Radio Broadcast Resources

Category: Paid Placement, Joint Venture

Summary & Overview

Commercial radio stations make most of their revenue selling “airtime” to advertisers. Of total media expenditures, radio accounts for 6.9%. Radio advertisements or “spots” are available when a business or service provides valuable consideration, usually cash, in exchange for the station airing their spot or mentioning them on air. The Federal Communications Commission, or FCC, established under the Communications Act of 1934,regulates commercial broadcasting, and the laws regarding radio advertisements remain relatively unchanged from the original Radio Act of 1927, enacted to deal with increasing problems of signal interference as more and more stations sprung up around the country.

Advertisers have a broad range of choices when it comes to the type and length of radio commercial message they air. With changes in the radio industry and better production technologies, the mode of commercial presentation has changed, and commercial advertisements can take on a wide range of forms. The two primary types of radio ads are “live reads” and produced spots.

Cousin to the ad-libbed commercial, live read refers to when a DJ reads an advertiser’s spot on the air, delivered from a fact sheet or from personal knowledge. It can also refer to when the DJ “endorses” the advertiser’s goods or services. The Radio Advertising Bureau defines an endorsement as: “A commercial in which the…program personality personally recommends an advertiser's product or service, often done live during the program.” Live read and endorsement are not synonymous. An endorsement takes the form of a personal recommendation by the DJ
to the listening audience, whereas a live read could simply be the DJ reading from a script.

Produced spots appear to be more common. A spot is ‘produced’ if the radio station or an advertising agency creates it for the client. Produced commercial formats include: straight read with sound effects/music in the background, dialogue, voiced by two or more personalities, monologue (where the voice talent portrays a character, as opposed to an announcer), and jingles. Studies show that the quality of the commercials is as important to listeners, generally, as the number of ads they hear.

Digital technology has improved in-house production capabilities and now enables stations not only to create spots more efficiently and quickly, but also allows for instantaneous transfer of the commercial from one station to another. Also, as a result of the trend towards consolidation in local markets, non-competing stations can easily exchange talent, thus increasing the diversity of voices available to local advertisers.
Additionally, radio advertisements are purchased either “locally” or “nationally”. National advertising refers to ads that run in several markets, such as those for chain stores. Radio advertising is typically sold either “directly”, where a business purchases the airtime directly from the radio station, or through an advertising agency that purchases the ad and produces the commercial for the business. When a client purchases spots directly from the station, most stations will produce a commercial for the advertiser at no charge. Advertisers can also go to independent
companies for production of their commercial message.

In general, most advertisers cannot use well-known, popular music in their advertisement, unless they have prior approval from the recording artist and are willing to pay royalty and use fees to the copyright holder each time the ad airs. Radio stations and independent production companies typically have “music banks” that will sound similar to popular music, enabling an advertiser to produce a spot that sounds as though it “belongs” on a particular station.

In terms of commercial content, some ads include a call to action, designed to elicit a response within a specified time period. A call-to-action allows an advertiser to measure and track listener’s response to their radio schedule. Examples of direct response advertising include asking listeners to call a certain business or phone number, log onto the business’ website or come by a certain location by a certain time. The more typical radio advertisement is the general ad that’s designed to let the listener know about a good, service, promotion or event.
A certification program for radio copywriters — the Certified Professional Commercial Copywriter — was created for the Radio Advertising Bureau by Dan O'Day.

Radio stations sell their airtime according to dayparts. Typically, a station’s daypart lineup will look something like the following: 6am-10am, 10am-3pm, 3pm-7pm, and 7pm- midnight. The spots running after midnight, from 12am-6am, are referred to as “overnights”. Though this schedule of dayparts can vary from station to station, most stations run similar daypart lineups and sell their advertisements accordingly. Drive times, or morning and evenings when people are commuting, are usually the most popular times of day and when each station has the most listeners. The “rates”, or what the station charges the advertiser, will reflect that.

Advertising rates can vary depending on the length of spot the advertisers elects to run. Although sixty second spots are the most common, stations also sell airtime in thirty, fifteen, ten and two second intervals.

Setup Time
Varies.

Ongoing Maintenance
Varies.

Cost
Varies.

Speed of Results
Quick.

