Radiocentre says brands can make more profit from the same money by moving a slice of their search and social spend into audio. The research is built on big-brand budgets, but the idea is cheap to test, and late-space radio is the cheapest way to test it.
What’s happened
On 30 September Radiocentre, the industry body for commercial radio, published a study called Sound Profits, with the modelling done by WPP Media. According to Radiocentre, moving 10% of a generic paid search budget into audio lifted what it calls full-term profit return on investment by 8% and moving 20% lifted it by 16%, while for paid social the gains were 11% and 21%. The brands in the study had an average annual media budget of £12.7m, and at that size Radiocentre puts the prize at about £1m of extra profit from shifting 15% of generic search or 20% of paid social. A companion survey of 6,000 UK adults by Differentology found that people hold back from clicking online ads when they do not know or trust the brand behind them.
Why it matters to claims firms, auction houses and promoters
Start with the caveats. Radiocentre exists to promote commercial radio, so read this as a well-argued case, not a neutral verdict. The brands behind the numbers spend an average of £12.7m a year, and nobody running a regional saleroom or a claims firm should expect a million pounds to fall out of the radio. These are modelled averages across large advertisers, not a promise to any one of them.
The reasoning does match what we see when we buy for clients, though. Generic search, the clicks you buy on general terms such as “injury claim” or “antiques valuation” instead of on your own name, finds people who are already looking. It does not make them choose you. When four firms appear above the results, the click tends to go to a name the searcher has heard before. That is why a claims firm can raise its bids month after month without its cost per enquiry improving.
The same applies to an auction house chasing consignments or a promoter selling tickets against a fight date. Search and social can only harvest the interest that exists on the day. Radio puts the name and the date into people’s heads beforehand, so more of them go looking for you by name, and clicks on your own name are usually the cheapest you can buy.
There is a price point too. As we wrote in our piece on UK digital adspend this week, search and social are sold by auction and tend to cost more as they get busier. Radio airtime works the other way: a break that is still unsold close to transmission is worth nothing to the station once it has passed, so the price comes down.
This is what we do for clients. We look at what your generic search and paid social cost per enquiry, take a small share of that budget, and go to the station sales teams to find the airtime that is still unsold in the areas where you trade. We negotiate it late, station by station, so the test costs less than rate card, and we set it up so that you can read the result.
What we’d do
First, split your search spend into two piles: clicks on your own name and clicks on generic terms. Work out the cost per enquiry for each, and do the same for paid social. In many accounts the generic pile is where most of the money goes.
Second, test a tenth, not a half. Move 10% of the generic search or social budget into radio in one region for four to six weeks, and leave everything else alone. Watch three things: searches for your name, calls and direct enquiries, and what the remaining generic clicks cost per enquiry.
Third, buy the test late and keep the ad simple. Say who you are, what you do and one way to respond. Do not judge it on the first week; audio builds familiarity over repeated hearing.
How VCM can help
We find out what a radio test would cost in your area this month, negotiate it late so it comes in under rate card, and plan it alongside your search and social so you can see what it did. Have a look at how we approach radio advertising, then get in touch on 0333 577 1848 or at James@vcmweb.co.uk. Tell us roughly what you spend on search and social and we will tell you what a tenth of it should buy on air right now, no obligation.
