Katz Radio Group

June 29, 2015

RADIO: THEY ARE LISTENING

CONTENTS

Radio in the Media Landscape Radio is America’s Companion Radio vs. Music Streaming Services Radio’s Unique Capabilities Radio’s Power to Amplify Radio: Advertising that Works

1950 TodayUp 1,100,000

listeners in the past year in the

US alone!

Radio reaches 245,000,000 US consumers per week who spend 2-2/3 hours/day listening

Source: June 2015 RADAR® 125 and June 2015 RADAR® 121 Mon- Sun 12A-12A. Persons 12+

RADIO CONTINUES TO BE A “BIG THREE” MASS MEDIUM

CAMPAIGN CONUNDRUM:

• Consumers are receiving information from more sources than ever. How will you reach them?

• 900+ TV networks available anywhere anyplace means ratings are spread out over hundreds of channels and programs

• The majority of homes use a DVR to time-shift primetime programming

• iTunes alone now features over 1 million apps

• Internet is home to over 3 billion web properties.

Radio is

EverywhereHome / In-Dash / Digital / Internet / Streaming / Mobile / Wi-Fi / Tablet

Radio offers unique, compelling content and connection - no matter how or where listeners go to find it

NEARLY EVERYONE USES RADIO. IN REAL TIME. EVERY WEEK.

P 12+ P 18-34 P 25-54 P 35-64 Hisp18-49

AA/Blk18-49

W 25-54 P 18-49HH $75K+

P 18-34Col Ed

M 25-54Emp.

91% 91% 93% 94% 94% 92% 94% 93% 93% 94%

Weekly Radio Usage

Radio reaches 9 out of 10 people in virtually every segment of the population. That has been true year after year and remains true today.Listeners12+ spend more than 2-1/2 hours a day with radio.

Source: June 2015 RADAR® 124 Mon- Sun 24 hour cume and P12+ avg daily TSL

66%Agree that

their favorite radio stations

reflect who they are as a

person*

80%Have called

into a station, met a DJ in

their community, or interacted in some other

manner

70%Consider radio personalities to

be regular people like

themselves, who are “relatable”

and “authentic” and would truly

miss them if they were gone

60%Think radio

hosts are “like a friend,”

whose opinions they

trust and value

Sources: Woodley, P. Parasocial Interaction between On‐air Radio Personalities and Listeners. USC, Annenberg School for Communication & Journalism, released April 14, 2014; *Latitude Research and OpenMind Strategy. State of Listening in America. May 2013

This relationship carries over to advertisers who become a part of these “Virtual Neighborhoods”.

RADIO HAS THE POWER OF PERSONAL CONNECTION

82%Feel they have

a personal relationship

with their favorite DJ

67%

Agreed “If you couldn’t listen to radio, you’d feel something important was missing from your life.”

Radio connects with people

Source: Latitude Research and OpenMind Strategy. State of Listening in America. May 2013

PEOPLE ARE MORE CONNECTED TO THEIR FAVORITE RADIO STATION THAN TO FACEBOOK

Total <18 18-34 35-54 55+

62% 60% 62% 63%60%

45%

53% 54%

45%

34%

My favorite radio station went away Facebook went away

Read: I would be very disappointed if…

Source: Alan Burns/Triton Digital “The Future of Radio” September 2012 National Consumer Database; 25,000,000 Panelists; August & September 2012;All Ages, Genders and Format Fans; Total Polled = 41,252; Roughly in Line with 2010 Census;

Radio can reach mass audiences AND target effectively

RADIO IS A DOMINANT MEDIUM FOR YOUNG ADULTS 18-34

Radio Internet Broadcast TV Cable TV Mobile Internet0%

100%

Source: Scarborough USA+ 2014 Release 2 Total (Aug 2013 – Sep 2014) Persons 18-34

Used the medium within the last 7 days

Radio Internet Broadcast TV Cable TV Mobile Internet0%

100%

RADIO IS THE #1 CHOICE FOR REACHING ADULTS 25-54

Used the medium within the last 7 days

Source: Scarborough USA+ 2014 Release 2 Total (Aug 2013 – Sep 2014) Persons 25-54

