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Internet RadioAdvertising Impact StudyA Parks Associates white paper developed forForewords Provided By:
White Paper Internet Radio Advertising Impact StudyA Paradigm ShiftforewordNo advertising medium exists in a vacuum. As marketers increasingly consider advertisingcampaigns holistically, measuring impact and effectiveness across media is an ever-larger priorityfor the industry. Of course, the measurement of cross-media ad effectiveness only grows morecomplex as media themselves diversify, as digital media become more central, and as media plans become more subtle.Over seven years ago, the Interactive Advertising Bureau launched a pioneering series of studies, the Cross MediaOptimization Studies (or “XMOS”) that were among the first public, real-world, quantitative assessments of thecontributions, individually and collectively, of individual media to total advertising campaign return on marketinginvestment. These studies, still an important benchmark in the industry, form a foundation that many others across theecosystem have built on over the years.The IAB views this new TargetSpot study in the spirit of furthering understanding of cross-media advertising impact.This paper presents evidence for the power of Internet Radio advertising to increase the effectiveness of both digital(Internet) and Broadcast Radio ads. The IAB hopes these findings encourage marketers to think holistically about theiradvertising campaigns, and explore and take advantage of the synergistic benefits of well conceived and executedcross-media advertising campaigns, including digital audio.Joe Laszlo, Deputy Director, Interactive Advertising BureauRAB is pleased to introduce TargetSpot’s important new research on the multiplier effect ofInternet Radio advertising combined with Broadcast Radio schedules.While providing new insights into the synergies that exist among Broadcast Radio and anexpanding array of digital audio platforms, TargetSpot’s Internet Radio Advertising Impact Studyalso reinforces findings of earlier Radio Ad Lab studies1 on the powerful synergy that occurswhen Radio and its digital platforms are used within any given media plan: Radio and the Internet have complementary roles in a media plan Ad recall drastically improves when Radio and digital platforms are used in tandem A positive impact on brand preference, purchase behavior Increases in advertised brand website visitationThe positive results of the Internet Radio Advertising Impact Study, evident across multiple ad categories are illustrated.The addition of Internet Radio listening impacts Broadcast Radio ad response rates more than any incremental increasein time spent with Broadcast Radio alone.As marketers increasingly gravitate to the Internet, this study makes a clear case for Internet Radio and Broadcast Radioas a key component in an effective media plan.Radio Advertising Bureau1Source: Radio Ad Lab & The PreTesting Company, Inc., The Benefits of Synergy: Moving Money Into Radio, 2004Source: Radio Ad Lab & Harris Interactive, Inc., Radio and the Internet: Powerful Complements for Advertisers, 2007 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.1
White Paper Internet Radio Advertising Impact StudyRESEARCH OBJECTIVESTargetSpot set out to quantify the additive value of Internet Radio advertising when combined with either Onlineadvertising or with Broadcast Radio advertising. The research provides a statistical analysis of the increase in advertisingimpact when including Internet Radio advertising with either of these media.Internet Radio includes both online-only Radio stationsand Broadcast Radio stations streamed on a computer,mobile/smartphone, or tablet deviceKEY FINDINGS: INTERNET RADIO USE INCREASES BOTH AD RECALL ANDAD RESPONSEInternet Radio advertising is effective both on its own and in combination with Online advertising or with traditionalBroadcast Radio advertising Online and Broadcast Radio advertising response rates increase 2 to 3.5x among consumers who also listento Internet Radio. The addition of Internet Radio use contributes more to increased ad response of both Online advertising andBroadcast Radio advertising than increased usage of those media. Specific brand or ad category recall and response improve when Internet Radio is combined with an Online orBroadcast Radio campaign. 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.2
