It is obvious to anyone who tries to listen to commercial radio – especially stations owned by the huge chains like Clear Channel – that they are stuffed to the gills with ads, so much so that even the advertisers and Wall Street have been complaining. Surprise, surprise! When the flood of revenues are threatened – as opposed to the vociferous complaints of mere mortals like listeners – then suddenly Clear Channel sings a different tune, er, jingle:
- John E. Hogan, chief executive at Clear Channel Radio, which is based in San Antonio, said the sprawl of commercials throughout radio was causing clear harm. “If you have listened to the radio at all, you know that there is an amazing amount of commercial and promotional inventory,” he said. “So much so that we have run the risk of diluting our product.”
Reaching for the tuner as soon as a D.J. says “Don’t touch that dial” is almost instinctual for many listeners, a fact that radio executives could accept when revenue was soaring, like it last did during the dot-com boom.
But revenue since then has expanded with something like the speed of a sloth, with combined national and local ad spending growing 4 percent in the first five months of the year, compared with the same period a year earlier, and rising 2 percent in all of 2003, according to the Radio Advertising Bureau.
The slow growth comes despite a long-term run-up in the number of minutes in each hour devoted to commercials, said Laraine Mancini, a broadcasting analyst at Merrill Lynch. “Radio wanted to take every dollar that was getting thrown at them,” she said. “And you didn’t have to produce more to do it; just take a song off and add commercials.”
Solid figures on radio commercials are hard to come by because of the difficulty in monitoring thousands of stations across the country, but Ms. Mancini and others offered rough estimates. Where 10 to 12 minutes of advertising each hour was perhaps the norm a decade ago, some talk-radio stations now broadcast more than 20 minutes of ads an hour, they said. Many music stations probably play more than 15 minutes.
….Mr. Hogan of Clear Channel Radio, which is a unit of Clear Channel Communications, said the company’s new ceilings on ads, while national in scope, would vary according to format and time of day.
For example, during the morning drive, Clear Channel’s country-music stations will broadcast no more than 12 minutes of commercials an hour, take no more than 4 minutes for any single commercial break and pack no more than six commercials into a break.
Such stations have been playing 18 minutes to 24 minutes of ads during the morning drive, Mr. Hogan said. “This is a way for us to go to advertisers and say we’ve heard you. We’re going to give you a better environment,” he added. Enforcement efforts will rely on proprietary technology that will monitor what Clear Channel stations broadcast, he said.
Joseph W. Lenski, executive vice president at Edison Media Research, said the new Clear Channel limits might create pressure for others to do something similar.
….Guy Zapoleon, president at Zapoleon Media Strategies, called the Clear Channel move well-timed given threats like satellite radio and proliferating sources of music and information. [NY Times]
Buh-flipping-doy, Mr. Zapoleon, who is a descendent of both Napoleon and Frank Zappa.
But seriously, they have found the pont at which both listeners and advertisers feel taken advantage of: somewhere around the 12 minute per hour mark, which is still 20% of air time.
Satellite radio is providing much needed competition for commercial radio as well.