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Are retailers deaf to radio advertising’s potential?

Written by Tom Ryan

While retail budgets have been shifting toward digital advertising, a new study shows radio ads, on average, drive 22 percent traffic lift for retailers.

The study from TagStation, owner of the Dial Report radio measurement platform, analyzed 1.5 million radio spot plays for 10 brands in the top 100 U.S. markets, collecting listener data from April through June 2018. The study compared the consumer actions of listeners exposed to radio campaigns to those not exposed to evaluate the impact of radio advertising on average store visits.

Among categories, traffic lift saw the following increases:

  • Automotive: 32 percent
  • Beauty: 32 percent
  • QSR: 23 percent
  • Home Improvement: 7 percent

Higher average store visits were seen from listeners exposed to radio ads on Saturdays, Wednesdays and Mondays. Higher regular visits came from listeners exposed to radio ads on Top 40 and Adult Hits radio formats.

Several other recent studies likewise promote radio advertising’s healthy payback. Flexibility, high frequency and affordability are cited as benefits. The medium’s ability to reach a specific audience over and over again as well as deliver messages in vehicles just before the point of purchase are also called out.

According to the “2017 Audio Today Report” from Nielsen, “Marketers and brand managers are rediscovering radio. It's a mass medium that can deliver targetability and message frequency in markets large and small.” The study noted that AM/FM radio continues to be the top weekly reach medium, as 93 percent of the country tune in every week.

In a column for Adweek, Paul Brenner, Dial Report’s president, further noted that ROI attribution is vastly improving as consumers are using their mobile apps to tune in via smart devices.

Still, Magna’s just-updated U.S. Advertising Forecasts projects digital ad revenue will reach 51.5 percent of total ad sales in 2018. Radio’s market share is expected to be at 6.4 percent, with spending expected to erode 4.7 percent in both 2018 and 2019 due to declining local audiences and weak pricing.

Drawbacks to radio ads include lack of visuals, low attention-getting and ephemeral messaging. A major concern is losing younger listeners to streaming services like Spotify and podcasters.

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