White Paper Internet Radio Advertising Impact StudyINTERNET RADIO INCREASES ONLINE ADVERTISING EFFECTIVENESSWeekly Online use is higher among those who also listen to Internet Radio, demonstrating Internet Radio usecomplements Online usage (Figure 1).The Most Engaged Internet Users are those who Also Use Internet RadioWeekly Online UseFigure 11-7 hoursInternetFigureONLY1 users (n 684)INTERNET RADIO Listeners (n 812)Internet ONLY users (n 684)8%19%1-7 hours9% 16%8% 19%8-14 hours30%15-21 hours26%30%100%26%49%Source: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks Associates0%22 hours49%43%50%9% 16%22 hours43%8-14 hours0%INTERNET RADIO Listeners (n 812)15-21 hours50%100%Online ad recall andSource:responserates significantly increase when combined with Internet Radio use (Figure 2). The dataTargetSpot Internet Radio Advertising Impact Study 2011TargetSpot,Inc. —RadioResearchareby ParksAssociatesreveal that users wholistento Internettwiceas likely as Internet-only users to respond to an Online ad.Figure 2Internet Radio100% Use Increases Ad Recall and Ad Response of Online AdvertisingInternet ONLY UsersINTERNET RADIO ListenersInternet ONLY UsersINTERNET RADIO ListenersFigure 275%100%50%75%2x25%50%2x0%25%Recall1 Ad0%Recall1 AdRecall 1 Product/ServiceCategory(Aided)Recall1 Recall 1 Product/ServiceCategory(Unaided)Recall 1 Product/Product/ServiceServiceSource: TargetSpot Internet Radio Advertising ImpactStudyCategoryCategory 2011 TargetSpot, Inc. — Researchby Parks Associates(Aided)(Unaided)Recall 1 Brands(Aided)Recall 1 Brands(Unaided)Respondedto AdRecall 1 Brands(Aided)Recall 1 Brands(Unaided)Respondedto AdFigureTargetSpot3Source:Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by ParksAssociates2011TargetSpot, Inc. — Research by Parks Associates All rights reserved.20%18%adFigure16% 33
2xWhite Paper Internet Radio Advertising Impact Study25%0%Recall1 AdRecall 1 Recall 1 Recall 1 Recall 1 RespondedProduct/Product/BrandsBrandstobroad,AdThe positive impact of Internet Radio listenership on Online ad response is significant as well asand it influencesServiceService(Aided)(Unaided)both online and offline actions—well beyondthe clickCategory(Figure 3). Online ad response increases up to 5x among usersCategory(Aided)(Unaided)who also listen to Internet Radio.Source: TargetSpot Internet Radio Advertising Impact Study2011 TargetSpot,Inc. —OnlineResearch by AdParks Responses,AssociatesInternet Radio UseIncreasesAcross the Board: Online and OfflineFigure 320%% responding to ONLINE ad18%16%14%12%INTERNET RADIO Listeners10%8%2.7x6%5x4%Internet ONLY Users5x2%0%Became a Called for Sent“fan” on a information email/socialtextnetworkingwebsitesPurchased Purchased ClickedVisitedSearchedproduct/ product/on ad advertiser's for moreserviceservicewebsite informationonlineat retailonlineSource: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 4insurancetravel-airlines, hotels, car rental, etc.86%of respondents listen to both pure-play Internetrestaurants% of Internet usersRadio and AM/FM simulcast Internet whoRadiolisten tostationsconsumer electronics1.9xautomotiveINTERNET RADIOand recall the SAMEproduct/servicecategory advertisedon both mediafinancial servicesentertainment/mediaretail storesfood productscomputers/software2x% of Internet ONLYusers who recall anadvertisedproduct/servicecategory 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.2.3x4
% respon8%2.7x6%5x4%Internet ONLY UsersWhite5x Paper Internet Radio Advertising Impact Study2%0%Became a Called for Sent Purchased Purchased ClickedVisitedSearched“fan” on a information email/ product/ product/on ad advertiser's for moresocialtextservicewebsite informationThe synergy of cross-media advertisingon both InternetRadio and serviceOnline is evident whenquantifying ad recall ratesnetworkingonlineat retailonlineof key product/service categorieswebsites(Figure 4).Source: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot,Inc.Impact:— Research byParks AssociatesInternetRadioRecallof Online Ads Increases up to 2.3xFigure 4insurancetravel-airlines, hotels, car rental, etc.restaurantsconsumer electronics1.9xautomotive% of Internet userswho listen toINTERNET RADIOand recall the SAMEproduct/servicecategory advertisedon both mediafinancial servicesentertainment/media2xretail stores% of Internet ONLYusers who recall anadvertisedproduct/servicecategoryfood products2.3xcomputers/software0%60%30%% that recall ad category on the InternetSource: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 560%% responding to ONLINE ad50%INTERNET RADIO Listeners40%30%28%Internet ONLY Users26%20%10% 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.50%1-10 hours11-20 hours21-30 hours31 hours
