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Insideradio.Com 800.275.2840 MORE NEWS» insideradio.com THE MOST TRUSTED NEWS IN RADIO WEDNESDAY, MARCH 4, 2015 Local advertising is going native: Havas CEO. With a major restaurant chain such as McDonald’s part of Havas Media’s roster, CEO Lori Hiltz says traditional local advertising buys remain a big part of what her media shop focuses on each day. But she said the nuances of the local market also have more clients moving toward native advertising, where brand messages can be seamlessly woven into content. It’s one reason why her agency has built a full studio inside its New York headquarters. She thinks local radio, TV and print also need to go native, so to speak, to remain relevant. “What you are selling is the cumulative local audience, and if you don’t have the content or don’t have the ability to do that in real time, you’re at a disadvantage,” she said. Speaking at the Borrell Local Online Advertising Conference yesterday, Hiltz praised CBS’ Altitude Group as a sales team that’s in step with how marketers are thinking in 2015. “These guys came in and said they were going to do ideas based upon local market insights and the dimensionalization of the audience — nothing to do with call letters or dayparts, they came in with an idea that matched the marketer,” she said. “Without that, I’m just buying spots and dots — those days are far over.” CBS Local Digital Media president Ezra Kucharz said the company sees native ads as a way to move beyond the “yell and sell” offered to clients and help local media outshine its digital-only rivals. “They have a call center. We’re in those markets,” he said. “We have the ability to reach out to our partners.” By staying close and local, Cox accelerates digital revenue growth. Privately-held Cox Media Group had $1.6 billion dollars in revenue last year across its many outlets, including 57 radio stations. Digital revenue now totals roughly $200 million as sales increased 16% or more in each of the past three years. But EVP of strategy and digital Neil Johnston says the real exciting number has come over just the past three months. “That is a trend we have seen accelerating as we have moved into 2015,” he said Tuesday at the Borrell Local Online Advertising Conference. Cox has seen digital revenue grow at nearly twice its previous rate during the past three months, climbing 31% during December, January and February. Even with big websites like AutoTrader in its portfolio, Johnston said Cox is thinking small to stand out in an increasingly crowded digital marketplace. “We’ve invested in local market sales because we think if you’re closer to the customer and have expertise in the local market, it’s a differentiator,” he said. The biggest challenge hasn’t been someone in a market offering something unique. Instead, Johnston points to keeping the digital sales process simple and not getting distracted by the proverbial shiny new objects. That includes using what he calls a “linkage” strategy to appeal to local clients that are being more sophisticated buyers. “Combining traditional media with digital has really been the thing which allowed our salespeople to build very unique relationships with customers,” Johnston said. “Advertisers are no longer just looking at TV, radio or newspapers. What’s much more important to them is for salespeople to come into them and to be able to offer a complete product set and complete market solution.” Programmatic could ‘blur’ national-local lines, analyst says. Much of radio’s focus NEWS INSIDE >> on the impending arrival and expansion of programmatic buying has been on a potential impact on the price paid by advertisers. But a bigger effect could be how it will break JUDGE CLEARS THE down marketers’ walls. “There is a significant potential for a blurring between national TRAIL FOR ‘BIG BOY’ TO and local inventory in a way that doesn’t really exist right now,” Pivotal Research analyst CROSS THE STREET [email protected] | 800.275.2840 PG 1 NEWS insideradio.com WEDNESDAY, MARCH 4, 2015 Brian Wieser said. Machine-to-machine buying will allow for an advertiser to buy across markets and stations, or hone-in on a single city with just a few different keystrokes. “Your automated processes don’t really care exactly how you get the inventory,” Wieser said. “This potentially creates a broadcaster marketplace, especially for local media.” He puts at the top of the list a group of newbie marketers that grew up on digital advertising. But as they’ve grown bigger, other forms of media could make sense for them. Most critically, Wieser told the Borrell Local Advertising Conference, is that it upends the goal long associated with the traditional reach and frequency mindset. “It’s not about selling to the right customer, it’s about what inventory goes to which advertiser,” he said. Under orders from their holding companies, big agency media teams are racing to embrace programmatic buying. OMD, for instance, has said it hopes to place the bulk of its national radio buys that way by the end of next year. Weiser said it’s not surprising to see agencies champion the conversion, and not just because they think they’re getting more value from the buy. “Having a data-driven sale ultimately makes the agency look like a hero to the clients,” he said. ComScore: Radio remains the ultimate in mobile media. Since portable radios arrived on the scene decades ago, radio has long been the on-the-go electronic medium. Now that smartphones have become ubiquitous, new comScore data shows no other content category gets more of its digital consumption on a mobile device. The research firm says 99% of time spent with radio’s digital extensions is done on a smartphone or tablet. Just 1% is on desktops. It’s an even bigger time spent tilt that than what comScore tracks for photographs (96% mobile), maps (90%), weather (82%), news (51%), or sports (47%). Growing penetration is helping drive the growth. There are currently 182 million smartphones in use, reaching three-quarters of the market. Penetration up 18 points in the last year, according to comScore. Tablets now total 97 million with a 40% market penetration. Even so, comScore co-founder and executive chairman Gian Fulgoni said at the Borrell Local Advertising Conference that the desktop is hardly dead. It accounted for 41% of the 1.3 billion online minutes logged by Americans in November. And in terms of total minutes, desktop use rose 19% compared to a year earlier. “You can’t afford to not have a mobile strategy, but you still have to pay attention to desktop because people are still using it for a variety of activities,” Fulgoni said. Yet comScore says 56% of online time is now spent with mobile apps. But the data also reveals75% of app time goes to just four apps. “Once you have that app on the phone, you have the challenge of whether it’s going to be used,” Fulgoni said. Experts say that’s where radio’s content advantage should come into play. Kucharz: The digital revolution is far from over. First the web was used as a directory, then search was all the rage. CBS Local Digital Media president Ezra Kucharz predicts big data is the next mountain for local media to climb. So-called artificial intelligence is already being used to help organize the reams of data now available to marketers into something that’s actually useful. “This is going to make what we live in, both broadcast and digital, completely different than what it is today,” he said. “This industry is going to look completely different in five years because of all the data that is readily available to broadcasters, publishers and marketers.” He told the Borrell Local Online Advertising Conference that big data is only one piece of the equation. For local content creators like radio stations, delivering the right content to people, whenever they want it, will increasingly mean that screens and storytelling trump the traditional notion of radio, TV or digital. “Broadcast is strong and will remain strong — radio and television will always be there,” he said. “But you have to take that content and put it across all these different platforms.” Some digital pros say the irony is technology has also allowed radio to swim upstream from digital’s renewed focus on hyper-local. “I started in radio in 1985 and radio today is actually less hyper-local than it was then,” said Rob Weisbord, VP of digital for Sinclair Broadcast Group, which owns four Seattle radio stations. Cumulus land sales to help cut company debt. A pair of real estate sales are expected to fetch in the neighborhood of $200 million for Cumulus Media, which the company says it will use to meet a commitment to pay down $600 million of debt by the end of 2016. The second of two sales involves a 75-acre property in Bethesda, MD, home to the tower site for news/talk WMAL (105.9, 630). The company told analysts on Monday it has received interest from more than 100 parties, including a preemptive bid, and that it expects to close on the deal towards the end of the year. That’s right around the same [email protected] | 800.275.2840 PG 2 NEWS insideradio.com WEDNESDAY, MARCH 4, 2015 time it expects to cinch-up a long delayed deal to unload a 10-acre site where classic rock KLOS (95.5) and “Talk Radio 790” KABC have long been situated.
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