Taking brands beyond the sound barrier

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Radio stations, both big players and new entry names, are playing with online formats to give advertisers deeper and interactive access to listeners. Morag Cuddeford Jones investigates.

Radio, traditionally viewed as one of the advertising world’s more workaday resources, is undergoing something of a makeover. With the analogue radio switch-off still proposed for between 2015 and 2020, ’traditional’ stations are opening up to the possibilities of online radio.

At the same time, there has been something of a surge in awareness of online-born radio entities. Pandora, the US-based multi-station online radio station which claims to have 3.2% of the US radio listening audience, unveiled its IPO in June at $16 a share. This puts the company’s value at more than $3bn. Meanwhile, Radioplayer, an online radio station aggregator, has notched up nearly 6 million listeners since its launch in March 2011.

Online radio is certainly growing in popularity in the UK. The latest figures from Rajar show that 20% of smartphone owners in its Midas survey have downloaded a radio app. Thirty-one per cent of adults have listened to radio online, with 29% having listened live and 25% using the time-shift capability. Awareness of personalised Online Radio (POR) has risen from 15% to 17%, while the number of users has risen from 8% to 11% with 6% listening at least once a week.

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“Radio stations are effectively acting like mini media agencies now,” claims Steve Parkinson, managing director of both the online and offline properties for the Kiss and Magic radio brands at Bauer Media. “The trend within radio is interactivity with brands through experiential marketing and sponsorship via websites, events, social media – it’s a through-the-line mix.”

Certainly, online radio gives extra dimensions to brand marketing that simply weren’t possible in the analogue sphere. Consumers may ’listen’ in as usual, but confronted with the visuals and interactivity of the station’s web presence, they can’t help but interact with brands at a much deeper level.

For some, it’s a simple case of multichannel synchronicity. Clipper Tea uses music service Spotify to broadcast brand messages, issue a call to action and develop the interactive element through banner advertising on the Spotify site.

Commercial director for Clipper Tea Gill Hesketh explains: “We liked the immediacy of it. It’s a brilliant piece of interruptive advertising – listen to the ad, click on the banner, see our pop-up microsite, be sent free tea. It has everything we need.”

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Spotify UK sales director Adam Williams adds: “Our proposition is that we are able to serve a display ad with audio, which means brands can instantly drive potential customers to their content, such as a website, where they can engage and interact with listeners. In essence, advertising on Spotify supplies a seamless link from a consumer’s own music where there is deep engagement with high emotional resonance, to an advertiser’s site.”

For Parkinson’s Kiss station, the recent decision by Ofcom to relax the regulations surrounding product placement have meant that brands can now become involved in the editorial side, giving richer content. He cites BlackBerry as a major partner. The deal enables listeners to BBM [instant messaging via BlackBerry only] the presenters live in the studio, while the brand also has a presence online through design on the breakfast show webpage. It also sponsors the Kiss mobile app as well as hooking up online and mobile users to exclusive events around the UK. With the online and mobile integration, Parkinson claims that Kiss “is no longer just a radio station, it’s multimedia.”

BlackBerry owner Research In Motion senior director Sarah Probert says: “Multi-platform communication helps us to drive a deeper engagement with our audience. One of the highlights of our partnership with Kiss is that it puts BlackBerry smartphones and applications at the heart of the editorial content, letting the activity run live on-air, online and through social media.”

Online radio also gives brands a reason to spread their spend across the day rather than trying to crowd into the already busy popular morning and evening time slots. British Gas head of advertising Chris Brocklehurst says this is a “very exciting time” for radio, pointing to work his agency Carat is doing on targeting listeners by time of day.

Carat’s print and radio director, Dominic Williams, explains: “Online gives radio brands direct point-of-sale access where consumers can respond to call-to-action messages or find out more information about products there and then, essentially making the spot ad more valuable. The formats also allow for some degree of cross-day parts targeting, so that there is less pressure on getting the traditionally key breakfast and drive [times] and instead spreading the focus across the whole day.”

The ability to link in with social media elements is key. Online radio has become a shareable resource with users creating playlists to share online through Facebook and other social hubs. Brands that can make use of this can naturally piggyback this sharing activity.

“Brands can use the Spotify content to feature user-generated playlists in their campaigns, without the consumer leaving their web page or Facebook page. Because people like to share music so much, creating a music-driven campaign on a social network where sharing is natural behaviour has the most impact for the brand,” Williams explains.

British Gas
Spread the load: The ‘listen anytime’ quality of online radio means British Gas does not have to focus ads around breakfast and drive-time periods (see Q+A below)

The emotional link with music is another benefit of radio where online can help add new dimensions. Pandora senior vice-president of strategic solutions (advertising) Heidi Browning says: “Audio is the connective tissue across our multiple platforms. We think about our ad solutions as sound, sight, motion and emotion.”

For example, Toyota has developed a series of genre stations with Pandora under the ’Legends and Icons’ banner. Each music genre station is linked to one of Toyota’s range of vehicles. The station hopes to use the emotions people associate with the music to link with the brand, aiming to create a deeper connection with the consumer.

This scheme is also the precursor to Toyota’s Entune technology with Pandora integration that will be available in cars later in 2011. Entune will make online radio available through the car radio. As smartphone technology and radio apps become widespread – Kiss alone already has 42 apps – the portability of online and digital radio should increase further in every sector, not just cars.

As well as increasing portability, many marketers believe online radio offers them better targeting, not just by day part but also by location. Even big-name brands such as Bauer Media’s Kiss can be split into sub-genres giving advertisers access to very specific demographics.

The tourism body for Australia’s Northern Territory is using the Kiss radio brand online in this way to make sure it can reach “young British travellers”, according to George Christakis, Tourism NT sales and marketing manager for the UK, Ireland, Netherlands and Nordic regions. The target market might be on the other side of the world from Tourism NT, but online radio can reach them.

It isn’t just geographic reach that counts. Whereas commercial radio might be judged in terms of its reach, the proliferation of very niche online stations is now deeply attractive to marketers. While big radio brands are becoming online stations almost by default as they expand their existing web presence, niche stations such as children’s Funkids and heavy metal’s Onslaught are also springing up. And brands are joining them.

Jo Thomas, marketing director at Shewee, the portable female urinal product, is one of them. “We wouldn’t be able to run ads on one of the bigger stations; this is the first time that we’ve begun exploring paid-for advertising on the radio at all. Before, we’d just send in lots of product and hope to get a mention.”

Online radio has become a shareable resource with users creating playlists to share online through Facebook and other social hubs

In a real case of bootstrapping, Shewee used a student’s university project for its creative and linked up with Onslaught to develop an integrated campaign featuring on-air slots and banner ad competitions. So far, Thomas is happy with the result. “We are only 12 days in and it’s running for three months. This is a good way to move our focus to the music area – so far we’ve focused on hardcore outdoor sports. This is very much a test but the cost and targeting aspects are proving to be a big benefit.”

In the case of Funkids, an online and digital station aimed squarely at an audience of under-10s, book publisher Random House found it the only compelling way to advertise online for its children’s range of titles. “Funkids is the only station that I know of that is so targeted. The match with something like Capital still isn’t right, which admittedly a lot of teenagers like, but there’s still a lot of wastage,” says Barry O’Donovan, marketing director of Random House’s children’s section.

Tight targeting was Funkids’ initial attraction for O’Donovan but he acknowledges that the multiplatform element was a big draw. O’Donovan claims he finds it hard to think of any part of Random House that had previously been using radio or online, so the growth in online radio suits it well. It is monitoring both very niche, targeted stations and large-scale, big-name brands that are expanding their multiplatform offering for potential.

He says the potential of online radio for marketing has only just begun: “It’s engaging and joined up. Content gives prolonged brand exposure and has delivered really strong engagement. I’m convinced that online radio will be something we will use more in future.”

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Brand in the spotlight: Chris Brocklehurst, head of advertising British Gas

Marketing Week (MW): How important is the interactive element of online radio to reinforcing your brand messages?

Chris Brocklehurst (CB): With online radio, the potential to advertise products to a more targeted audience is enormous. We are able to target our message far more specifically, not only by a niche interest or genre of music, but by supporting this through visual information such as phone numbers, product details and special offers. This means that we are able to avoid becoming advertising clutter and provide messages that are more customer centric.

We understand that without the support of advertisers, innovation can often fail to get off the ground, so we are prepared to support fresh ideas that deliver value and effectiveness for our consumers. To ensure we get the greatest reach, all of our campaigns include an analogue, DAB and an online element.

MW: What are the pros and cons of using online radio?

CB: Along with being able to be more targeted to particular audiences with relevant messages and providing interactivity with the brand, online radio is able to bridge the gap between the traditional peaks of breakfast and evening drive-time as consumers are now able to access the medium through various formats throughout the day.

Flexible programming and distinctive target audiences create limitless opportunities for innovative advertising, promotion and sponsorship campaigns.

Of course, with increased fragmentation of the market, we have faced challenges concerning, for example, robust measurement and delivery of campaigns. Yet if clients and agencies continue to push for these as areas of concern for any online station, these issues will dramatically improve.

Top trends

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Chris Brocklehurst, head of advertising, British Gas

This is a very exciting time for the medium and the advertisers involved. Similar to the developments we have seen in the personal video recorder and video-on-demand markets, the technological advancements will be driven by consumers’ desire for personalisation. In the future, listeners will be able to download and store anything they see or hear on radio, allowing them to respond to advertiser messages either instantly or at their leisure.

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Gregory Watson, managing director, Funkids

Some people will be using online radio just to tick a box. It’s got to be made as interactive and exciting as possible. Big groups will be able to invest in the web presence but I fear smaller stations will struggle because they are too focused on the day-to-day management and just keeping their mainstream business going.

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George Christakis, sales and marketing manager – UK, Ireland, Netherlands and Nordic, Tourism NT

Live streaming and the increase of smartphone penetration including radio apps, which are growing in popularity, means that brands have better scope to connect with listeners. Radio is now multiplatform media. Coupled with the scope for producing engaging content, the possibilities are endless.

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Barry O’Donovan, marketing director, Random House Children’s Books

No one has come to me with a proposal that is quite right yet. Beyond the BBC, the radio market is a bit fiddly and fragmented, and I think it should be looking for a way to centralise some operations to make it easier for brands.

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Heidi Browning, senior vice-president of strategic solutions (advertising), Pandora

We think it’s important to reach audiences across multiple platforms, and mobile is an increasingly important platform. Mobile allows brands to connect with listeners while they are on the go and deliver locally targeted messages. Pandora’s mobile advertising platform is the new point-of-sale medium for marketers to activate.

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