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FRIDAY, SEPTEMBER 25, 2015

Veritone Takes Measure of Real-Time Audio. The largely unmonitored world of live endorsement ads, product mentions and native advertising is about to become a lot more measurable. Veritone Media on Tuesday will formally launch a cloud-based platform that promises real-time verification, tracking and attribution for advertising and content on broadcast radio and TV, YouTube and podcasts. The tech start-up monitors several thousand hours of audio and video programming per day, pouring the data into its Cognitive Media Platform, which transcribes and analyzes it. Within five minutes of airing, the system spits out a “very rich dataset of almost every single thing that is being spoken about or displayed on that medium, inclusive of every single word that’s mentioned,” says Veritone president Ryan Steelberg. Through transcription and indexing, the monitored audio becomes searchable. “What Google does for websites, we’re doing for audio and video,” Steelberg says. With Americans bombarded by thousands of ads per day, the challenge for advertisers increasingly is determining which ones are working. DraftKings, Dollar Shave Club, Legal Zoom, Uber and other Veritone clients use the technology to verify and identify their own live reads and discussions about their brands—and their competitors. Weekly analytics reports include numbers of mentions, stations, programs, average audience and other metrics. More than another monitoring service that tracks ad clearances and measures attribution, the new technology is used by advertisers to track the sentiment being expressed about their brands in so-called earned media. “Using it to listen to the conversation and sentiment about their brands is very important for DraftKings, so they have great visibility in near real time about what is being said about their brand and when, down to the exact second in each market,” Steelberg says. Brothers, Keepers—Veritone founders Ryan and Chad Steelberg have taken a fascinating tech path through radio; read about it at InsideRadio.com.

Veritone Tech Puts Audio In Search 2.0 World. Hitting the scan button has for decades been the primary tool for searching for radio content. New technology may bring a more efficient way for listeners to find what they’re looking for. Westwood One, Greater Media and Howard Stern are among dozens of broadcasters that have licensed Veritione Media technology to digitize, index and repackage their audio content into clip collections that can be distributed across digital and social media platforms. Broadcasters are also using the technology for sentiment extraction, search and discovery of trending topics, ad verification and competitive analysis. Veritone’s Cognitive Media Platform makes audio content searchable on digital devices, which could expand the way audio is discovered and consumed. “Search is the primary method of discovery,” Veritone president Ryan Steelberg says. “Radio is primarily limited to long-form consumption but that’s not how consumers at scale today are finding and consuming content.” Digitizing and indexing audio in near real time could take radio from the scan button to the search bar. “If I search for ‘UCLA football’ on Google, what never shows up in that index is that Mike and Mike on 710 ESPN Radio were just talking about that,” Steelberg says. In a searchable audio world, the search results would include a copyright-compliant audio clip in short form and a link to the station or network’s digital property to hear the entire clip. Stations would monetize the content with targeted advertising—both in the search results and when the listeners click through to hear the full audio clip. Says Steelberg, “When you index the audio and video and do a search, I can now get access to that conversation that was just being discussed by Jim Rome or Mike and Mike.”

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FRIDAY, SEPTEMBER 25, 2015NEWS

Why Radio and Retail Are Each Other’s Secret Santa. As retailers gear up for the holiday shopping season, consumer spending is forecast to be strong, and American shoppers are expected to rely more heavily on digital sources for information and deals. That’s all good news for radio broadcasters eager to get a piece of retailers’ holiday ad budgets for their on-air and digital assets. A new report from Deloitte’s Retail and Distribution division predicts holiday retail sales will reach between $961 billion and $965 billion, up 3.5%-4% over 2014 holiday spending, excluding car and gasoline sales. More than ever, digital will influence shoppers’ purchases, with 80% of consumers saying they engage with a store or brand before ever going inside the physical retail outlet. That connection creates opportunities for radio stations to partner with brands to activate consumers both on-air and online, including digital campaigns, exclusive discounts or offers and DJ mentions on-air and on social media. Since radio is often the last media that consumers touch before getting to the point of purchase, radio stations are a natural partner for retailers and even more so during the holiday shopping season. Digital will play a strong role in both purchases and research, Deloitte forecasts, with an 8.5%-9% increase in non-store sales, which includes online and mail-order transactions, and digital interactions will influence 64%, or $434 million, of retail store sales. “Online sales continue to be a growth channel, but more importantly, we’ve passed the tipping point where online and mobile engagement play a greater role generating sales in the physical store—where more than 90% of retail sales occur—than in digital channels alone,” Rod Sides, vice chairman, Deloitte LLP and Retail and Distribution sector leader, said in a statement.

