Radio's Dying ... But The Cause Isn't What You Think
February 17, 2015
Every few months, we see another article with a headline that reads something along the lines of "New Study Shows that Radio Still Reaches Lots of People." Inevitably, these headlines contain words like "still" and "not yet." They boast not about radio's growth, but about the slowness of its decline. ("Good news everybody! The cancer is spreading slower than we thought!") And everybody breathes a sigh of relief and goes back to what they were doing.
Radio is not going to die because listeners abandon it.
It's going to die because advertisers do.
No doubt, an onslaught of radio executives will refute the above statement by pointing to reports of an uptick in recent radio advertising spends. And you will probably see those reports for a while as the economy improves.
But these reports are not indicative of the larger trend.
The larger trend is this: For companies, marketing is evolving from an art into a science.
The world once dominated by the creative genius of Don Draper and his ilk is giving way to a landscape full of data-driven strategists and analysts. Marketing and advertising has entered a brave new world. Concepts like "branding," "positioning," and "top of mind recall" are fading. In this new world, all that matters is ROI.
Return on Investment.
For every dollar my company spends on advertising, how will it perform in revenue?
There's a whole new array of marketing tools that have arisen to enable marketers and advertisers to answer these questions: website analytics, social media metrics, marketing automation, lead scoring, etc.
Here's an example of how it works:
A local concert promoter sells tickets through his website. He has tracking code installed on his webpages so he can see not only how much of his traffic comes from different online sources — Facebook, Twitter, Google, etc. — but also how many of his sales can be attributed to each source. In short, with a fair degree of accuracy, he can measure the ROI of each of his marketing channels.
But what if a company doesn't rely on online sales? There are still tools available to measure the ROI of their marketing efforts. Here's another example.
A local car dealership places ads on Facebook, Google, in the local paper, and on radio. Using a service like CallRail or CallFire, the dealership gives each traditional advertiser a different phone number for their ads. A snippet of code on the dealer's website can automatically determine where the visitor came from, and display a different phone number accordingly. This allows the dealership to see which marketing channel is driving the most incoming phone calls. Again, they can measure the ROI on their advertising spends.
Unfortunately, radio does not make it easy for its clients to measure the ROI on advertising. At best, the evidence of successful radio campaigns is anecdotal. We can't demonstrate the ROI of a radio advertising campaign the way people can with ads on Google, Facebook, Twitter, and Yelp!.
Radio salespeople often take a lot of flak from their colleagues on the programming side of the building. But what many people don't realize is that the job of a radio salesperson is getting harder as more and more clients start thinking about advertising as a science and not an art. As an industry, we simply aren't providing them with the tools they need to compete against these new mediums.
It's time to start.
Don't worry about radio losing its audience. Unless we, as an industry, embrace the importance of ROI in marketing, we'll lose our advertisers long before the audience goes anywhere.