on both mediafinancial servicesWhite Paper Internet Radio Advertising Impact %Studyof Internet ONLYusers who recall tegoryretail storesproductsThe addition of Internet Radiofoodlisteningimpacts Online ad response rates more than any incremental increase in timespent Online alone.2.3xcomputers/softwareThis profound synergistic impact is evident even among users listening to Internet Radio for 1 to 10 hours per week.The addition of Internet Radio boosts ad responserates by a greaterpercentage than increasingOnline usage time by30%60%0%3x or more (Figure 5).% that recall ad category on the InternetSource: TargetSpot Internet Radio Advertising Impact StudyAddingInternetImpacts Online Ad Response 2011 TargetSpot,Inc. Radio— ResearchListeningby Parks AssociatesMore Than Increasing Online UsageFigure 560%% responding to ONLINE ad50%INTERNET RADIO Listeners40%30%Internet ONLY Users28%26%20%10%0%1-10 hours11-20 hours21-30 hours31 hoursWeekly Time Spent Using InternetSource: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 61-7 hoursBROADCAST RADIO Listeners ONLYUsers who (n 1009)spend8-14 hours67%15 hours18%16%the minimal amount of time listeningInternethad higherad responseratesthanBROADCAST toRADIO& INTERNET RadioRADIO55%28%17%Listeners (n 812)heavy Internet only users0%50%100%Source: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 7100% 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.BROADCAST RADIOListeners ONLYBROADCAST RADIO & INTERNETRADIO Listeners6
% responding to ONLINE ad% responding to ONLIFigure40%560%White Paper Internet Radio Advertising Impact Study30%50%Internet ONLY Users28%26%20% INTERNET RADIO Listeners40%10%INTERNET RADIO30% ENHANCES BROADCAST RADIO’S ADVERTISINGInternet ONLY UsersEFFECTIVENESS 0%28%20%1-10 hours26%21-30 hours11-20 hours31 hoursWeekly Broadcast Radio listening is higher among those who also listen to Internet Radio, demonstrating use of InternetWeeklyTime SpentRadio complements Broadcast Radio listening patterns(Figure6). Using Internet10%Source: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks Associates0%The Most Engaged Radio Users are those who also Use Internet RadioFigure 61-10 hours11-20 hours21-30 hours31 hours1-7 hourshoursWeeklyTime Spent8-14UsingInternet15 hoursSource:RADIOTargetSpotInternet ONLYRadio Advertising Impact StudyBROADCASTListeners67% 2011 TargetSpot, Inc. (n 1009)— Research by Parks AssociatesBROADCASTRADIOFigure6 & INTERNET RADIOListeners (n 812)BROADCAST RADIO Listeners ONLY(n 1009)55%1-7 hours0%18%8-14 hours50%67%16%28%17%15 hours18%16%100%Source: TargetSpot Internet Radio Advertising Impact Study 2011TargetSpot,RADIOInc. — Research by Parks AssociatesBROADCAST RADIO& INTERNET55%Listeners (n 812)28%17%Broadcast Radio ad recall and response rates significantly increase when combined with Internet Radio use (Figure 7).0%50%The data reveal a 3.5x difference in ad responsebetween BroadcastRadio only listeners100%and those who listen to bothBroadcast and InternetRadio.aremore likelyto take action on a Broadcast Radio ad if they also listen toFigure7 ConsumersSource:TargetSpotInternet RadioAdvertisingImpact StudyInternet Radio. 2011 TargetSpot, Inc. — Research by Parks Associates100%BROADCAST RADIOListeners ONLYBROADCAST RADIO & INTERNETRADIO ListenersInternet Radio Use increases Ad Recall and Ad Response of Broadcast Radio Advertising75%Figure 750%100%1.2xBROADCASTRADIOListeners ONLY1.2x1.2xBROADCAST RADIO & INTERNETRADIO Listeners3.5x25%75%50%0%Recall1 Ad25%Recall 1 Product/ServiceCategory(Aided)1.2x1.2x1.2xRecall 1 Recall 1 Recall 1 RespondedProduct/BrandsBrandsto AdService(Aided)(Unaided) 3.5xCategory(Unaided)0%Source: TargetSpot Internet Radio Advertising Impact StudyRecall Inc. Recall 2011 TargetSpot,— ResearchAssociates1 by ParksRecall1 Recall 1 1 AdFigure 8ADCAST RADIO Category(Unaided)Brands(Aided)Recall 1 Brands(Unaided)Respondedto Ad14%Source: TargetSpot Internet Radio Advertising Impact Study3.8x3.5x 2011TargetSpot,Inc.RADIO— Research 2011 TargetSpot, Inc. — Research byParksAssociatesBROADCAST& INTERNETListenersby Parks Associates All rights reserved.12%Figure10%816%7
