Author: Paul Heine, Managing Editor of InsideRadio
Original Publication: InsideRadio
Date Published: December 3, 2018
A BIA survey of 1,500 local advertisers found customer-engagement benchmarks and expected ROI are the biggest determining factors in where they invest their marketing dollars. Among radio advertisers, expected ROI came in first (40%), followed by customer-engagement benchmarks (39%), business conditions (38.2%), expected revenues (37.8%) and money left after other expenses are paid (33.7%).
The results underscore the importance of radio industry efforts to provide greater attribution and ROI info to advertisers, a central theme of this year’s Radio Show conference in September. “Attribution is critical to developing good ROI analytics,” BIA managing director Rick Ducey told Inside Radio. Showing that radio’s embrace of data and analytics is gaining traction, “radio is in the top half of media when it comes to ROI,” Ducey said, beating out both TV and cable. Four in ten surveyed advertisers that use radio said it delivers “excellent” (10x times) or “extraordinary” (20+ times) ROI, while 53% rated it as “fair” (2-4 times) or “good” (5-9 times).
Speaking on a BIA webinar last week, Jessica Hawthorne-Castro, CEO of Hawthorne Advertising in Los Angeles, said she finds it critical to show accountability to her clients. But attribution isn’t necessarily a single thing, she said, it maps back to client strategies and goals and what they are trying to accomplish in their campaign. Hawthorne-Castro also made the point that brand campaigns will have different KPIs (key performance indicators) than engagement campaigns.
Spanning both proprietary company initiatives and partnerships with third party providers, iHeartMedia, Entercom, Cumulus Media, Beasley, Emmis and others in the radio space are tapping rich datasets across the life cycle of ad campaigns, from planning through activation and optimization to post-campaign analytics to illustrate the impact on client objectives. Some broadcasters have partnered with firms like Analytic Owl, Veritone and Futuri to show clients which piece of copy, dayparts and stations trigger the most visitors to client websites. “The media business has begun embracing data and data science, and that’s a good thing,” Ducey said. “There are many benefits from adding data-driven inputs to creative decision making such as copy analytics.” Such tools can improve campaign performance and ramp up audience engagement.
But meeting client objectives nowadays involves more than just providing audience tonnage. “The game should not be about getting the biggest audiences but the right audiences and to get them engaged,” Ducey said. “Clients are getting smarter about this and happily media companies are too.” For example, tools that allow advertisers to compare the outcome of different creative may show one piece of copy delivered the most website traffic while another drove a higher performance inside the target audience.
Traditional Media Gets 65% Of Local Budgets
Overall local media spending is projected to grow 1.9% to $145.8 billion in 2019, according to BIA Advisory Services. But the mix of local advertising dollars will continue to shift. Traditional media is expected to capture 65% of local ad dollars this year, but BIA estimates that will slip to 62% next year. “Clearly, advertisers are becoming much more interested in activating digital media,” Ducey said.
Yet as a majority of ad dollars are still placed with offline media, and while traditional budgets may be “softening,” a still-significant amount is going to radio, TV, print and outdoor.
“Traditional [media] clearly has a strong role, but digital also has an increasingly important, if somewhat confused, role as people are still trying to figure it out,” Ducey said.
Hawthorne-Castro said there’s a “push and pull” between all campaigns. “We’re always looking at offline and online media, TV, radio, outdoor, everything working together to be able to drive that consumer,” she said.
Hawthorne-Castro said what she’s looking for from media vendors are sales reps who “are easy to communicate with, easy to get ahold of.” But more importantly, she said, is a realization that the agency buyers and media sales reps are really on the same team. “We always have the client’s greater good in mind and helping them grow their business,” she said.