Americans can’t wait to get back to life before Covid. And that includes spending a sizeable chunk of all that money they haven’t been spending.
A recent Wall Street Journal article shows Americans have been saving during the pandemic, a by-product of spending more time at home. And while some of that unspent money has been put towards paying down debt and making other responsible choices (like saving for retirement or higher education), much of that treasure chest is just waiting to be spent, rewarding good behavior and indulging cravings to consume, celebrate and travel.
Just look at stock prices of the major airlines, hotels chains and cruise lines. Many fell to less than half their value when Americans slipped into quarantine. Today, most have rebounded to near pre-Covid valuations, as cruise lines and airlines hungrily book reservations for leisure travel in 2021 and beyond.
Advertisers who get out in front of the post-Covid spending spree will be poised to capture a disproportionate share of consumer dollars by being top-of-mind when Americans decide it’s time to book that trip, buy that car or renovate their homes.
For radio advertisers, that means the time to lock in media schedules is now. Rates fell to mirror reduced inventory demand but are now creeping back up again to match renewed interest among marketers. Those who wait will pay top dollar. Those who book time now (with a cancellation option for protection) will lock in better ROI by paying less for the same 30 seconds of airtime an advertiser will pay top dollar for, down the road.
During Covid, AM/FM listening levels dipped a bit, as people spent less time in cars when their daily work commute became a 30-step walk into their home office. But even with a slightly reduced audience, radio’s value is still strong, with complementary alternatives like Podcast sponsorships providing access to celebrity voices and endorsements at a fraction of the price of hiring those same celebrities directly to promote a brand.
The Radio Agency, one of America’s few advertising agencies 100% focused on radio and audio advertising, experienced the full spectrum of client activity during Covid. “Some of our clients pulled their campaigns, for a variety of reasons,” noted Mark Lipsky, CEO of The Radio Agency. “Others maintained or even increased their spending levels, as profitable campaigns justified larger budgets to sustain momentum and scale top-line revenue.”
Beyond the prime Q2 retail season (Easter and Mother’s Day), radio advertising should be affordably-priced – or even discounted – through the summer months. And as Americans in all 50 states venture out to enjoy the fresh air, they are ready and able to spend.
Sports has never witnessed anything like September 2020. If all goes as planned, NFL Football will be playing regular season games at the same time as the NBA Basketball playoffs, NHL Hockey playoffs, Major League Baseball and NCAA Football. September 2020 may attempt to squeeze over 5,000 hours of professional and collegiate sports coverage into a single month.
To the action-starved fan who has been without their favorite teams for months, this will be like giving a thirsty man a case of Gatorade and ordering him to “Drink it all!”
SportsTalk radio stations, presently fumbling to fill 24 hours a day with programming content that can’t reference last night’s loss or tonight’s chance to rebound, will be overflowing with conversation topics and play-by-play coverage.
It’ll be Sports Heaven, unless you’re an advertiser.
There are only so many minutes of advertising (14-20) a SportsRadio station or network can cram into one hour before programming content becomes unlistenable. And radio stations and networks will be testing that limit in an effort to recoup some of their lost sales from spring.
Advertisers will be shocked by higher-than-usual prices, as demand for inventory boosts the price of air time to record levels. Beyond in-game announcements and sponsorships of everything from the Play of the Week Replay to Studio Naming Rights, there will be a mad scramble to lock in schedules before the advertising inventory runs out.
Those taking a wait-and-see attitude to plan their fall sports advertising, may end up outside the stadium looking in. It’s also likely that some advertisers that book schedules at discounted rates may find themselves “bumped” when a national advertiser shows up willing to pay double what they’ve offered for that same air time.
So what are the smartest moves an advertiser can make right now?
Start planning. Allocate budgets and determine which teams and which advertising assets are the best fits to reach the target audience.
Assess risk. Is it wiser to lock in a schedule guaranteed to run at a premium rate? Or does it make more sense to negotiate lower rates and take the risk of getting bumped when someone offers to pay more?
Beyond conventional advertising, explore which station programming features can be sponsored, enabling a brand to elevate its status and be more memorable.
Above all, start planning now to survive and thrive from the coming sports apocalypse. Game on.
Mark Lipsky is CEO and Creative Director at The Radio Agency, a national advertising agency 100% focused on creating and managing sound advertising campaigns through the medium of radio. You can reach him at Mark@TheRadioAgency.com.