‘Empire’ Building Includes Strong Radio Play. If (recent) past is prologue, then “Empire,” Fox’s huge TV hit that had its season-2 debut this week, has a chance to once again make cross-platform ratings noise in both TV and music. And that’s where radio comes in, confirms programming consultant Tony Gray. “Like ‘American Idol’ in its early years, ‘Empire’ has had a tremendous impact on pop culture, urban radio and the music business,” Gray tells Inside Radio. For radio and the music industry, Nielsen points to the show’s soundtrack sales of more than 431,000 copies. The album debuted at No. 1 on the Billboard 200 and remained on the chart for 19 weeks, and it has been streamed fully or in part 122 million times. In addition, “Conqueror,” by Jussie Smollett featuring Estelle, became its top song by sales and airplay, selling 235,000 copies and fostering 12,000 spins on radio, according to Nielsen. “What is Love,” by V. Bozeman, has also been streamed more than 21 million times. Radio’s part of the successful “Empire” equation is considerable. The team behind the primetime soap opera about a music mogul and his dysfunctional family is hyper-aware of branding with the music industry. For example, as a tie-in between seasons 1 and 2, last July, Fox launched the Fox’s Next Empire Artist bus tour, which Adweek reports visited 15 cities and offered fans the chance to record a cappella versions of the show’s songs and win a chance to appear as an artist on the show. Cast members Smollett and Bryshere “Yazz” Gray also performed on the August Teen Choice Awards. Hip-Hop Hooray—Read Nielsen’s demographic breakdown of “Empire” at InsideRadio.com.

CBS Radio In The Eye of the Camera. So much for the old expression, “You have a face for radio.” As the desire for video content is ever increasing for on-air broadcasters, CBS Radio News anchors, for one, are now dealing with a barrage of cameras in the studio. A story in USA Today outlines how live radio content is now available for video streaming, alongside pausing and replaying. In other words, smiles, everybody! The bemusing piece begins: “You hear the tone at the top of the hour. The musical signature plays. The correspondent announces, ‘CBS News. I’m Frank Settipani.’ The voice, ubiquitous through clock, bathroom and car radios, has been unseen for decades. Not anymore.” With cameras now capturing the reading of the news, on-air content is freely available on the Internet, where “you’ll see a thin man in Sony headphones and a long-sleeve shirt speak into a bulbous microphone inches from his glasses.” USA Today notes that “listeners” can now “watch” CBS Radio News on multiple devices—a smartphone, tablet, computer or on TV through a media receiver such as Roku or Apple TV. Harvey Nagler, VP of CBS Radio News, tells USA Today, “It’s not that they’re being spied upon. They were a bit hesitant because clearly this was a change in routine. But over time, they’re pretty comfortable, particularly since they get a nice response from people who watch CBSN. These anchors are extraordinary professionals. They’ve been doing it for years, so I don’t think they’re fazed by having cameras in the studio, and I suspect they sort of enjoy it.”

