The prospect of advertising on Internet radio stations may have
seemed far-fetched last year; many marketers decided to spend their
online dollars on banner ads instead. But given the disappointing
click-through rates for mute banners, Internet radio ads have
suddenly become more appealing.
Although Internet radio is still in its infancy, it's
quickly gaining in popularity. In fact, the results from a recent
survey by media research firm Arbitron indicate the medium will get
a considerably larger chunk of overall Internet ad dollars in the
next three years, given that the number of Americans who've
listened to online radio grew from 6 to 20 percent between 1998 and
2000. By 2005, about 41 percent of the population is expected to
tune in to Internet radio at least once per week, according to
Forrester Research.
Not surprisingly, the steady rise in listeners has attracted the
attention of marketers like Shane Jones, 25-year-old president and
CEO of Seattle's eProject.com. His project management and collaboration
software company's marketing strategy has included running
audio commercials on King.org, the online streaming version of
Seattle's classical music station, King FM (98.1). Jones
believed the station's 272,000 monthly online
listeners—mostly young and middle-aged professionals with
average incomes of $66,000—were an ideal demographic match
for his company's products. He was right: During a recent
six-month campaign, his firm signed up more than 75 new users each
week and drew customers from 35 states and 18 countries. The cost
per acquisition? About 50 percent less than traditional
advertising—print, sponsorships, online banners, regular
radio and so on.
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For Jones, that meant a savings of $10 per acquisition. But
besides the low price, he says he chose the medium because he
wanted to reach an active audience worldwide—people who are
at their work or home computers and in a position to try the
software right then and there. "With our spot running every
hour," he explains, "we could hit the same listener four
to eight times per day, giving us great brand
recognition."
If you own a dotcom or if you think Internet users would
consider your business interesting, Web radio ads may be the
perfect way for you to advertise. Of course, now you face the
dizzying task of choosing the right online radio station. With
approximately 5,000 of them out there, you may want to turn to a
Web media company for help. Two major players that can provide
assistance are Agency.com and Zenith Media.
Their services can be costly, however, so if money is tight,
search the Web yourself or network to find a media-buying company
that offers the services you need at a price that's
better-suited to your budget. Or select a local radio station with
a demographic profile that matches your product or service. Then
all you have to do is write the ad copy—your radio station
partner will do the rest.
With broadband access and other technologies becoming more
widely available, now is a good time to start taking Net radio
seriously. What's more, it's poised to meet the mainstream.
Expect appliances currently under development—such as
stand-alone Internet radios or software that converts conventional
stereos into Internet streaming machines—to push listeners
and advertisers your way.