ARE INSTITUTIONAL RADIO ADS A WISE INVESTMENT?

Here’s a question I’m often asked, in my role as a radio advertising expert who insists that effective radio advertising requires radio commercials that make money for the advertiser:

“But what about ‘institutional’ or ‘image’ advertising?”

Yes, there are some advertisers who are foolish enough to throw their money away on “image” advertising:  The local bank that has sponsored the 12 o’clock newscast for the past 50 years…without once changing the advertising copy. They don’t care about listener response.

There’s an oft-repeated story that I have seen attributed to at least three different 20th Century businessmen. You might have heard it: The business owner who supposedly said, “Half of my advertising is wasted. My problem is I don’t know which is the wasted half.”

For most businesses, that remains the standard: They have no idea which of their advertising works and which is a waste of money…And, shockingly, that doesn’t seem to bother them; they’re quite content to throw away half of the money they spend on advertising.

If they took the time to find out which half of their advertising works and which doesn’t, they could either eliminate the nonproductive half and save half of the ad budgets…Or they could replace the nonproductive half with productive advertising and double the return on their investment.

If you run a radio station that has a client like that local bank that sends you a check each month for unfocused, unproductive “image” advertising, a client that is happy to throw the company’s money away, it’s okay to take it. But few businesses voluntarily waste money. Most advertisers purchase advertising because they want it to make money for them. Most businesses cannot afford to advertise unless their advertising brings in more money than it costs.