Nielsen’s “Total Audience Report,” which shows that despite the shift to all things digital, radio still has about a 15% share of the time the average American spends connected to media throughout his or her day.

While that is notable in itself, it was the second analysis from GroupM’s Brian Wieser that made me think twice about the first statistic.

Using its still-impressive share of time spent with media, Wieser uses radio to knock down a popular thesis espoused by venture capitalist Mary Meeker — that the time people spend with media should correlate with the share of advertising dollars marketers invest in those media.

While Meeker has mainly used it to make a case for newfangled digital media — first desktop and now mobile — Wieser shoots it down, noting the connection between time and media is “coincidental” not “causal.”

“If time-money gaps correct themselves, what about radio?” he writes. “The time-as-a-driver-of-spending argument really falls apart in the weakness of investment in radio.”

According to Meeker’s analysis, radio has less than an 8% share of ad spending, which is nearly half of Nielsen’s current estimate for share of time spent connected with media, or about a third less than Meeker’s estimate of 12% of the time spent with all media.

Wieser explains that radio’s lower share reflects a variety of other secular factors influencing demand from advertisers, not the amount of time people spend listening to the medium.

Conversely, Meeker overinflates the ad value for digital media for a variety of reasons, including the fact that much of the time people spend on digital — especially mobile — is not even related to an advertising opportunity. (Remarkably, people still use their phones to communicate with other people, sometimes even talking to them.)

“The true driver of growth of advertising in any given medium is the emergence or decline of companies that are disproportionately likely to rely on that medium,” Wieser asserts. He notes it has been shifts in established marketers’ media strategies — and especially the rise of new endemic digital marketers — that have buoyed digital’s ad share growth in recent years, not the amount of time people spend with media.

4 comments about "Why Mary Meeker Kills Radio's Star".
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  1. Ed Papazian from Media Dynamics Inc, July 1, 2019 at 9:16 a.m.

    An even better example of the folly of equating time spent comprisons with advertiser media mix decisions is magazines. Even in their heyday---the 1940s and early 1950s----magazines, including the biggies--"Life", Look" and "The Saturday Evening Post"--- collectively garnered barely 20-25 minutes per day of claimed "reading" in time spent studies which, invariably showed radio and TV  with  2-3 hours apiece in daily usage.  Yet, these and many other magazines were at their zenith in both audience and ad support during those years. Meeker's harping on this aspect reflects both a lack of understanding about how branding advertisers really make their media decisions as well as it's blatent pandering to digital media ad sellers---who keep babbling about how advertisers need to follow the eyeballs, which, as we are constantly told, are deserting "legacy media" for the internet.

  2. dorothy higgins from Mediabrands WW, July 1, 2019 at 12:06 p.m.

    Equating time spent to advised ad dollars is simply quaint these days. 

  3. John Grono from GAP Research, July 1, 2019 at 8:57 p.m.

    I think desks are one of the most important of all.   I spend about half my day at a desk.   It is strongly correlated to all my purchases.   Not.

  4. Tony Jarvis from Olympic Media Consultancy, July 2, 2019 at 11:48 a.m.

    Dorothy:  You are far too polite.  John: You should have gone further? 
    That the Bond Partners behind this report did not pick up this egregious error is shameful.  As we are aware, based on delivering the most conducive parameters radio can be a powerful medium to drive brand sales or brand equity depending on the creative.  Radio's inclusion in the campaign's media mix has virtually nothing to to do with average time spent with radio per adult per day although it likely has a great deal to do with the propinquity of the ad delivery to an optimal time of day!  

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