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FRIDAY, SEPTEMBER 25, 2015NEWS

Ad Insider: T-Mobile and Sprint In Price War. That loud tone you hear? It’s the continuation of the cellphone pricing wars. First, T-Mobile announced a new deal which offered a 16-gigabyte iPhone 6s for monthly payments of $5-$10 (depending on the value of the traded-in phone). In less than a day, in a statement titled, “Not So Fast, T-Mobile,” Sprint countered with a change in its iPhone Forever plan that works out to a $1 a month lease. The Wall Street Journal says T-Mobile “has been snatching away market share by aggressively slashing its prices” and passed Sprint in total connections during August….While we’ve been keeping an eye on the UAW talks with the Detroit 3, Hyundai and Kia dealers are watching what’s happening in Korea, where workers have walked out at all three plants there. The Wall Street Journal says a major strike this year could be damaging to the company as it is counting on new models to revive sales in its major markets, including the U.S….Automotive News reports that even though the current version of the Altima is considered to be a success for Nissan, the company is updating the car a year early with new design and safety-systems elements. Altima is up 1.3% in sales so far this year, outperforming the midsize car segment, which is down 3.2%. The new model reaches dealers in mid-November….It’s no surprise that selling money is big business. Rent-To-Own chain Aaron’s owns a consumer finance unit called Progressive Financial, which services its own and other stores, and Progressive is now introducing two new products. It acquired Dent-A-Med, which specializes in “near-prime” customers and is launching Approve Me, a system that integrates with retailers’ own systems to secure credit approval in a faster and efficient manner. In the Zone—AutoZone’s radio-to-revenue ratio rocked in the first half of this year. Check it out at InsideRadio.com.

Hillary—No Tax Breaks for Drug Ads. If Hillary Clinton makes it to the Oval Office, pervasive ads for prescription drugs will no longer garner major tax breaks. As part of her “war on high prescription prices,” the Democratic hopeful rolled out her plan at a campaign stop in Des Moines, Iowa. The plan would, in part, strip pharmaceutical companies of their ability to deduct direct-to-consumer advertising costs, according to a story in Advertising Age. The aim is to rein in unnecessary drug spending because there would be fewer ads prompting patients to press doctors to prescribe meds they learned about via media advertising. In the Iowa stop, Clinton explained that drug companies keep profits while “shifting the cost to families.” Not surprisingly, the advertising community was not amused. AdAge reports that both the Pharmaceutical Research and Manufacturers of America and the Association of National Advertisers are already pushing back. ANA lobbyist Dan Jaffe called her proposition unconstitutional and misguided, adding, “These proposals would penalize prescription drug products, however truthful, non-deceptive and potentially life-saving they might be. We believe consumers should have more information about their health, not less.” Last year, pharmaceuticals spent $3.2 billion on TV ads and $1.2 billion on magazine ads, a category that also attracts a fair amount of radio ad dollars.

Digital Ad Blocking Could Benefit Radio. While the growth of digital ad-blocking technology is vexing online advertisers—and the dot-coms selling the ads—broadcast radio stations could actually benefit, according to one radio industry leader. And while streaming audio providers are at risk for users blocking their ads on desktops and undercutting their business model, the threat is much greater for display advertising. “Radio has adapted to this and is light years ahead of our friends in digital, especially because of our typical live and local formats,” Paul Rotella, president and CEO of the New Jersey Broadcasters Association, said in a newsletter to association members. Rotella adds that live radio doesn’t face the same obstacles to its messages being heard—“You can’t block a live read!” he says. Ad-blocking software can eliminate digital and mobile display ads, and is causing concern among advertisers and digital publishers. But a new report from UBS urges caution, saying it doesn’t expect ad blocking to be mainstream, adding that the impact on digital advertising will be minimal. Ad blocking on Apple devices, including iPhones and iPads, could cost digital publishers more than $1 billion in lost digital ad revenue, according UBS. While those losses sound high, it represents only 0.5% of global digital ad expenditures and 1.3% of mobile ad spend, UBS says. Apple’s new iOS 9 operating system offers new ad blocker apps, but iOS 9-enabled devices are currently a fraction of Apple devices in the marketplace. And that ad-blocking software only works during Web browsing on Apple’s Safari browser, not in apps. Mobile users spend the majority of their time with apps, and in-app advertising is the bulk of mobile ad spending, according to UBS.

