1. The Sales Impact of Radio
A Look at Radio Performance for
Department Stores & Telecom
Nielsen 2015 ROAS study
ROAS: Return-On-Ad-Spend

2. We now have empirical data We must be the evangelists!
For too long we’ve been dealing with anecdotal evidence of performance not empirical data
We now have empirical data
We must be the evangelists!

3. Who conducted this research?
Nielsen did
Largest global marketing research firm worldwide
Also measures TV, Online, VOD
So has no horse in this race---completely unbiased
Nielsen would never put their name on any research that couldn’t withstand the scrutiny of research experts worldwide

4. Background: DEMO A18+ To measure the sales impact of radio advertising
RESEARCH OBJECTIVE
To measure the sales impact of radio advertising
Department Stores
4 Brands
Test Period: Q3 2014
Pre Period: Same Time Prior Year
Telecom
1 Brand
Test Period: Q1 2014
Pre Period: 3 months prior

5. Nielsen’s PPM Audio Technology: To record Listening
PPM encoding solution identifies broadcast and online audio content 1.
The meter, worn all day, detects the watermark embedded in the audio broadcasts 2.
Data collected by the meter are sent to Nielsen Audio 3.
Capable of measuring radio, television and Internet broadcasts, retail video and audio broadcasts.
Meter automatically detects inaudible codes embedded in audio portion of broadcast program or commercial.
Proprietary codes identify media to which participant is exposed.

6. Nielsen Audio Reporting
This listening data is then Matched to Media Monitors commercial occurrence data (Was the listener tuned in when the commercial ran)
Nielsen Audio Reporting
Nielsen Audio Panelist Exposures – Radio Commercials
Advertisers air commercials on radio stations. The “listening” to those stations is captured by Nielsen Audio providing minute-by-minute listening to each station.
Media Monitors provides the occurrence data which details the station and time of airing for each commercial. These two are matched to report the audience to each commercial in a radio campaign. NCS is extremely grateful to Clear Channel for providing Media Monitors data for this analysis, and extremely grateful for all the support provided by Media Monitors to enable this methodology.
Matched to Radio Commercial Occurrence Data*

7. This information is then fused with credit and debit card purchases
SINGLE SOURCE (Individual) DATABASE
PURCHASE BEHAVIOR: Credit & Debit Card Expenditures of 125 MM unique cardholders
80%+ US credit card transactions
30% of US debit card transactions
12B transactions accounting for $1.2 trillion spent annually

8. It boils down to this….
Comparing the purchasing habits of those exposed to the commercial and those not exposed to the commercial
They match Radio PPM listening with Media Monitors commercial occurrence data to determine if the participants were exposed to the advertiser’s commercial and if they were exposed they determine how purchasing behavior (via their credit and debit card records) differed from those not exposed to the commercial

9. 3 PILLARS THAT DRIVE ROAS- Return-On-Ad-Spend
MORE
BUYERS
BUYERS SHOPPING MORE OFTEN
BUYERS SPENDING MORE PER TRIP

10. Incremental spend for customers exposed to the Q3-2014 radio campaigns
DEPARTMENT STORES $17 OF INCREMENTAL SALES FOR EVERY $1 SPENT ON RADIO
EXPOSURE TO RADIO CAMPAIGNS DROVE A +10% INCREASE IN SALES OVERALL
RADIO BROUGHT IN MORE SHOPPERS AND THEY SPENT MORE EACH TIME THEY SHOPPED
3% increase in
total number of buyers
6% increase in
dollars spent per buyer
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT
Long term will be higher- residual effects
$17 ROAS
$356,966,946
Incremental spend for customers exposed to the Q radio campaigns
$20,999,788*
Total Q radio ad spend
Q Four brands - Compared to same time prior year
* Ad spend source is SQAD

11. Incremental spend for customers exposed to the Q3-2014 radio campaigns
DEPARTMENT STORES $17 OF INCREMENTAL SALES FOR EVERY $1 SPENT ON RADIO
EXPOSURE TO RADIO CAMPAIGNS DROVE A 10% INCREASE IN SALES OVERALL
RADIO BROUGHT IN MORE SHOPPERS AND THEY SPENT MORE EACH TIME THEY SHOPPED
Develop into loyal customers
3% increase in
total number of buyers
6% increase in
dollars spent per buyer
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT
$17 ROAS
$356,966,946
Incremental spend for customers exposed to the Q radio campaigns
$20,999,788*
Total Q radio ad spend
Q Four brands - Compared to same time prior year
* Ad spend source is SQAD

