RBR+TVBR OBSERVATION
Did that headline grab your attention? Good, because there’s a big opportunity for radio broadcast companies to significantly boost their ad revenue while gaining ground against those digital devils who have supposedly sucked dollar after dollar away from that local AM or FM in markets far and wide.
It involves WPP, one of the world’s largest advertising agency groups, and one of the world’s biggest advertisers, by dollars allocated to all kinds of media.
If you’re not familiar with WPP, let us get you up to speed with a brand as widely known as Delta Air Lines in the advertising world. It’s a multinational conglomerate headquartered in London, and it’s not doing so hot of late.
It owns Kantar, a data and market research unit with a big Latin American presence. That unit is for sale, and WPP wants to sell it all for $4.5 billion or so, give or take the exchange rate between dollars and pounds.
Among the buyout firms kicking the tires for Kantar are Bain Capital and Apollo Global Management, which thanks to deals with Cox Media Group and Brian Brady’s Northwest Broadcasting has become an active acquisitor of TV properties.
The sale of Kantar comes as WPP in late April reported revenue growth at Kantar for the first time since the end of 2016. However, the big picture isn’t as rosy, with WPP struggling. As reported by Bloomberg, a Q1 fall in sales is chiefly due to its North American agencies losing work with their top clients.
Specifically, revenue tumbled by 8.5% in North America, because big consumer groups cut spending on TV and out-of-home to focus more on digital marketing. In October 2018, one of WPP’s biggest clients, Ford Motor Company, shifted its lead creative duties elsewhere.
With WPP shares at $61.13 at Tuesday’s Closing Bell on NYSE, the company has witnessed a dizzying two-year run on Wall Street. On May 1, 2017, WPP was priced at $112.47. By Dec. 3, 2018, shares tumbled to $52.13 before engaging in a mild recovery that’s cooled a bit since the end of April.
What the Bloomberg report failed to mention but was noted in Mumbrella’s Asian editions was a reduction in spending on Facebook, Google and YouTube by 20%-50% from Marc Pritchard, Chief Brand Officer at P&G.
Pritchard has dutifully filled a role formerly held by Jim Stengel, who was revered among many marketing and advertising pros for his prowess. Pritchard has perhaps risen to a whole other level, thanks to his efforts on diversity and inclusion in marketing and across corporations seeking multicultural consumer growth.
He’s also become a champion of rocking the media supply chain. Speaking in April at the Association of National Advertisers (ANA) Media Conference, Pritchard asked his peers to adopt a new media supply chain system in order to fight the “dark side” present within the existing environment.
He said to attendees in Orlando, “It’s time to invest our brainpower into an ecosystem that builds in quality, civility, transparency, privacy and control from the very start. A new media supply chain that levels the playing field and operates in a way that is clean, efficient, accountable and properly moderated for everyone involved.”
This should very much involve Radio.
“Digital media continues to grow exponentially, and with it, a dark side persists, and in some cases, has gotten worse,” he said. “Waste continues to exist from lack of transparency and fraud. Seven out of 10 consumers say ads are annoying, and ad blocking is accelerating. Privacy breaches and consumer data misuse keeps occurring. Unacceptable content continues to be available and is still being viewed alongside our brands.”
With good creative and the ability to be non-intrusive, Radio can overcome ad blocking technologies through its superior reach. Perhaps David Field at Entercom can voice this ad industry PSA on behalf of the Radio Advertising Bureau and Erica Farber & Co.
Fraud? Since when has Radio been accused of ad fraud?
For Pritchard, creating this new supply chain involves five steps — elevating quality, promoting civility, leveling the playing field, simplifying privacy and taking control.
That’s what Radio can easily excel at. Now is the time for the industry to collectively respond.
For Pritchard, the goal is to encourage marketers, as AdWeek reports, to only partner with companies with high-quality content that reflects their values, creating a balanced and productive discussion around editorial content, demanding transparency across all media platforms, respecting and prioritizing consumers’ privacy and using the data they have at their disposal to make smarter decisions.
That’s Radio.
Now, let’s convince Pritchard’s peers of it. When Pritchard cut $200 million out of online marketing budgets, P&G reinvested into areas with “media reach” — including audio and television.
Podcasts are sexy. Radio sells.
Let’s go get some ad dollars.
Adam R Jacobson serves as the editor-in-chief of the Radio + Television Business Report. RBR+TVBR Observations, created by the publication’s founder, are viewpoints reflecting the editorial staff of RBR+TVBR and RBR.com and not of its management or other Streamline Publishing titles.
