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December 20, 2006

Radio Advertising And Google Audio: What Everyone Is Missing

Is it scalable?

Let's say you use Google Audio to book your radio advertising. And let's put aside for the moment the important issue about who is going to create a successful radio ad for you - one that is based on what works and what doesn't in radio advertising.

So you book your media and, assuming you're using the principles of direct response radio advertising, you're able to find that your radio advertising results in a profit to your company.

What are you going to want to do next?

You're going to want to a) re-book the stations that worked, and b) grow your media spend by adding radio media buys on new stations, likely of the same formats that delivered profits in the first round.

If Google's radio advertising approach is "opportunistic", meaning you're picking up left over inventory at a discount, then you won't necessarily be able to get back on the air the following week on those stations that worked for you. Further, you won't necessarily be able to get on additional stations of the same format for the same cost that you initially paid.

Maybe it's not clear why these are problems. "Why not just wait until you can get back on those stations again?", you ask. Because no business I've heard of functions well in a situation when it's impossible to forecast advertising spending. Keep in mind, advertising in direct response radio drives your sales, and sales trigger the need for inventory (and/or staffing). And inventory usually needs to be ordered ahead of time.

By implication, you won't have control over the timing or pace of your growth, either. Such is the downside of an opportunistic approach verses a strategic one.

So at best, Google Audio will be just like dMarc Broadcasting - a good addition to a larger radio advertising budget, but due to practical business issues mentioned above, not a significant piece of it.

Posted by Brett Astor at 03:52 PM | Permalink