75%White Paper Internet Radio Advertising Impact Study50%1.2x1.2x1.2x3.5x25%The positive impact of Internet Radio listenership on Broadcast Radio’s ad response is significant as well as broad and0% offline actions—well beyond the click (Figure 8). Users who also listen to Internet Radio wereincludes both online andRecall1 Recall1 to Recall1 Recall1 fromRespondedmore than 3x more likely thanRecallBroadcastRadio-onlylistenerstake specificactionan ad, e.g., search for more1 AdProduct/information or go to an advertiser’s ory(Unaided)Brands(Aided)Brands(Unaided)to AdInternet Radio Use Increases Broadcast Radio Ad Responses,Source: TargetSpot Internet Radio Advertising Impact StudyAcross the Board: Online and Offline 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 8% responding to BROADCAST RADIO ad16%14%3.5xBROADCAST & INTERNET RADIO Listeners12%3.8x10%8%6%BROADCAST RADIO Listeners ONLY4%4x2%0%Sentemail/textPurchased Called for Purchasedproduct/ information product/serviceservice atonlineretailBecame a SearchedVisited“fan” onfor more advertiser'sa social information websitenetworking onlinewebsitesSource: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 9restaurantsautomotive2xinsurancefood products2.2xretail stores2.2xfinancial l-airlines, hotels, etc.consumer electronics% of those wholisten to bothBROADCAST RADIOand INTERNET RADIOwho recall the SAMEproduct/servicecategory advertisedon both media% of BROADCASTRADIO onlylisteners who recallan advertised 2011 TargetSpot, Inc. —ResearchbyParksAssociates All rights reserved.3xproduct/servicecategory2.3x8
% responding to BR8%6%White Paper Internet ONLY4%4x2%0%SentPurchasedtextserviceCalled forPurchasedBecame aSearchedVisitedemail/advertisingproduct/ oninformationproduct/onforRadiomore is advertiser'sThe deep synergy of cross-mediaboth InternetRadio and“fan”Broadcastevident in increased adrecall of key product/service categoriesonline(Figure 9).service atretaila social information websitenetworking onlinewebsitesSource: TargetSpot Internet Radio Advertising Impact StudyInternetRadioImpact:AdbyRecallof Broadcast Radio Increases up to 3x 2011TargetSpot,Inc. — ResearchParks AssociatesFigure 9restaurantsautomotive2xinsurancefood products2.2xretail stores2.2xfinancial xtravel-airlines, hotels, etc.% of those wholisten to bothBROADCAST RADIOand INTERNET RADIOwho recall the SAMEproduct/servicecategory advertisedon both media% of BROADCASTRADIO onlylisteners who recallan advertisedproduct/servicecategoryconsumer electronics0%30%60%% that recall ad category on BROADCAST RADIOSource: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesFigure 10% responding to BROADCAST RADIO ad50%40%BROADCAST & INTERNET RADIO Listeners30%20%BROADCAST RADIO Listeners ONLY24%18%10% 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.0% 1 hour1-5 hours6-10 hours11-15 hours15 hours9
listen to bothBROADCAST RADIOretail storesand INTERNET RADIOwho recallWhite Paper Internet Radio Advertising ImpactStudythe SAME2.2xproduct/servicefinancial servicescategory advertisedon both mediaentertainment/media% of BROADCAST2.3xRADIO onlytelecommunicationslisteners who recallThe addition of Internet Radio listening impacts Broadcast ad response rates more anthanany incrementaladvertised3xproduct/servicetime spent listeningtravel-airlines,to e inThis profound synergistic impact is evident even among users listening to Internet Radio for less than one hour perconsumer electronicsweek. The addition of Internet Radio boosts ad response rates by a greater percentage than increasing Broadcast Radiolistening time by 15x or more (Figure 10).0%30%60%% that recall ad category on BROADCAST RADIOAdding Internet Radio Listening Impacts Broadcast Radio Ad ResponseSource: TargetSpot Internet Radio Advertising Impact Studymore Inc.thanIncreasingBroadcast Radio Listening 2011 TargetSpot,— Researchby Parks AssociatesFigure 10% responding to BROADCAST RADIO ad50%40%BROADCAST & INTERNET RADIO Listeners30%20%BROADCAST RADIO Listeners ONLY24%18%10%0% 1 hour1-5 hours6-10 hours11-15 hours15 hoursWeekly Time Spent Using InternetSource: TargetSpot Internet Radio Advertising Impact Study 2011 TargetSpot, Inc. — Research by Parks AssociatesInternet Radio listenership has reached 39% ofU.S. broadband households 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.10
