Clutter, clutter everywhere
But neither listeners nor ad agencies are tuning out of radio—yet
By Elizabeth A. Rathbun -- Broadcasting & Cable, 8/27/2000 8:00:00 PM
It's a well-known industry "secret" that many radio stations are carrying more advertising than they did in the not-so-distant past. Still a mystery, however, is when commercials become clutter and start turning off listeners.
Increased advertising on the radio "certainly is something we are starting to pay attention to," says Julie Pahutski, senior vice president of Cincinnati-based Empower MediaMarketing, which plans and buys advertising. But she has heard no complaints from her clients, mostly retailers. "It's more of an awareness thing at this point," she says.
There is awareness that listeners are hearing more ads on the radio. Historically, music stations have averaged eight-10 minutes per hour, according to various sources. Now they run some 10-12 minutes per hour. The news, talk and sports formats, which are considered more advertising-compatible, have been clocked at up to 20 minutes per hour.
It's not just radio that is increasingly cluttered. Studies show that other forms of media are carrying more ads, including broadcast TV, cable and the Internet. But in the radio industry, the issue has been subject to more speculation than fact, partly because there are some 10,500 commercial radio stations across the United States. Compiling independent data on how many ads each carries per hour is a daunting task.
But a few have taken on the challenge. Empower, charting paid ads of 30 seconds or longer per hour on 266 stations, found an overall increase of 6% between 1998 and 99. The biggest gain-20%-was in San Francisco (see chart).
"There's absolutely no question that inventory is at full demand right now," says Gary Fries, president of the Radio Advertising Bureau.
But a 6% overall gain as reported by Empower in April is "a non-issue," says Ralph Guild, president of the rep firm Interep. On a talk station that runs 18-20 minutes of ads an hour, for example, 6% doesn't even add up to one spot, he says. "The real measurement of clutter is what goes on inside the brain of the listener."
And what's going on in there? While overall "time spent listening" (TSL) to radio decreased 9% between spring 1993 and winter 1999, or about two hours per week, "this erosion ... cannot be explained by the most recent increases in commercials," according to a June 1999 study by Arbitron Co. and Edison Media Research. Rather, the study posits, TSL is down for reasons including "increased demands on people's time and the proliferation of new media."
Another reason cited for the decline is the passage of the Telecommunications Act of 1996, which allowed broadcasters to own up to eight stations in the nation's largest markets and an unlimited number of AMs and FMs nationwide.
In order to grow rapidly to the new caps, many companies tapped investor dollars and "there's no question that the public companies demand more performance on a continual basis" than do private companies, Fries says. In other words, they need money to pay the big prices they paid for their new stations.
Among the companies known to have increased advertising since 1996 are Infinity Broadcasting Corp. (owned by CBS Corp., which is now owned by Viacom Inc.), Clear Channel Communications and AMFM (which is currently merging into Clear Channel). Cox Radio has held the line and is touting that fact in its markets.
While there is no formula for what constitutes too much clutter-it seems to depend largely on a station's format and the market-"the ratings are going to ultimately give you a report card," Fries says. "In some cases," he notes, there may be room for even more ads per hour because consumers are growing inured to advertising all across society.
While a few ad agencies have "voiced a concern" that radio is getting too cluttered, Fries says he has heard no "general complaint."
Indeed, dollars spent on radio advertising increases month after month. June was the 94th consecutive month-that's nearly eight years-of radio revenue growth, RAB reported Aug. 2.
However, increased advertising "is not a long-term solution to gaining ad revenue," warns Natalie Swed Stone, managing partner/director, national radio services for ad agency OMD USA. If listeners get turned off, they will turn to new media such as satellite radio. And "we don't want to start people getting comfortable with going [elsewhere]," she says.
The double-digit five
| Market | Increase 1998-99 |
|---|---|
|
San Francisco/San Jose |
20% |
|
Miami/Fort Lauderdale |
16% |
|
Detroit |
12% |
|
Chicago |
11% |
|
Philadelphia |
11% |
|
SOURCE: Empower, using Nielsen Monitor Plus data |
Radio stations in five of the 16 markets studied showed double-digit growth in the amount of advertising and promos aired.
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