Traditional or terrestrial radio stations make most of their revenue selling “airtime” to advertisers. Of the total media expenditures in the US, radio accounts for 6.9%. While radio has declined with younger listeners, radio can still be an effective medium for your marketing mix.
The radio industry has changed significantly since that first broadcast in 1920. Internet radio listening is growing with 13% of the U.S. population listening via this method. Internet radio (also web radio, net radio, streaming radio, e-radio webcasting) is an audio service transmitted via the Internet. Maybe it is time to consider adding streaming to your media mix.
Many local radio stations have streaming capabilities and there are also companies such as Pandora that offer streaming music. Internet radio services offer news, sports, talk, and various genres of music—every format that is available on traditional radio stations.
Streaming is an easy way for listeners to listen at work via their computers and is very popular with younger demos. While the audience is smaller than the station’s regular broadcast audience, these are usually a station’s most loyal listeners and the good news is that these listeners tend to stay tuned in during the commercials. They also listen for longer periods of time. With less turn over, you can buy fewer commercials to impact the streaming audience.
Internet radio audience measurement is superior to traditional or terrestrial radio audience measurement. It is obtained from the broadcaster's audio streaming server. It uses actual data collected from streaming servers rather than estimated data. Icecast, Nicecast, and SHOUTcast are examples of audio streaming servers that provide listener statistics for audience measurement. These numbers often include information such as listeners' IP addresses, the media player they are using, how long they listened, and their computer's operating system. These statistics are much more accurate than the diary and people meter estimates that are based on very small sample sizes.
Arbitron, a US radio research company that collects listener data on terrestrial radio audiences, has begun collecting listener data for Internet radio stations. Based on a survey of 200,000 users, the statistics collected from those listeners are then projected against the estimated 52 million actual Internet radio listeners. This approach differs greatly from terrestrial radio audience measurement. Demographic and psychographic information cannot be easily collected due to the geographically diverse nature of typical Internet radio audiences.
Many traditional radio stations offer their streaming as added-value or for a very low cost. Obtain the actual audience numbers from the stations and see if it is an efficient use of your ad dollars. It can be a great way to add frequency and reach the loyal listeners with a small budget. As more listeners move to the digital world, streaming will play a larger role in the radio advertising industry.
If you would like to know more about how to use radio advertising effectively, download our FREE tips on how to choose the right radio stations.