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Apple Offers Ad-Supported Service? (Ssshhh) Think Apple isn’t in the ad-supported streaming audio business? Think again. A new report from ad service provider Xappmedia debunks the myth that the nearly three-month-old Apple Music service doesn’t offer a freemium service, like its pureplay rivals. “The promotion of Apple Music avoided any mention of advertising and focused solely on the new subscription service,” Xappmedia says in the report. “Based on this focus, the conjecture of many observers was that Apple was abandoning the ad-supported model it had cultivated for nearly two years with iTunes Radio. The data shows that Apple continued with ad-supported listening even after the launch of the Apple Music subscription service and actually increased its historical quarterly ad load.” The new ad analysis uncovered a striking difference between Apple and its ad-supported streaming audio peers. Just about half of advertisers identified were recording artists promoting album downloads on iTunes. Apple’s retention of the ad-supported service that began with iTunes Radio is no surprise in light of recent research from Nielsen showing 95% of consumers have chosen ad-supported listening over subscription for streaming services. “There is little doubt that Apple would like the opportunity to capture the attention of the 95% in addition to the subscription dollars of the 5%,” the report states. By Xappmedia’s calculations, next week about half of the 15 million trial subscribers to Apple Music will either be charged $9.99 for their first monthly payment—or start hearing ads again.

Report—Ad-Supported Audio Streams Cash. Among significant news bites from Wednesday’s RIAA (flat) music sales report for the first half of 2015 are statistics showing that ad-supported audio streaming is a larger revenue business than that of paid subscriptions. This comes according to Kurt Hanson’s RAIN News, which offers an overall purview of the numbers. According to the RAIN News report, the data reveals “a stark and definitive picture of how the market is crossing over from an old product paradigm (CDs) to a new one (streaming) over three years.” The RIAA breaks down streaming revenues into three categories—subscription revenue (including paid monthly memberships in Rhapsody, Spotify and other interactive music library platforms); SoundExchange distributions (revenue from such non-interactive Internet radio services as Pandora); and on-demand ad-supported streaming (non-subscription listening plans monetized by advertising, including Spotify). RAIN reporter Brad Hill breaks it down further, saying, “A great deal of media swirl is focused on the growth of music subscriptions. Lost in that swirl is a key fact of the streaming audio industry: Ad-supported listening is big business. A close look at RIAA figures for the past three years shows that ad-supported streaming is a bigger revenue business than subscriptions streaming.” The RAIN story also refers to Pandora CEO Brian McAndrews, acknowledging that the company’s ad-based model is superseding subscriptions. In an OpEd in Billboard, McAndrews said, “Just because a service doesn’t require a subscription fee doesn’t mean the music is free,” adding that Pandora has paid more than $1.5 billion to rights-holders, with 80% coming from advertising revenue.

Look Who’s Hawking—AmEx’s Free Radios for Seattle Fans. As part of a new multi-year partnership with the Seattle Seahawks, American Express is providing cardholders with a number of offers, experiences and benefits “designed to magnify the excitement around the season,” according to the company. In addition to pregame parties at Occidental Park, meet-and-greets with former players, autographed Hawks gear and other swag, AmEx will give away Gridiron radios throughout the football season. The play-by-play radios to be distributed at CenturyLink Field at all scheduled home games, will allow fans to hear the Seahawks broadcasts from Bonneville’s “710 ESPN” KIRO and news/talk KIRO-FM (97.3). In a release, American Express said, “Knowing that fans want to be as close to the on-the-field action as possible, card members will be able to hear live play-by-play commentary and game updates from Seahawks radio broadcasts while watching the action in-stadium with the American Express Gridiron Radio earpieces.” Added American Express’ president, Global Merchant Services, Anré Williams, “The 12s [a nickname referring to loud Seahawks fans being the “12th man” on the field] are some of the most passionate and loudest football fans in the country. We have a unique opportunity to embrace that fandom and create exciting, new ways for card members and Hawk fans to cheer on their favorite team throughout the 2015 season.” Earlier this month, American Express conjured a similar promotion for the U.S. Open in New York City, when it handed out 12,000 radios to attendees as they entered the gates. That giveaway, “American Express Radio Live at the Open,” also provided the radio earpieces so that fans could listen to live play-by-play commentary from ESPN.