Basic Use

Because radio advertising can be expensive many marketers don’t even consider it as a possible advertising avenue. As such, they are missing out on a tremendous opportunity because radio is a great way to build your business. The trick is to figure out how to capitalize on radio without putting your entire marketing budget in to one basket.

There are two easy ways to circumvent the cost of radio advertising. The first is through an advertising cooperative, also known as a “Co-op”, where a group of marketers combine their resources to purchase advertising on a radio station (or network of radio stations) and split the leads through a URL rotator system. The second is to enter into a Joint Venture arrangement with a radio station where they run your ad for free in exchange for a percentage of the revenue generated on each sale.

It’s quite easy with digital technology to record your own radio spot. Some stations may want to produce the spot with their on-air talent but it’s a good idea to have something ready to offer them, especially if you are negotiating a Joint Venture. We would advise you start with a 60 second spot. It goes without saying that a 60 second spot is just that: SIXTY SECONDS. Not 59 seconds and not 61 seconds. Not even 60 ½ seconds. Listen to what your local radio stations are airing and see what catches your attention. You want to surprise the listeners with something that will snap them out of their daze and capture their attention. One recent effective radio advertising campaign opened with nothing but laughing, almost like the DJ’s had accidentally left their mikes open during the commercial break. This grabbed the listener’s attention immediately because many initially thought the DJ’s had made a mistake and were now listening intently to find out what actually goes on in the studio during the commercial breaks. This particular campaign was wildly successful.

While there are many free recording options, one higher quality paid service is Audio Acrobat.
If you’re shopping your spot around to multiple stations it’s wise to set up a unique domain name for each radio station. Rather than re-record your spot with the unique domain name for every station, you can record it once and leave a gap of dead air called a “donut”, which is where the unique domain name will be dropped in.

Basic Action Steps

Radio Joint Venture

Because so many radio stations have unsold airtime these days, many stations are very open to sliding Joint Venture ads into their unsold space. This gives them the possibility of monetizing that space rather than filling it up with public service announcements or re-running other spots.

Station size does not matter and FM/AM does not matter.

When contacting stations, ask to speak with the Station Manager, the Sales Manager or the General Manager - in radio station hierarchy these are the only decision makers.

When you call ask first to speak with the Station Manager. Most likely the secretary or receptionist will aggressively screen the call. Simply provide your name and tell them “I’m interesting in doing some advertising with your station.” This will usually get you through immediately. If you do wind up in voicemail simply leave your name, your telephone number and tell them you’re interested in advertising on their station. You will absolutely get a return phone call as this is the lifeblood of their business.

When you speak with the Station Manager (or other top-level decision maker) simply ask them if they entertain any “PI” (“per inquiry”, which is radio lingo for a Joint Venture). If the station does not accept “PI”, simply thank them for their time and move on to the next station. Do not try to sell them or convince them! Roughly 30% to 40% of radio stations will accept “PI”.

If the station accepts “PI”, don’t explain anything. Simply tell the Manager “To save us both time, why don’t we do this: I’ll send you an email with the program, the proposal and my contact information. That way you can review it in your own time. If you believe it would be a good fit for your station, let me know.” Then send them an email containing a brief reminder of your conversation, provide them with access to The Presidential Group Website and attach the 60 second spot to the email so they can hear the commercial. Let them know you are requesting 30 to 40 spots a week and at least a 90 day agreement.

Keep in mind, most radio stations always have an excess inventory of air time, no matter what they tell you. With “PI”, the station can generate extra income by simply filling unsold airtime. Offer a 50% split with the station for every sale made as a result of the campaign.
Consider also requesting the same type of Joint Venture arrangement with a banner on their website and on any streaming services the station provides.

The email should be short and to the point.
Once you have reached an agreement with the radio station, put the terms in writing.
Pay the station the day you get paid! Either overnight them a check or drop it off at the station. Remember, you’re building a long-term relationship with the station as well as the Station Manager.

Tools & Resources
• Radio Locator – www.radio-locator.com
• PageSwirl – www.pageswirl.com (URL Rotator for Coops)
• Audio Acrobat – www.audioacrobat.com (professional quality audio and video recording and editing)

For questions about Radio, please send an email to resources@michaelwyrosdick.com with “Radio” in your subject line.