(click thumbnail)Jim WoodsQ: In 2006 Google made news by moving into the “radio space” and launching a way for advertisers to launch radio campaigns via an online interface. How successful has that been, and what is Google’s goal for radio in coming months?
A. As part of the Google AdSense program, which connects participating content publishers (in our case, radio broadcasters) to Google’s vast network of advertisers, Google Audio Ads provides an online interface and set of tools for creating, managing, reconciling and measuring the effectiveness of radio advertising campaigns. Through the program, radio broadcasters can simply and easily manage their relationship with both new and existing advertisers marketing on their stations.
We launched Audio Ads in June of 2007. Since then, we have experienced steady growth in both new advertisers and revenues, run thousands of audio campaigns, and are pleased with the progress of the product on both the advertiser and broadcaster sides thus far. We are still in the early days and learning a great deal from various activities, trials and initiatives. As with all new ideas, we adapt and adjust as we go forward and continue to iterate on the both the Audio Ads and AdSense for audio products.
The march toward accountable advertising is clearly underway and unstoppable. Marketers are demanding more transparency in measuring the results of their advertising spending across all mediums. Google Audio Ad’s vision is to deliver new efficiencies and capabilities to radio advertisers, which enable better targeting and the ability to measure effectiveness more easily than has ever been possible. With respect to targeting, we provide geographic and demographic targeting as well as automated event-based targeting. This coupled with ad effectiveness tools, which correlate online activity to radio ad plays, make Google Audio Ads a new and unique way for both the active and new to radio advertisers to reach their audiences. As these new advertisers discover radio, and see its impact via our performance tracking tools, we believe more and more new advertisers will leverage radio as a key part of their marketing spend.
Q: How many radio stations are now part of the Audio Ads system? What major groups?
A. Our network consists of over 1,600 stations, which reaches over 49% of the 12+ audience every week. These stations are of all sizes, formats and part of groups as diverse as Clear Channel, Emmis, Nassau, Max Media, Rubber City, Renda, New Northwest and many more. We have stations in all DMAs and top tier stations in the top 50 markets.
Q: Some early critics said Google’s involvement in how radio ads are sold could drive down ad rates and stunt revenue growth. What has been the real-world experience since then?
A. Our system offers advertisers two pricing options: reservation and auction bidding. Through the reservation process, advertisers can build a campaign and reserve the inventory immediately at a set price. With this option, our experience is the CPMs are comparable to current network market rates.
If the advertiser chooses the auction option, then market demand sets the price. We run the auction every night and allocate the demand against the supply we have for the following day. Our experience so far is about evenly split. Frankly, where we see demand and have advertisers competing within the auction, we see rates increasing. Where there is limited demand, there will obviously be less price pressure in an auction environment.
Overall, we continue to believe as we draw more and more advertisers to the audio ads platform, we will see increasing rates with increasing demand. So the real question is, “Are we attracting new advertisers to radio?” And the answer is yes. As a result of our simple interface and set-up process, we’re seeing businesses who have never used or even thought about offline marketing adopt and succeed in radio advertising. We have a sampling of some of our advertisers who saw an impact to their business using Audio Ads, at http://www.google.com/adwords/audioads/casestudy.html.
Q: What’s new that you will show at the 2008 NAB Show and that radio broadcasters should look for there?
A. We are excited to demonstrate all three parts of our system – Google Audio Ads, AdSense for Audio and Google Radio Automation – at this year’s NAB show. Our presentations focus on our goals of bringing new efficiency, accountability and effectiveness to the buying and selling of radio advertising.
Google Radio Automation (GRA) will be revealed for the first time at this year’s NAB. GRA will be the first third generation radio automation system in the industry. In addition to recasting the functionality currently available in both SS32 and Maestro (our current products), it will feature the industry’s first service-based architecture. Each component (playlist, database, inventory, etc.) will be wrapped with a public interface (API), enabling our broadcast partners to extend the functionality of the automation in ways never before possible. This allows third parties (equipment manufacturers, software providers, etc.) to be able to write custom applications to run inside the automation platform, enabling them to integrate their products with the automation system at an unprecedented level.
Recognizing that radio broadcasters are content producers and that their content, which will be distributed across a variety of platforms, needs to be monetized, GRA will feature seamlessly integrated support for all these content streams. Terrestrial stations, web streams, podcasts and HD channels will all be synchronized within one fully customizable platform, with unmatched ease of use.
At NAB, we will also demonstrate our new “Management Console,” which provides broadcasters who are part of AdSense for Audio program enhanced visibility into their account. We have a new interface, which is now even more intuitive and easy to navigate. The Management Console is a broadcaster’s window into their advertisers with enhanced capabilities to review and reject ads, rates, etc. It also adds significant new reporting functionality. Finally, we recently announced an updated and improved version of the Google Audio Ads front end, which adds significant new targeting functionality. An advertiser will be able to trigger a campaign or change the ad creative based on an external factor, such as weather. As with every improvement to Audio Ads, we listen to the feedback from our advertisers and use it to inform our efforts of making buying radio through Google easier and more accountable.
Q: Is radio automation still a significant part of your business? Who are some recent users of Maestro and SS32?
A. Yes, the automation business is still a key part of our business, and we have demonstrated its importance with the investment we’ve made in developing our new automation system. We believe our launch of the new Google Radio Automation as an important enabler for broadcasters to continue to improve their operations while also launching new services – which also need to be effectively and efficiently monetized.
We continue to enjoy the largest installed base of automation systems (between SS32 and Maestro) in North America. Recently, Greater Media in Philadelphia, the Motor Racing Network, the Luis Jimenez Show in NYC (Univision), the Michael Baisden Show (ABC Radio Networks) and Great American Country Network have all adopted Google Automation.
Q: Where are the radio-related operations of Google based, and how many employees are in that part of the business?
A. Our Google Audio Ads team is located in Mountain View, Irvine, New York, Dallas and Kansas City. We don’t publicly release employee numbers by group.
Q: Anything else we should know about the company’s business direction or new products?
A. Google’s vision is driven by a strong commitment to all of our users – be they search users, radio staff or advertisers. We have an unquestioned dedication to doing what is right by our users, and radio broadcasters can expect to see that core value reflected in the investments we have made (and continue to make) in the radio industry.
We see traditional media, particularly radio, as an important complement to online advertising. We particularly hope to share this perspective with those who – for whatever reason – haven’t previously considered radio. Our vision is to make building, launching, managing, measuring and optimizing radio advertising as simple, efficient and measurable as possible. Providing the necessary tools to link a marketer’s spending all together will attract new advertisers to the industry and promote market growth for everyone.
We don’t see any of this as optional. Marketers are demanding it.