12. Incremental spend for customers exposed to the Q3-2014 radio campaigns
DEPARTMENT STORES $17 OF INCREMENTAL SALES FOR EVERY $1 SPENT ON RADIO
EXPOSURE TO RADIO CAMPAIGNS DROVE A 10% INCREASE IN SALES OVERALL
RADIO BROUGHT IN MORE SHOPPERS AND THEY SPENT MORE EACH TIME THEY SHOPPED
3% increase in
total number of buyers
6% increase in
dollars spent per buyer
Radio advertising impacted behavior
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT
$17 ROAS
$356,966,946
Incremental spend for customers exposed to the Q radio campaigns
$20,999,788*
Total Q radio ad spend
Q Four brands - Compared to same time prior year
* Ad spend source is SQAD

13. Incremental spend for customers exposed to the Q3-2014 radio campaigns
DEPARTMENT STORES $17 OF INCREMENTAL SALES FOR EVERY $1 SPENT ON RADIO
EXPOSURE TO RADIO CAMPAIGNS DROVE A 10% INCREASE IN SALES OVERALL
RADIO BROUGHT IN MORE SHOPPERS AND THEY SPENT MORE EACH TIME THEY SHOPPED
3% increase in
total number of buyers
6% increase in
dollars spent per buyer
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT
Long term will be higher- residual effects
$17 ROAS
$356,966,946
Incremental spend for customers exposed to the Q radio campaigns
$20,999,788*
Total Q radio ad spend
Q Four brands - Compared to same time prior year
* Ad spend source is SQAD

14. Incremental spend for customers exposed to the Q3-2014 radio campaigns
DEPARTMENT STORES $17 OF INCREMENTAL SALES FOR EVERY $1 SPENT ON RADIO
EXPOSURE TO RADIO CAMPAIGNS DROVE A 10% INCREASE IN SALES OVERALL
RADIO BROUGHT IN MORE SHOPPERS AND THEY SPENT MORE EACH TIME THEY SHOPPED
Develop into loyal customers
3% increase in
total number of buyers
6% increase in
dollars spent per buyer
Radio advertising impacted behavior
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT
Long term will be higher- residual effects
$17 ROAS
$356,966,946
Incremental spend for customers exposed to the Q radio campaigns
$20,999,788*
Total Q radio ad spend
Q Four brands - Compared to same time prior year
* Ad spend source is SQAD

15. 10% 43% 10% DEPARTMENT STORES HISPANIC AND AFRICAN-AMERICAN INSIGHTS
% Change TOTAL SPEND
10%
43%
10%
PERSONS 18+
HISPANICS 18+
AFRICAN-AMERICANS 18+
Previous Nielsen study Q also showed that Hispanic ROAS was larger than general market

16. Hispanic radio dollar share point gains by advertiser
2014 study: Hispanic consumers show higher response to campaign exposure
Hispanic radio dollar share point gains by advertiser
+22%
Source: Nielsen Catalina Solutions Studies of 3 radio ad campaigns, March 26, 2014 indexed to general market share point gains from study

17. Black radio average dollar share point gain by advertiser
2014 Study: Black consumers show higher response to campaign exposure
Black radio average dollar share point gain by advertiser
+19%
Source: Nielsen Catalina Solutions Studies of 3 radio ad campaigns, March 26, 2014 indexed to general market share point gains from study

18. TELECOM $14 OF INCREMENTAL SALES FOR EVERY $1 SPENT ON RADIO
The Telco company radio campaign reached almost 88 million people (P18+)
in PPM markets
Telco company buyers exposed to radio campaign spent $8 more per month than consumers who were not exposed
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT
$14 ROAS
$210M
Incremental spend on Telco Brand by customers exposed to radio campaign
$15.3M*
Spend on radio
SOURCE: Nielsen Buyer Insights P18+ Telco Brand campaign (1/1/14-3/31/14)
* Ad spend source was Client Provided Budget

19. TELECOM MILLENNIAL AUDIENCE INSIGHTS
Not only do Millenials listen to Radio they respond to its commercials
During the campaign period, Millennials exposed to the campaign had double the increase in monthly spending for the Telco company’s products and services ($16 increase in monthly spending vs. $8 increase for A18+ exposed audience).

