Local ads on national radio

gary_s

Just heard an ad on RTE Radio 1 for a music shop in Drogheda.

Why do small local businesses like this advertise on NATIONAL RADIO?

Even if the age profile, social class, etc. etc. etc. of the listeners are right, 95% (at a guess) of listeners will never go shopping in Drogheda, so surely it's a huge waste of money (and yet I often hear such ads).

Are they clueless or have I missed something?

squibs

If it's the shop I'm thinking of, then he may not be daft. My band went up there en masse about 10 years ago and left several grand with him. We travelled from Cork! He had a good selection at excellent prices (in the days before everybody bought everything online). If it is the same shop, it was an odd gaff. You walk in and see a wee grocery shop. Then out the back is a warehouse of musical equipment.

gary_s

It's not just him. I've heard similar ads in the past for clothing shops in places like Athlone, Tullamore, etc.

Surely for the price of an ad on RTE Radio 1 they could buy 20 such ads on local radio?

zippo22

Advertising is a very "hit and miss" affair. Everybody knows 50% of advertising spend is money down the drain. It's just that nobody knows WHICH 50%. As for local advertising on national radio it's not really that odd. Chances are there are as much or more people in Drogheda (just an example) likely to hear the ad on RTE as would hear it on local radio.

gary_s

zippo22 wrote:

Chances are there are as much or more people in Drogheda (just an example) likely to hear the ad on RTE as would hear it on local radio.

Yes, but the ad on national radio will be MUCH more expensive (10 times, 20 times) ?

The price you pay will be in proportion to the number (and type) of listeners. So you get much, much more "bang for your buck" on local radio.

zippo22

On the face of it I would've thought that too. Although I doubt that the cost would be 10 or twenty times the local price. (And I'm saying that without the slightest idea what either charges would be.) Perhaps it's a case of the "wrong 50%" in action.

Genghis

There are different rates for "localised" advertising on national radio. The guy in Drogheda would not be paying the same rate as say eircom for his airtime as the useful audience for his ad is much smaller.

A clever strategy you sometimes come across is for a national brand to be advertised in an ad as being available in a local area - for example, get your new Sony Television at Kellys of Carrick on Shannon. The first part of the ad willl extol the virtues of the new TV set, but the end of the ad ties it to a specific local area and so Sony can avail of the local rates, even though the main message is "national".

I would expect that advertising locally on RTE is commensurate also with the audience share it has in that area (so, advertising for a Dublin store, where RTE has a huge audience and a huge audience share would be more expensive than an ad aimed at Donegal or Kerry listeners, where RTE have far fewer listeners and are less popular than the local stations, Highland Radio and Radio Kerry).

Genghis

Look here for information about rates for local advertising on 2FM and compare them to the rates available here for national advertising on 2FM.

They differ by about 50%, though not on all packages. Interestingly, Radio 1 rates are the same for both Local and National - though this could be a misprint.

Today FM also offer "local trader packages", but that info is only available in request

lardboy

There are local rates for advertisers on national stations and advertisers and agencies will do slightly sneaky things as described above to get those rates. However, any advertiser who uses national radio to target their audience will almost certainly be maxed out on local radio as well if they have any sense. In each franchise area, the local station is almost certainly the market leader. If you really want to know the figures, check out an overview of the last figures here.

Page 4 of the pdf will give you numbers for each local station.

zenith

There's also the possibility that, in August, inventory is available and he's getting it at a good price. Rate cards being a work of fiction, and all that.

I'm expecting the 10-second flash card ads to come back on RTE telly. Remember those? I think only UTV do them regularly now.

EKRIUQ

I advertise on local radio quite a bit, and it works out at 40 euro for 30 second slot and I thought that was expensive but the RTE rates are lot more that I thought they would be the OP poster was right at nearly 10 times as much.

Sandals

Personally as a nobody, When I hear a local business advertising on National radio, it makes the business seem very impressive and i would be more likely to visit.

lardboy

zenith wrote:

There's also the possibility that, in August, inventory is available and he's getting it at a good price. Rate cards being a work of fiction, and all that.

It's always a possibility, as I know that RTE and some others offer bonus during the summer months to fill their books.

I'm not sure that "work of fiction" is quite fair. I see them more as a statement of intent and the degree to which people stick by their intentions varies. There are some stations which use a "That's our price" policy and others, mostly stations in competitive marketplaces (Dublin especially) with who you can negotiate further. Obviously, your end deal will depend on much more than just when you want to run in the year.

Powerboat.ie

As far as I know, these ads are regional transmitter specific i.e. the ads during the Gerry Ryan Show on 2FM heard in Kerry might be different to those heard in the same time slot in say Sligo.

Even though we are a small company, we have considered 2FM in the past as our market is quite national ( Gift Vouchers, Office days out etc.) but the publically quoted prices seemed off the planet. Love to hear from anyone in a similar market who has dabbled in National radio ads. Are there public rates and real rates ?

