Retail is moving more dollars than ever into radio


We’ve been hearing this quite a bit lately: the medium is changing—meaning the way the dollars are coming into radio. Retailers like Macy’s, Lowe’s, Home Depot, Walgreen’s, AutoZone, Kohl’s and Wal-Mart, while some are giving longer and some shorter commitments, they all are becoming more familiar with the medium than ever. The radio medium is becoming more and more retail-based – and there is absolutely nothing wrong with that! The medium is taking brand money and tying it into their retail promotions. This is getting dollars into radio that may have gone to newspapers, TV or magazines previously.

“There are new advertisers to radio that weren’t here before. Each retailer does their business a little differently. Macy’s, for example, is fairly new to radio [they weren’t in much over a year ago] – general market, Hispanic and spot,” said one seller. “Retailers are also doing more and more advertising for the products they sell and they are getting comfortable with the product. They are all working out ways to use the product and promote radio within their media mix. Radio, they are finding, works well – it’s an excellent medium for building store traffic, from last minute point of purchase to when they’re driving into the shopping mall.”

As well, business is evolving more and more to short-term notifications–last-minute. The advertisers negotiate a network rate and then place business throughout the year as budgets are approved, so the rates are established.

“One week you may get $50K; another week you may get $100K. So if you are getting $100K a week, that adds up to $5 million pretty fast,” said a seller. “That’s how it comes in—I have been placing business just a day or two before the campaign runs. Multiply these numbers by 52 and you are really starting to see some big numbers.”

One retailer for example, is placing network business now to air later this week nationally. And this is happening week after week after week. That’s another good thing about radio – the medium can and will fit them in!  They are seeing product movement because of the immediate results radio is able to generate. This is also more evidence that the traditional network radio upfront is becoming a thing of the past.