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FRIDAY, SEPTEMBER 25, 2015NEWS

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FRIDAY, SEPTEMBER 25, 2015On the Insidewith...

Check out other recent Insider Interviews >> Gordon Smith | Peter Smyth | Pierre Bourvard | Paul Brenner | Rod Phillips | Anthony Bay | Lary Wilson | Kristin Kolodge | Bill Hendrich | J. Pat Miller | GE Capital’s Ray Shu | Ramsey’s Chris Brown | E. W. Scripps Company

On The Inside With Kevin Gallagher

Radio Show attendees who opt for next Wednesday’s “Agencies Speak!” session are guaranteed a tour around a popular topic—ad agencies’ perspective of the media landscape and ways to leverage radio and other platforms to meet client objectives. That will give them the perspective of Kevin Gallagher, executive VP local marketplaces for Starcom. Gallagher, a big part of Starcom’s success, has worked with Allstate, Kellogg, Pillsbury, Miller Brewing, Disney Studios and General Motors in his media planning and buying career. The recipient of Starcom’s Northstar Award for innovative media ideas, Gallagher has also served as chairman of the Local TV and Radio Committee of the American Association of Advertising Agencies. He talks to Inside Radio about how radio needs to change it’s selling ways, why programmatic is essential and what he sees as broadcast radio’s advantages over its competitors.

IR: Radio has long been thought of as a low cost-frequency medium. Now that it has surpassed TV as the America’s No. 1 reach medium, are perceptions of the medium changing?On the planning and buying side, and on the marketer side, we’ve always known that radio reaches a lot of people. There are always marketers that will value reach. I don’t know that increase alone or increase in reach changes the perception of the medium. What marketers and ad agencies are looking for is precision and better targeting. There are always people out there that want broad reach and we know that radio does that. [But] it’s a tricky thing to sell reach. There are a lot of positives. There is just a balance between reach being the priority vs. more precise targeting.

IR: Why is it important for radio to embrace programmatic ad sales?Programmatic is the big buzzword, and there is an automation component, and a data and targeting component to it. In radio, there is definitely an automation piece and the ability to use data to better target. It would help radio play in the digital ad dollar space. Clients want to target better. Automation helps everybody, because it speeds the process, it creates less human error and it allows transactions to happen faster. [And] you have to bring some data to the process. We’ve trained clients that there are ways to use data to be more precise with who they are targeting. Clients believe that, they see it happen, and they can prove out ROI in the digital space. We need to do local TV and local radio better than we currently do it. Using a combination of automation and data would put radio on more of a level playing field. If we can do it smarter, if we can go to clients and say: “We can target better, we can spend more money more efficiently via a programmatic process,” then clients are going to listen to that.

IR: What does radio bring to the table that other media cannot? A few things: One is local content. Radio really owns that local space when you compare it to TV. Even at a local TV station, there’s very few programming hours that are purely local and when there are, they are news. Also personality and DJ endorsements, which has always been a strength of radio, and how brands can tie with the listeners’ affinity for that particular personality. And radio offers flexibility, the ability to get on-air quickly and do live reads. We don’t have to take a lot of time to produce ads. We talk a lot about real-time marketing and clients wanting to do things in real time, and I think radio has always been real time.

IR: What are your suggestions for radio sellers? How can they do a better job of serving you and your clients?I would encourage selling cross-platform and cross-assets, whether that is the broadcast station itself, the website or getting the content of the DJs out into the marketplace. At agencies, we talk a lot about creating brand experiences and being part of consumers’ lives. I think that radio can play in that space. People have affinity either to a particular type of music or a particular DJ, and radio stations do things that are on-site activations. Whether it is concerts, sports venues and store grand openings, there are lots of things radio stations can do to be part of people’s lives and part of brand activation, more than just selling spots. It is about how all those things work together to solve a brand problem.

Automation Nation — Gallagher tackles the question of how programmatic will transform how radio is used by clients, only at InsideRadio.com.

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