Best wishes,

Stuart

JohnDigital

RTE's local advertiser rates are discounted rates for an advertiser who's advertising is either just targeting Dublin or any two separate areas of the country. This rate allows for 35% discount off some of the fixed packages. The airtime runs nationally regardless of price paid though. E.g. If you have businesses in Dublin and Galway, but nothing outside that you can avail of the rate.

Unfortunately RTE wont discount their airtime for anyone, regardless of size of advertising spends. They are one of the only companies in the country that are able to secure the full rate for their advertising. Demand is so strong for at least 9 months of the year that they fully sell out all advertising.

The only concession they do offer is occasionally bonus spots in June, July and August when their inventory is not fully sold. However RTE’s prices are very keen when compared to cost per thousands (CPT) from lots of other radio stations, basically the cost or reaching 1,000 of your target audience on RTE stations compared to Local etc.

I have a real problem with the way Radio is sold in ROI where stations force Advertisers to buy fixed packages of spots across the day, or grossly inflated individual line-by-line spots. This is not the right way to sell advertising as advertisers are forced to pay over the top for bespoke spot lists, or to take spots within packages that are not efficient for your target market.

Pretty much every other country sells airtime on a cost per thousand basis where you negotiate a cost per thousand listeners to reach a set coverage and frequency level and your spots are slotted in the most efficient places to reach that audience according to the latest audience research. But selling in packages is easier for the station as they don’t get stuck with the airtime that no one wants.

Genghis

Powerboat.ie wrote:

As far as I know, these ads are regional transmitter specific i.e. the ads during the Gerry Ryan Show on 2FM heard in Kerry might be different to those heard in the same time slot in say Sligo.

I'd be very surprised if that (regional opt-out advertising) was the case.

JohnDigital

The Local Packages all run nationally, same broadcast for every county.

lardboy

JohnDigital wrote:

I have a real problem with the way Radio is sold in ROI where stations force Advertisers to buy fixed packages of spots across the day, or grossly inflated individual line-by-line spots. This is not the right way to sell advertising as advertisers are forced to pay over the top for bespoke spot lists, or to take spots within packages that are not efficient for your target market.

Pretty much every other country sells airtime on a cost per thousand basis where you negotiate a cost per thousand listeners to reach a set coverage and frequency level and your spots are slotted in the most efficient places to reach that audience according to the latest audience research. But selling in packages is easier for the station as they don’t get stuck with the airtime that no one wants.

Do you think that EMAP's entry into the Irish market will see this change? I would have thought that they are a headstrong company who will want to do things the way that they are used to. If they decide to set up a sales office for their stations, they could be the catalyst for a change of currency in radio sales.

JohnDigital

I don’t see things changing in the short to medium term. EMAP’s controlling interest in Today FM and FM104 in the South and Downtown/Cool FM in Ulster with their acquisition of the remaining shares of Scottish Radio Holdings is unlikely to have any immediate effect on how airtime will be sold in ROI.

The Stations do too well out of the current scenario so they will not feel inclined to make any changes. Downtown/Cool already sell on CPT basis as per the other UK stations. The situation is peculiar to the 26 counties. There is a bit of a cartel in action, where all stations vehemently attempt to protect the decision to sell radio in packages and resist calls for a revamp of the sales system towards a CPT model.

Unfortunately there is not enough pressure brought to bear on the stations as advertisers for the most part are not aware that they may not be getting the best mix of airtime for their investment, and probably a laziness on the part of Agencies to seek change as planning and implementing radio when bought in packages is far easier than monitoring delivery under a CPT based system.

lardboy

There was a trial of CPT selling when MediaLink started selling a group of local stations in 2002/03. I beleive there was only a minimal number of campaigns that were bought through them and the trial finished. Without going into too many details, I don't think anyone came out of it particularly well. The agencies didn't respond to the new currency that a number had been asking for, the sales house didn't promote the stations themselves and the stations had split their sales operations between at least two houses, creating some confusion.

I agree that CPT buying is the correct way to go, as this rewards a strong station, but it may lead to an inertia in programming where people are less likely to take risks as a drop in listenership could have a massive effect on revenue. However, it will take a brave station to be the first to change their currency. I can't see RTE changing anytime soon, especially as they would have to retrain all the sales staff, which would be a mammoth task in itself! If RTE remain on a spot/package basis, I can't see anyone else making the change.

JohnDigital

I agree, I don’t see RTE Radio going CPT any time soon. As it stands they sell all airtime at least 9 months of the year so have little to gain by changing when advertisers are prepared to pay the price on the rate card as it stands. They find it hard enough to manage their inventory, as it is when all they have to do is slot packages and fill in the gaps with individual spots.

It took RTE TV Two years to find their feet when they moved from Pre-empt to a deal based system and cost them an unholy amount of money in systems, training and badly negotiated deals. I really don’t see them doing that with the current Radio Sales dept.