Spot Radio Posting: Progress in AccountabilityNovember 6, 2008
Radio Historically Had Less Accountability Than Other Media
While guaranteed audience delivery posting thresholds have been broadly accepted for local TV buys and print offers circulation guarantees, spot radio traditionally has not offered the same accountability. As a result, many agencies have not produced post-performance reports for radio – leaving advertisers without much insight into the performance of their radio investment.
Changing Tides
All of this has begun to change. MMI has conducted spot radio audits for five years, encouraging clients to discuss radio accountability with their agencies and secure delivery guarantees in negotiations. In May 2008, the Radio Advertising Bureau (RAB) issued recommended guidelines to bring accountability to local radio. Included were post-reporting of actual ratings delivery and advertiser guarantees to assure that clients are compensated when posted delivery falls short of minimum thresholds.
The RAB guidelines are relatively broad, advocating posting by market (rather than by station – the standard practice in TV), posting based on multi-book averages, and posting based on broad dayparts and target demographics. The resolution did not address delivery thresholds to be used to establish restitution owed (e.g., guaranteeing 90%+ of negotiated audience delivery). Questions also remain regarding standards for diary markets vs. Personal People Meter (PPM) markets, as Arbitron’s PPM is intended to provide more timely and accurate ratings than diaries. This is expected to drive agency and station accountability in the medium, a potential boon for advertisers.
Where do we go from here?
MMI supports the efforts of the RAB and radio station groups to improve the standards of Spot Radio negotiations, posting and accountability. We encourage an open dialogue between buyers and sellers to establish Best Practices and to clearly outline expectations. Clients should communicate with their agencies to establish expectations regarding:
- Guarantees by market vs. station or ownership group
- Minimum delivery thresholds (90%, etc.)
- Posting methodology by market type (diary vs. PPM, 4-book vs. 2-book, etc.)
- Methodology for estimating and posting in markets during shift from diary to PPM
- Timetables for posting and securing restitution
Ultimately, Spot Radio advertisers should expect more transparency and accountability than they have obtained in the past, assuring they receive what they purchased. A third party assessment of delivery vs. guarantees, restitution owed, and compliance to buying guidelines can further increase transparency for clients and inform processes for their agencies. This increased comfort level by advertisers with the medium will also serve agencies and radio stations well.
Arbitron PPM Markets
| Market | Currency Date |
|---|---|
| Philadelphia | Mar 2007 |
| Houston | June 2007 |
| New York | Sep 2008 |
| Nassau-Suffolk (Long Island) | Sep 2008 |
| Middlesex-Somerset-Union | Sep 2008 |
| Los Angeles | Sep 2008 |
| Riverside-San Bernardino | Sep 2008 |
| Chicago | Sep 2008 |
| San Francisco | Sep 2008 |
| San Jose | Sep 2008 |
Dallas-Ft. Worth, Washington, DC, Detroit and Atlanta are in pre-currency phase and scheduled to roll out in December 2008. The balance of the top 50 radio markets are scheduled to roll out in 2009 and 2010.
