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Can AM/FM Ads Build Auto Brands As Well As Drive Dealer Sales? New Research Says Yes.

Auto manufacturers dependent on television advertising to drive brand equity, due to the perceived strength of the combination of visual image, sound and motion, are overlooking AM/FM radio's ability to build car brands in addition to bringing current buyers to dealers. That's the main takeaway from several research studies analyzed in the latest blog from Westwood One.

“AM/FM radio is miscast solely as a sales activation media platform,” Cumulus Media/Westwood One Audio Active Group Chief Insights Officer Pierre Bouvard says. “Auto makers tell AM/FM radio broadcasters, 'our dealers love you,' implying AM/FM radio’s only use case is local dealer sales events.”

Just-released data from a study of 59 national campaigns for auto brands such as Toyota, Honda, Nissan and BMW, conducted by data analysis agency Colourtext along with UK radio industry group Radiocentre and its Big Audio Datamine division, shows that AM/FM radio ads drove increases in advertising awareness (88%), brand relevance (33%), brand trust (32%) and brand consideration (31%).

Additionally, AM/FM radio increased the efficiency of automotive media plans, generating increases in ad awareness, brand relevance and brand trust from four to eleven times greater than its share of media spend. Put another way, says Bouvard, “AM/FM radio clearly punches above its weight.”

Westwood One also cites Nielsen Scarborough data showing how the profile of U.S. consumers intending to buy a new vehicle in the next 12 months closely matches that of heavy AM/FM listeners as well as heavy podcasts listeners and internet users, while the heavy TV viewer profile indexes far lower in terms of full-time employment, household income and miles traveled in a vehicle. Based on the research, heavy AM/FM listeners are 19% more likely to be in the market for a new vehicle in the next year. “If you want to find where the auto intenders are, you'll find them with heavy digital, heavy audio consumers in this country,” Bouvard says.

But how to counter big auto's argument that TV's sight, sound and motion are necessary to drive greater brand equity and sales vs. just audio? Yet another study, from ad effectiveness researchers ABX, shows that based on 2,800 radio and 10,700 TV ads, TV's ad effectiveness is only 8% better than AM/FM's – or, radio creative effectiveness is 92% of TV's – at four times the CPM. “The superiority of sight, sound and motion is basically a myth,” Bouvard says, pointing to a Nielsen study showing that TV ads are not actually seen more than 60% of the time. Viewers are out of the room 21% of the time, and 40% of the time, the ads are heard but consumers are looking away at their phone or second screen. “So, in other words, they're basically radio ads,” Bouvard says.

All the above begs the question, what happens when some of the spend on TV is moved to AM/FM radio? Using media optimization platform Nielsen Media Impact, shifting 20% of the TV spend to AM/FM doubles the reach of adults 25-54 intending to buy a new vehicle, with lifts as high as 243% for Buick and 96% for Chrysler. “Often the excuse for not doing this is the need for sight, sound, and motion that TV provides and, in many cases, the lack of confidence in AM/FM radio creative’s ability to move the needle,” ABX President Gary Gatto says, “but extensive ABX data shows that AM/FM radio can be nearly as effective as television when best practices in audio creative are followed.”

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