Finally Something Positive About Radio - They Beat Internet Display Ads

A study by Harris Interactive states that one-third of Americans find TV advertising to be more helpful in making purchase decisions than any other medium. According to the study, 37% favor TV ads, 17% favor newspaper ads, and 14% favor Internet search engine ads, while just 3% favor radio ads in making purchase decisions. Here is where radio gets competitive. In a response to the question, which type of ad do you tend to ignore the most, 46% said Internet banner ads are ignored while just 9% ignore radio ads.

Radio finally beats the Internet at something, even though most of radio's ad dollars have found their way online and the stock prices of the radio companies have been decimated as a result. Not sure what this means for the radio companies and I doubt that ad dollars will make their way back to radio.

The study also stated that 17% of Americans ignore Internet search ads, which strikes me as odd given that in most instances, with contextual ads being the exception, both paid and non-paid search ads are only displayed as a result of a query by someone. So it puzzles me why someone would intentionally ask for an ad to be displayed then ignore it. They would look at the ad, see whether it is relevant, and if it is they would click on it, and if not, they would ask for another ad to be displayed through a second search. No where in this process is the ad being ignored by the consumer. I doubt the owners of the survey would be savvy enough to differentiate between traditional online search ads and contextual online search ads, hence, their results are somewhat questionable.

Nonetheless, kudos to the declining radio industry for this win. I continue to be a big fan of radio and listen to it in both my car and at home and often find the ads helpful. The industry has staying power and will be with us for decades and probably for the next century. The same can't be said for the stocks of these companies as most will surely be taken private, voluntarily or involuntarily.

I chose to have nothing to do with the stocks but if you are inclined here is a list of the radio stocks:

Radio One (ROIAK) - $0.70
Cumulus Media (CMLS) - $0.73
Salem Communications (SALM) - $0.899
Entercom Communications (ETM) - $1.45
Sega Communications (SGA) - $5.80
Sirius XM (SIRI) - $0.46
Beasley Broadcast Group (BBGI) - $2.17