Know Thine Enemy: How radio, cable, and broadcast television sell advertising

Know your competitors to beat them at their own game. At the recent American Press Institute seminar, "Advertising Leadership for Community Markets," Ed Baron, CEO of Ed Baron Associates, presented the truth behind the numbers radio, cable, and broadcast TV use to sell ads. He also evaluated each medium on frequency, reach, efficiency, environment, and behavior. Baron showed seminar attendees that focusing on value rather than price gives newspapers an unbeatable advantage over every other medium.

Radio:
Baron says radio metrics overestimate the number of actual listeners by measuring market share as a percentage of total actual radio audience as opposed to a percentage of all possible audience. In addition, radio audience includes all listeners above the age of 12 whereas newspaper readership numbers usually only include adults 18 and over. Even including teens, radio penetration rarely surpasses 25 percent of all listeners and only during the morning commute. Radio listenership is measured by the average quarter hour, and Baron suggests comparing that with the average commute time in a market. In the metro Richmond area, for example, the average commute is 24 minutes. This makes drive-time radio a poor medium for reach.

On the other hand, radio is a good medium for frequency and efficiency because it allows an advertiser to repeat the same message many times to a specific target audience. For example, an auto dealer who wants to sell extra Ford Focuses knows to buy radio spots on a Top 40 radio station as opposed to a smooth jazz radio station
However, the power of the repetition is often offset by the poor environment in which the spots are played and radio's inability to drive consumer behavior. Because most people multitask while listening to the radio, listeners are not looking for product information. As Baron says, "you're not going to turn around in the car when you hear a furniture store ad." Newspaper readers, however, often scan newspapers for ads and then actively use the information.

The advent of satellite radio has also made it easier for audiences to eliminate unwanted advertising.

Mistakes your customers might make:

• Buying the wrong stations and reaching the wrong audience


• Buying too many or too few stations


• Buying too few or too many spots

Create "reasonable doubt" in your advertiser's mind by asking these questions about his or her radio buy:

• Are the listeners of those stations your best customers?


• How big is the station's total audience outside morning drive?

How will you broaden reach while radio builds frequency?

Cable:

Baron stresses the fact that cable is not broadcast TV. Indeed, cable is closer to radio in terms of reach and frequency. With its myriad channels, cable, like radio, provides efficiency and repetition, but in a poor environment against many competitors.

First of all, Baron says the audience is not what most advertisers expect. National audience statistics used by cable salespeople exclude dish subscribers. Barons says that this means roughly four in 10 households are excluded from the local cable advertising audience. Cable companies also count as a "subscriber" anyone who purchases any cable service, including Internet. Cable packages come in many "tiers" consisting of various combinations of channels and services. Cable companies are reluctant to disclose the exact numbers of households on each programming tier.

Furthermore, those who have cable are not always watching cable. According to November 2005's Nielsen reports, ESPN had the highest cable market share of adults 18-49 during primetime, at 1.14%. Equally surprising, two of the top five cable shows for the week of May 8-14, 2006, were children's shows on Nickelodeon. Baron's rule of thumb for advertisers is that "if you've heard of the TV show, you're not on it." In other words, local advertisers do not get the best spots, including on prime time network shows.

Cable, like radio, also presents ads in a poor environment. "Television advertisers are competing against the sofa," says Ed Baron. First, he says, people are not looking for ad information when unwinding after a day of work. And second, the pervasiveness of channel surfing proves that people actively avoid commercials when they want to relax.

Like radio, cable also suffers from the effects of new technology. Satellite TV owners don't see any local advertising. TiVo users can bypass advertising altogether.

Mistakes Your Customer Might Make:

• Buying too many networks with small or inappropriate audiences


• Confusing the medium with TV


• Poorly-executed creative with excessive repetition

Create "reasonable doubt" in your advertisers by asking these questions about their cable buy:

• Which cable networks have a significant local audience?


• How will you reach people with satellite dishes?


• How will you reach people watching network TV?

Broadcast Television:

The high price but wide availability of network television makes it a good reach, but poor frequency, medium - the opposite of radio and cable. But like radio and cable, broadcast television advertising is presented in a poor environment.

Broadcast television audience is declining. Despite the misleading high costs of television advertising during the Super Bowl - $83,000 a second - more Americans will read a newspaper than watch football on Super Bowl Sunday. The audience that remains has different demographics than many advertisers would expect: It skews older and consists of households with average or below-average income and education.

Many local advertisers who buy network TV are not getting what they think. Television, sold by time of day, breaks down portions of the broadcast day into five periods: early morning, daytime, prime, late news, and late night. However, what some television networks call "late night" is actually 12 am to 5 am, more commonly known as the middle of the night to most audiences. Most local advertising shows up during periods of the day when few people watch television.

Broadcast is also sold by designated market area (DMA), an exclusive, but large, geographic area of counties in which the home market television stations hold a dominance of total hours viewed. Because advertisers need to purchase by DMA, television is unsuitable for local advertisers.

Mistakes your customers might make:

• Not buying enough frequency to be noticed in the clutter


• Buying the entire designated market area when they need a more focused area


• Not targeting the right audience with enough "creative horsepower"

Create "reasonable doubt" in your advertisers by asking these questions about their broadcast television buy:

• Do you need the high cost to reach your best customers?


• Will you have enough frequency and creative weight to be noticed?


• How will customers get the details they need?

What are radio, cable, and television's strengths and weaknesses?