White Paper Internet Radio Advertising Impact StudyCONCLUSIONINTERNET RADIO: AN ESSENTIAL ADDITIVE COMPONENT FOR ONLINE ANDBROADCAST MEDIA BUYSThe findings highlight the synergistic, additive value of including Internet Radio into the Broadcast Radio and digitaladvertising planning and buying process. Internet Radio users, a highly engaged demographic overall1, are also highlyengaged in digital media and Broadcast Radio. Including Internet Radio with either digital media or Broadcast Radio adbuys will dramatically increase campaign ad recall. Moreover, it will increase ad response rates to the campaign, acrossa broad array of actions, online and offline, well beyond the click. The incremental benefit of adding Internet Radio toan Online or Broadcast Radio campaign is shown to have a much greater impact on the campaign Ad Response thanan increased usage of these media.TargetSpot’s research findings offer quantifiable rationale for supplementing existing and future advertising campaignswith Internet Radio. The data demonstrate the value of Internet Radio as a complementary component of Online andBroadcast Radio advertising, offering a compelling case for brands to utilize Internet Radio to engage consumers withmaximum impact.SOURCESTARGETSPOT INTERNET RADIO ADVERTISING IMPACT STUDY, 2011TargetSpot’s Internet Radio Advertising Impact Study is an online survey of broadband households in the UnitedStates (U.S.). The study fielded between January 11- 26, 2011. The sample population included 2,127 U.S. broadbandhouseholds (ages 18 ) who listen to Broadcast Radio and Internet Radio and use the Internet once a month to daily.1Source: TargetSpot Digital Audio Usage Trends: A Highly Engaged Listenership 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.11
White Paper Internet Radio Advertising Impact StudyRESEARCH METHODOLOGYUsing an online survey, TargetSpot tested four independent user groups to quantify and compare ad exposure,awareness, and response. The groups include: Internet users (no Internet Radio) Internet users that listen to Internet Radio Broadcast Radio listeners (no Internet Radio) Broadcast Radio and Internet Radio listenersThe survey measured the following variables:Dependent Variables Ad awareness by product/service category—Unaided & Aided* Brand awareness—Unaided & Aided* Ad response by product/service category Brand purchase by product/service categoryIndependent VariablesDemographics & Psychographics Gender Age Income Ethnicity Marital Status Household composition Place of residence Time spent with advertising medium Attitudes towards advertising* Ad monitoring sources Nielsen AdRelevance, U.S. (for Online advertising)and Media Monitors (for Broadcast Radio advertising) were used to verifyactive brands tested in the study. 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.12
White Paper Internet Radio Advertising Impact StudyABOUT TARGETSPOTTargetSpot is the largest digital audio advertising network. TargetSpot connects top national brands, regional, and localadvertisers to highly engaged internet and mobile audiences. Advertisers work with TargetSpot’s team or use its selfservice platform to create rich media campaigns delivering high-impact audio, display and pre-roll video advertisingacross thousands of online properties. TargetSpot advertisers can target consumers by demographics, listeningpreferences, and geography down to zip code level; while benefitting from real time reporting and analytics. TargetSpothas 80 distribution partners, including CBS RADIO, AOL Radio, Entercom, Live 365, Yahoo! Music, and MySpace Music.TargetSpot is based in New York City. For more information, please visit www.targetspot.com.ABOUT PARKS ASSOCIATESParks Associates is an internationally recognized market research and consulting company specializing in emergingconsumer technology products and services. Founded in 1986, Parks Associates creates research capital for companiesranging from Fortune 500 to small start-ups through market reports, primary studies, consumer research, customresearch, workshops, executive conferences, and annual service subscriptions.The company’s expertise includes new media, digital entertainment and gaming, home networks, Internet andtelevision services, digital health, mobile applications and services, consumer electronics, energy management, andhome control systems and security.Each year, Parks Associates hosts executive conferences CONNECTIONS , with support from the Consumer ElectronicsAssociation (CEA) ; CONNECTIONS Europe; and Smart Energy Summit.parksassociates.com connectionsconference.com connectionseurope.com connectionsindustryinsights.com 2011 TargetSpot, Inc. — Research by Parks Associates All rights reserved.13
Internet Radio advertising is effective both on its own and in combination with Online advertising or with traditional . INTeRNeT RAdIo INCReASeS oNLINe AdVeRTISING effeCTIVeNeSS Weekly Online use is higher among those who also listen to Internet Radio, demonstrating Internet Radio use complements Online usage (Figure 1).
