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How Agencies Buy Radio

 The primacy of numbers perhaps is best illustrated through a discussion of how advertising agencies place money on radio stations. It is the media buyer’s job to effectively and efficiently invest the advertiser’s money – in other words, to reach the most listeners with the budget allotted for radio use. According to media buyer Lynne Price, the most commonly employed method determines the cost per point (CPP) of a given station. Lynne explains the procedure: “A media buyer is given a budget and a gross rating point (GRP) goal. Our job is to buy to our GRP goal, without going over budget, against a predetermined target audience, i.e., adults 25 to 54, teens, men 18 to 34, etc. Our CPP is derived by taking the total budget and dividing by the GRP goal, or total number of rating points we would like to amass against our target audience. Now, using the CPP as a guideline, we take the cost per spot on a given station, and divide by the rating it has to see how close to the total CPP the station is. This is where the negotiation comes in. If the station is way off, you can threaten not to place advertising until they come closer to what you want to spend.”



The other method used to justify station buys is cost per thousand (CPM). Using this technique, the buyer determines the cost of reaching 1000 people at a given station. The CPM of one station is then compared with that of another’s to ascertain efficiency. To determine a station’s CPM, the buyer must know the station’s average quarterhour audience (AQH persons) estimate in the daypart targeted and the cost of a commercial during that time frame. The following computation will provide the station’s CPM: by dividing the number of people reached into the cost of the commercial, the CPM is deduced.

Thus, the lower the CPM, the more efficient the buy. Of course, this assumes that the station selected delivers the target audience sought. Again, this is the responsibility of the individual buying media for an agency. It should be apparent by now that many things are taken into consideration before airtime is purchased.

Careers in Research   

The number of media research companies grew rapidly since the late 1960s but slowed in the post-Telecom Act 1990s as station consolidation became the rule of the land. Today dozens of research houses nationwide offer audience measurement and survey data to the electronic media and allied fields. Job opportunities in research have increased proportionately. Persons wanting to work in the research area need sound educational backgrounds, says Surrey’s Porter. “College is essential. An individual attempting to enter the field today without formal training is at a serious disadvantage. In fact, a master’s degree is a good idea.” Dr. Rob Balon, president of Balon and Associates, agrees with Porter. “Entering the research field today requires substantial preparation. College research courses are where to start.”

Researcher Ed Noonan is of the same opinion. “It is a very competitive and demanding profession. Formal training is very important. I’d advise anyone planning a career in broadcast research to get a degree in communications or some related field and heavy-up on courses in research methodology and analysis, statistics, marketing, and computers. Certain business courses are very useful, too.” To Don Hagen of Southeast Media Research, a strong knowledge of media is a key criterion when hiring. “One of the things that I look for in a job candidate is a college background in electronic media. That’s the starting point. You have to know more today than ever before. Audience research has become a complex science.”

As might be expected, research directors also place considerable value on experience. “The job prospect who offers some experience in the research area, as well as a diploma, is particularly attractive,” notes researcher Dick Warner. Ed Noonan concurs. “Actual experience in the field, even if it is gained in a summer or part-time job, is a big plus.” Christopher Porter advises aspiring researchers to work in radio to get a firsthand feel for the medium. “A hands-on knowledge of the broadcast industry is invaluable, if not vital, in this profession.” In the category of personal attributes, Dick Warner puts inquisitiveness at the top of the list. “An inquiring mind is essential. The job of the researcher is to find and collect facts and information. Curiosity is basic to the researcher’s personality.” Don Hagen adds objectivity and perceptiveness to the list, and consultant Dwight Douglas emphasizes interactive skills. “People skills are essential, since selling and servicing research clients are as important as the research itself.” Although not everyone is suited for a career in audience research, those who are find the work intellectually stimulating and financially rewarding

What a Research Company Does

Bolton is a quantitative research company – our main objective is to get the opinions of radio listeners on virtually anything having to do with the sound of a given station (or future station). There are several methods we use to get the info:

• Perceptual studies. These are indepth surveys that gather opinions on issues such as music preferences, station personalities, competitors. All respondents are included based on their age, listening habits (e.g., favorite station), favorite music types, ethnicity, county of residence, and anything else of importance to the station (client). These surveys run 15–20 minutes. Respondents are selected at random. We also do tracking studies, which include respondents from the original survey and which measure changes in opinion (usually 6 months out from the original survey). Perceptual studies are the foundation of research, because they provide overall market information: perceptions of the client’s station and its competitors, which the station uses to make programming, marketing, and sales decisions. The information gathered also aids us in designing a research program for the station.

• Music and program testing. There are several commonly used methods for testing music and program elements.




1. Auditorium testing. This is the industry standard for testing music that may be aired on the station. Respondents are screened according to station listenership, and paid an incentive between $35 and $50, depending on the market size. The typical test involves 100–150 respondents; they are usually split into two groups. Each group gathers at a hotel, where they listen on speakers to 350–400 hooks (5–10 seconds of a song, the most memorable part). In total, 700–800 hooks will be tested. The respondents score each hook, using a 1–5 (or similar) scale. They also note if they are familiar with the song, and give it a burn score if they’re tired of hearing the song.

Bolton does “Personalized Music Tests” (PMT) instead of auditorium tests. Respondents in a PMT come to a facility at a time of their choice, and they test the hooks on Walkman-style cassette players with headphones. We’ve found that we have a better turnout than the auditorium tests and that the results are better because each respondent hears the hooks the same way (in an auditorium, respondents are at different distances from the speakers) without distractions from other listeners. Auditorium tests are still the industry standard, however

2. Perceptual analyzer tests. In both of the previous methods, responders typically score hooks with paper and pencil. The data then must be coded and tabulated before the client sees the results. A recent development, perceptual analyzer tests, gives a client instant information. As the scores are given, the computer produces an instant, continuous EKGlike graph that shows averages for different groups – a station’s “core” listeners and its competitors’ listeners, for instance. We’ve found this method (we call the test “BoltScan”) to be most useful in testing music in the original order that it actually aired, thereby showing us both popular songs that keep listeners tuned in, and the stuff that causes tune-out. It works the same way for testing morning shows, comedy bits, and so on.

3. Call-out music research. This is a staple of radio programming. Respondents of a specific age and listening group – typically core listeners in a tight age range – are called at home and asked to score 25–30 hooks. The test is obviously short and can be conducted biweekly or even weekly. This information is most useful for trending the familiarity, popularity, and burnout of  songs (usually new songs) over time. Callout is a task often assigned to station interns, but a number of research companies offer the service as well.

4. Focus groups and listener panels. Focus groups are, of course, used for all kinds of consumer product testing, and radio is no exception. Again, respondents are screened for age and listenership. Chosen participants are paid a small incentive and come to a focus group facility or hotel room in groups of 8–12. Station staff observe while the moderator asks respondents about their likes and dislikes of station attributes, including music preferences, personalities, competing stations, etc. Listener panels are more informal and are usually done in-house by the station. Respondents are recruited on the air or from the station’s database. Again, respondents are asked for their opinions about the station.

5. Statistics. Although some complicated statistical methods are sometimes used, the vast majority of data analysis involves “descriptive” statistics: frequency and average scores. Frequency is a computation of how many people fit into a category or choose a given response to a question. Averages (mean, median, mode) are measures of average or typical performance. For most research reports, these basic statistics are enough.

Some more sophisticated statistics are used to look for relationships and differences between groups: correlation ANOVA (analysis of variance) t-tests, chisquare, and cluster and factor analysis. For instance, we often use cluster analysis to separate respondents into distinct groups, such as Modern Rock and Classic Rock lovers. This helps a station to determine which artists are unique elements in a specific audience’s tastes.  
 


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