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Marketers with national brands are learning to love satellite radio because it can be a great way to take a small budget and do big things with it.
Satellite radio is nationwide and provides a format for every listener and for every advertiser. A satellite radio campaign can be more cost effective to produce, air and manage than a national TV or local AM/FM radio campaign.
Satellite radio includes two major players: XM Satellite Radio and SIRIUS Radio. Both offer over a hundred mass appeal and niche programming channels. Both offer subscribers Internet-based listening options. Both partner with automobile and car stereo manufacturers to make their hardware more accessible to consumers. As a result, both companies are reporting significant subscriber growth.
XM offers more than 160 digital channels of music, news, talk, radio, sports, comedy and children's programming. In April, 2006, XM announced that it surpassed 6.5 million subscribers nationwide. SIRIUS offers over 125 digital channels of satellite radio: 67 devoted to commercial-free music and 61 channels of sports, news, talk, entertainment, traffic, weather and data. In March 2006, SIRIUS announced that it surpassed 4 million subscribers nationwide.
Although both XM and SIRIUS are know for providing channels of uninterrupted music, each contains a wide array of talk radio stations that include advertising.
For comparison, we created test campaigns on both SIRIUS and XM and found comparable results. The typical cost per 30-second spot on SIRIUS radio talk channels, excluding Howard Stern, was around $40 per spot. SIRIUS traffic and weather channels averaged $8 for each per 15-second spot. On XM, spots on the same networks averaged $55 per 30-second spot.
Since there is limited overlap among XM and SIRIUS subscribers, marketers can maximize their national reach by advertising on each.Satellite radio subscribers
Most people subscribe to satellite radio because they don't like AM/FM offerings in their local community. According to a 2005 study of 500 satellite radio users by Eldon University, the most frequently mentioned reason cited by enthusiasts for adopting satellite radio was dissatisfaction with the programming on AM/FM radio. The study said that satisfaction among satellite radio enthusiasts is very high. 98 percent indicated they are "very satisfied" or "satisfied" with the service. They enjoyed satellite radio's commercial-free environment, variety of music, quality of satellite radio's audio signal and widespread signal coverage.
Who subscribes to satellite radio? More than you'd think. In a January, 2006, survey of more than 1,000 households from American Media Services (AMS), about 12 percent of Americans said they subscribe to satellite radio and 18 percent of say they are likely to subscribe to paid satellite radio.
According to a 2005 survey by MarketStar, 18-34 year olds are the strongest subscriber base for satellite radio. The survey concluded that 4.2 percent of adult consumers said they subscribed to one of the satellite radio services in 2005.
An additional 16.1 percent said they plan to subscribe someday. Of those people who said they plan to subscribe, 28.7 percent said they would subscribe to SIRIUS, 16.7 percent said XM and 54.6 percent were undecided about which service they would choose. XM was the top pick for 18-24 year olds. SIRIUS was #1 for all other age groups in the MarketStar survey.
As people learn more about satellite radio, their likelihood of subscribing may increase. According to the MarketStar survey, 22.7 percent of respondents ages 35 to 44 (and 24.3 percent of participants ages 45 to 54) said they didn't know enough about the service.Writing for radio
Marketers often work with an ad agency or radio station to produce ads. Both SIRIUS and XM radio have the ability to produce radio ads for marketers. In fact, the recording studios and talent provided by Sirius or XM will likely surpass the quality of producers in your local market. During a recent test campaign, we provided SIRIUS with three radio scripts which they produced to our specs (with voice talent, sound affects and music) in less than a week.
The better a marketer knows radio, the more effective their radio spot will be. Marketers have to deliver their brand message through words, voices, sounds and music - without pictures. This means that creating a good radio spot depends on your ability to tell the right story. Here are some general tips.Keep things simple:
Radio is better at increasing your brand awareness than it is at describing everything someone may want to know about your company or its products. You've got only 60, 30 or 15 seconds to communicate your brand. Stick to one idea. Begin with something relevant, but unexpected to gain a listeners attention. End with something memorable.Write for the ear:
Radio is uniquely nonvisual. Copy that works well in a print ad or the voiceover for a TV commercial can sound dreadful when read aloud. When you create a radio commercial, think in terms of sound rather than words. Say it again:
Since your unable to display a company logo or show products on radio the way you can in print or TV, it's a good idea to repeat the name of your company or product throughout your commercial. As a general rule, a spot should include the brand name at least three times.Personalize your message:
Tailor your commercial to time, place, and specific listeners. If its running during the morning commute, take advantage of knowing that individuals are likely in their cars. A spot that works on ESPN may not work equally well on CNN or ABC News radio. Avoid Numbers:
One of the advantages of advertising on satellite radio, is that both SIRIUS and XM allow you display a message on the LED display of their receiver. This means that you can show your company's website address or toll-free phone number during the duration of the ad. Since it's unlikely that individuals will remember a spoken telephone number in a commercial or have a pen and paper handy when listening to your ad. Consider sending individuals to your web site rather than to your phone. Or, if you must include a telephone number consider a vanity number that spells a memorable word or phrase associated with your business.
Satellite radio provides a new national radio platform for many advertisers. Satellite radio offers expanded program choices, coast-to-coast coverage and the ability for advertisers to effectively reach specific audiences in a cost-effective way in the mobile environment.
With the ability to reach radio audiences nationwide, satellite radio provides the kind of targeted national, mass-market radio buy that many marketers are looking for.
Troy Janisch is president and founder of the Icon Interactive Group (www.iconinteractive.com
), an industry leader helping companies integrate Internet and other Interactive media into sales channels, marketing strategies, and overall branding. He can be contacted by e-mail at firstname.lastname@example.org
The opinions expressed herein or statements made in the above column are solely those of the author, and do not necessarily reflect the views of Wisconsin Technology Network, LLC. (WTN). WTN, LLC accepts no legal liability or responsibility for any claims made or opinions expressed herein.