Radio and television
Television
Since its introduction in the late 1940s, television has been widely accepted into Americans’ homes as a source of news, information, and entertainment.
Light television viewers are a difficult demographic to reach, a serious concern given this group is characterized as being younger, more active, and more affluent than the general population. Television’s combination of sight, sound, and motion make it a formidable advertising medium.
Today, many viewers consume a limited amount of television while digital video recorders (DVRs) have shifted habits toward ad avoidance. Light television viewers comprise 40 percent of the total television audience, spending less than 90 minutes per day watching TV between the hours of 6:00 AM and midnight.
Big market stations remain critical to broadcast networks, despite an increasing reliance on digital and online content distribution. For dozens of major independent station group owners, local television is their core business and revenue source. With broadcast networks selling programs directly to cable and new digital media outlets, and as broadcast networks rely more on online sites, digital platforms and devices to distribute programs, local stations have faced a dilution of the affiliate brand.
The high capital cost, declining revenues, and tighter margins have become increasingly apparent among television stations. Local TV station owners are under pressure to modify high-cost legacy structures, leverage their unique local content and connections, and engage in new digital enterprises to collectively offset traditional ad declines.
Television Benefits
• Wide geographic coverage
• Broad audience reach
• Perceived accountability with well accepted audience measurement metrics
• Relative ease of buying and post-buy maintenance
• Proven success record for promoting mass consumer products
Television Disadvantages
• Audience share is generally declining due to fragmented audiences
• Increasing use of DVRs diminishes the impact of commercials
• Many television shows skew older and lower income
• Typically high CPM costs and rising production costs
• Primetime is no longer the preeminent reach builder with a large part of the viewing population not substantially reached by the primetime networks
• Increasing ad clutter as commercial pods lengthen
Broadcast Television and Out of Home
Out of home reinforces television messages when viewers are away from their homes during the course of daily activities.
Out of home minimizes wasted coverage and improves an advertiser’s campaign by providing the ability to target ad messages geographically.
Television is expensive. Out of home improves the efficiency of a television campaign buy by driving down CPM costs.Out of home reaches light TV viewers who are younger, mobile, and more affluent than heavy TV viewers.
Cable Television
In 1980, cable viewing was minimal compared to network television viewing. Today, cable television offers considerably more targeting capabilities than broadcast television, allowing advertisers to reach specific consumer groups according to their programming interests and preferences. The average cable home has access to 120 channels with nearly 3,000 programs available each week.
The cable industry faces new challenges. The growth in available channels and programming has lead to unprecedented broadcast audience fragmentation making it increasingly difficult for brands to effectively reach sizable television audiences without excessive ad spending. Direct-broadcast satellite (DBS) technology has captured millions of subscribers, significantly reducing the reach of cable advertisers. Moreover, digital broadcasting television has furthered audience fragmentation among cable operators.
Cable Television Benefits
• Penetration of 90 percent of US households
• Typically lower CPM costs compared to broadcast television with similar benefits
• Greater targeting capabilities compared to broadcast television
• Programming available in all time periods
• Original cable television programming comprises 67 percent of all content
• Cable Television Disadvantages
• Smaller audiences than broadcast television
• Excessive fragmentation producing relatively small audiences for many channels
• A greater number of commercials per hour compared to broadcast television
Cable Television and Out of Home
The combination of out of home and cable television offers advertisers similar benefits to the combination of out of home and broadcast television. Out of home reinforces television messages when viewers are away from their homes during the course of daily activities.
Cable television delivers relatively small but targeted audiences compared to broadcast television. Out of home improves cable television’s delivery by improving the overall reach of a campaign.
Out of home offers localized media reinforcement of cable television advertising.
Radio
Driven largely by the increase in the length of consumer commutes, the number of people listening to the radio has grown over the last decade. With varied station formats, listeners have a wide choice of options to satisfy their particular preferences. But, listener fragmentation requires advertisers to buy multiple stations and formats to accumulate a relatively large audience reach, offsetting the cost-effectiveness of radio. The introduction of satellite radio and MP3 technology has stolen audience share from radio stations.
While some technology has hindered the reach of radio listening, other technologies have enhanced radio’s appeal with consumers. Over 4,500 radio stations stream content online through local websites, providing a one-on-one connection with listeners.
Radio Benefits
• Targeting capabilities
• Inexpensive compared to other traditional broadcast media
• Builds frequency quickly
• Branded promotions offer advertisers appealing community involvement opportunities
• No seasonal listener erosion
Radio Disadvantages
• No visual component
• Advertisers must buy multiple stations and formats to accumulate audience reach
• Peak listening is during morning and evening drive times with relatively low audiences during other day parts
Radio and Out of Home
The combination of radio and out of home reaches a mobile audience, offering a balance of sight and sound.
Radio messages are susceptible to channel surfing. Out of home can maintain the market presence of a brand featured on radio after listeners have switched stations. Radio is considered a frequency medium and out of home can increase the reach of a radio campaign by providing broad market appeal to radio listeners.