20. RADIO DRIVES ROAS FOR DEPARTMENT STORES AND MANY OTHER CATEGORIES
RADIO PAYBACK PER $1 AD INVESTMENT
Q1 2014
Q3 2014

21. RADIO DRIVES ROAS FOR DEPARTMENT STORES AND MANY OTHER CATEGORIES
RADIO PAYBACK PER $1 AD INVESTMENT
Retail A +B average out to $17 as well
Q2 +Q3 2013

22. RADIO DRIVES ROAS FOR DEPARTMENT STORES AND MANY OTHER CATEGORIES
RADIO PAYBACK PER $1 AD INVESTMENT

23. A $3 or $4 ROAS is still strong and noteworthy Retail and Department stores ROAS will always be higher for two reasons: - Higher ticket items than chips, candy and soda - Market basket potential: i.e. I go to purchase the product advertised in the department store but end up buying other products in various departments

24. Now let’s put these Radio ROAS results into some kind of perspective

25. Below came from a recent Bloomberg article
Ron Amram works for Heineken
“Late that year he (Amram) and a half-dozen or so colleagues gathered in a New York conference room for a presentation on the performance of the online ads.
They were stunned. Digital’s return on investment was around 2 to 1, a $2 increase in revenue for every $1 of ad spending, compared with of at least 6 to 1 for TV.”
Makes Radio’s performance in both ROAS studies look pretty good!

26. Advertising Age What Medium Scores Highest ROI
Advertising Age What Medium Scores Highest ROI? It May Be Radio Nielsen Catalina Study Shows Big Returns for Small Outlays
Published on March 25, 2014
Brands averaged a sales lift of more than $6 for every $1 spent on radio ads – an ROAS double that of even the best results from many recent studies of digital or TV media, including one from France and Coca-Cola that Facebook recently touted.

27. Great Book written by Erwin Ephron: titled Media Planning
A little noted fact from the 2014 Nielsen study Found that radio delivered a powerful sales lift when heard within a few days of purchase. A consumer exposed to an ad within a day of purchasing increased the brand share by +9%, while messages delivered 28 days prior to purchase increased share by +3.4%. Speaks to the importance of continuing brand presence- Being there! Of delivering a message within the window of opportunity— one of Radio’s key strengths
Recency
Great Book written by Erwin Ephron: titled Media Planning
Ephron was named on of the 5 most influential people in media in the past 25 years

28. There are other benefits of Advertising beyond immediate ROAS
Neutralizing effect: No business competes in a vacuum.
Maintaining a current customer base and revenues against competitive advertising “conquesting” designed to take what you’ve got
Maintain share of mind: Share of mind= share of market
Share of mind is accomplished by maintaining a marketing share of voice
Long term Brand building—establish a competitive “firewall”
Long term positive impact of “legacy” advertising- advertising just keeps giving
Impacts other non ROAS metrics necessary for short and long term success
Awareness- only thing that grows in the dark is a mushroom. Business/revenue doesn’t
Intent
Consideration- can’t buy from if your not in their consideration set
Affinity
Advocacy- word-of-mouth- best type of advertising

29. Studies conducted while at Katz: Advertisers see lifts in 5 key branding metrics when Radio is used in marketing campaigns
Average % Lift:
Radio-targeted consumers vs. Control groups
Awareness
+ 17%
Consideration
+ 23%
Purchase Intent
+ 19%
Affinity / Likeability
+ 38%
Advocacy
+ 37%
Source: Radio Advertising Effectiveness Program, Ipsos OTX, ; conducted for Katz Marketing Solutions.

30. Creative can account for as much as 75% of a campaign’s impact Creative can make 100 GRPs perform like 200 GRPs or 50 GRPs
Likeable
Emotive
Factual
Informative
Motivating
Differentiating
Average of Top Quintile
56%
45%
72%
69%
42%
43%
Average of Bottom Quintile
26%
15%
25%
20%
13%
14%
Buy
Believable
Soft Sell
Share
Talking 2 Me
Entertaining
Average of top ads
70%
85%
50%
58%
75%
Average of Bottom Ads
27%
52%
19%
41%
35%
To be read: the top ranked commercials on average were ranked as likeable by 56% of the respondents vs the bottom ranked averaging 26%.
“The most expensive cost in advertising is the cost of running creative that doesn’t work.”
- Erwin Ephron
Creative- Yes, it's a subjective call that can be argued. But listen to locally-produced commercials today and you don't need to compare them to anything to say they're bad
If you don't change the message on a format by format basis, then your message plays to the lowest common denominator, which defeats the purpose of being targeted with your media vehicles  

31. Need some world class creative ideas?
Good artists borrow, great ones steal
Go to:
and search archives - you can search by category, advertiser, year, etc.

32. Practice discussing and presenting this info. Any questions, just call
Summary
$17:1 ROAS Department stores
$17: ROAS Retailers- Key local account
$14:1 Telecom
Beats TV
Other studies on the way
Additional benefit of Advertising: Neutralizing conquesting, SOV, SOM, branding
Dramatically impact 5 key brand health metrics- awareness, intent, consideration
Practice discussing and presenting this info. Any questions, just call

33. bob@uppingthevolume.com Cell: 203-585-7815
Questions
Cell: