Thoughts on Local Radio

By Bill Duggan

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Last week I had the opportunity to be a guest of the Beasley Media Group at its managers' meeting in Boston. Beasley owns and operates 63 stations in 15 large and mid-size markets and is the fourth largest radio company in the U.S. In preparation for the meeting, I reached out to members of the ANA Media Leadership Committee to get the advertiser POV on local radio, both positive and negative. Highlights follow.

DJ endorsements can be powerful

• "DJ live reads/endorsements have performed well."
• "We worked with a leading media company and the creative was executed with local hosts in their own personal style. Over 200 custom audio units were produced, talking about features in context of life events."
• "Marketers are increasingly interested in making authentic, emotional connections with audiences. In markets where there are longer commute times, the daily connectivity between the local DJ and his/her audience, particularly in rush hours, is an opportunity for marketers to make a meaningful connection. We have had success entrusting DJs to do live reads in their own words and with their own flair, on a number of high-profile initiatives and will continue to use that tactic moving forward. Local DJs can hit the marketplace like a sledge hammer through plate glass. You can't replicate in any other medium the combination of someone who lives in the same market as the audience speaking to that audience in their own vernacular and own words that offers the reach of radio."

Radio delivers advertising messaging in context

• "What it provides is precision. I know that a lot of cravings for our products happen in the afternoon around drive time. Say I could get some on-air radio mentions to remind people to just pick up my product on the way home. That could be interesting."
• "Since radio listening often takes place in a car, that provides a perfect opportunity to reach listeners about car insurance," according to an insurance company member.

To supplement national media

• "Local radio allows us to be heard in the markets that matter to us. Most of the time, it has been an overlay to our national programming."
• "We like radio as heavy-up medium in key markets."
• "Can be used for a national launch to be highly geo-targeted due to regional concentrations of opportunity."

Retailers and local dealers

• "Radio remotes are valuable to our retail partners in delivering sales."
• "Local radio is important to our dealer network."

Critiques that stand out

• "One of the challenges we have with local radio is it hasn't performed well in our marketing mix modelling. So it doesn't get a lot of support from the brand teams."
• "I think a challenge with local radio is it doesn't get the creative attention it needs to be effective. You have to make it a priority to get better creative and then better ROI results."
• "For a company like ours, what I need is scale. Local radio just doesn't give that to me."

Not mentioned by ANA members in my outreach (recognizing the small base) were the following topics of relevance:

• Podcasts: According to the IAB's "Full Year 2017 Podcast Ad Revenue Study" (June 2018), podcast advertising revenue, while still small, is exploding. It was estimated to be about $300 million in 2017, up 86 percent versus year ago. By 2020, the market is estimated to be $660 million. Further, about two-thirds of the ad revenue is via host-read ads — nice synergy with the power of DJ endorsements for local radio.
• In-House: The ANA continues to see growth of in-house agencies among marketers. Some of those in-house agencies are handling creative for radio and some have a role with media for radio.
• Digital: Terrestrial radio is free of the issues that hover over digital advertising, including ad fraud, non-viewability of ads, and the "tech tax." Yet digital is a promise for local radio and many of the radio companies, including Beasley, look for digital advertising revenue to increase in importance.

Thanks to ANA members for their insight on local radio and thanks to the Beasley Media Group for including me in their event.

Bill Duggan is a group EVP at the ANA.