108

109

113

106

114

110

117

$150+ Wireless Bills Last month

Heavy Grocery ShoppersHHLD spent $200+ in past week

Employed Full Time

Luxury Vehicles HH plans to buy/lease in next 12 months

Frequent Fast Food Consumers10+ times in past 30 days

$100K+ Household Income

Upscale HotelsStayed in the past 12 months

HEAVY RADIO LISTENERS ARE PRIME CONSUMER TARGETS

Index:

Source: Scarborough USA+ 2014 Release 2 Total (Aug 2013 – Sep 2014). Adult 18+ Heavy Radio Users (Top 2 Quintiles)

TargetM21-34

20%Outside Target Demo

80%

TargetW18-49

31%Outside Target Demo

69%

Primary Demos% of Users

Source: 2014 Doublebase GfK MRI. %’s are based on Adults 18+ (except for beer, A21+)

Radio reaches the entire brand user group

RADIO REACHES CONSUMERS BEYOND YOUR TARGET DEMO

Grocery Shopping

Retail ShoppingBeer

Quick Service Restaurants

TargetA18-34

31%Outside Target Demo

69%

TargetW25-54

28%Outside Target Demo

72%

The power of radio broadcasting allows you to reach all your customers

Douglas RushkoffNoted author (“Present Shock,” “Wired”), futurist, corporate advisor June 2014 New York State Broadcasters Assn. Conference

If you continue down the road of narrowing the target by eliminating people who do not match exactly your criteria, you will eventually eliminate your business.

RADIO IS VERY DIFFERENT FROM MUSIC COLLECTIONS

“Radio is my community”

• Connections to personalities, on air and online with two-way communication

• A place to belong to, identify with… a VIRTUAL NEIGHBORHOOD

• Local information -- entertainment, news, traffic, weather, opinions, sports, events, opportunities

• Community support and involvement

• Instant information about disasters or other critical community news

BROADCAST RADIO’S ROLE IS UNIQUE

“Radio is my community”

Consumers look for different things from Radio that Music Streaming Services cannot match

BROADCAST RADIO DOMINATES THE A18-34 AUDIO UNIVERSE

Music Streaming Service19%

94% or more of all 18-34, 18-49 and 25-54 Pandora users listen to AM/FM radio weekly

Source: 2014.1 USA TouchPoints. Share of Daily Time Spent Listening for Adults 18-34. Note: AM/FM Radio includes HD Radio and Radio Station Streaming; Scarborough USA+ 2014 Release 2 Total (Aug 2013 - Sep 2014)) Persons 18-34, 18-49,

18-54 who used Pandora (website or app) in the past 30 days

AM/FM Radio81%Daily Time Spent Listening

202M217M

35M

86M

22M31M

BROADCAST RADIO CONTINUES TO DOMINATE EVEN AS THE DIGITAL LANDSCAPE GROWS

Internet Radio 51 million new listeners

Radio15 million new listeners

Satellite Radio9 million new listeners

2010

Note: Streaming Audio includes AM/FM Radio Station Streaming midSource: Scarborough 2010-2014 Release 2. Weekly Users of Broadcast and Satellite Radio, and Monthly Users of Streaming Audio 18+

Today

BroadcastRadio

StreamingAudio

SatelliteRadio

BroadcastRadio

StreamingAudio

SatelliteRadio

Adults 18+

164B

1.1B 151M

55%

-12% -12%

Music Units Consumed Y/Y Growth

SALES OF PHYSICAL OR DIGITAL MUSIC CONTINUE TO DECLINE AS STREAMING GROWS

USA Music Consumption, 2014

Physical Album Sales

Digital Track SalesMusic Streams

Consumers are listening to less of their personal music collections, not less Radio.

Source: 2014 Nielsen Music U.S. Report. Note: Absolute consumption comparisons are apples-to-oranges as the digital tracks/physical album sales are likely played multiple times, but the data is illustrative as grown rate is key indicator

RADIO DIGITAL OFFERINGS CONTINUE TO GROW

Technology has allowed Radio to touch listeners across devices and platforms

• Personalities in just the top 25 markets have more than 47 million Facebook friends and 60 million Twitter followers

• More than 7,200 streaming Radio stations in 2013

• More than 20 million HD radios now in use (20+ million in automobiles)

• Databases and outbound texting ability remain a source for targeted marketing by advertisers

• FM chips embedded in various mobile devices allow data-free listening

Sources: Inside Radio / M Street Corp., 2014 - No Canadian or Mexican stations are included ; HD Radio stat from iBiquity – Inside Radio 9-5-13; RadioWorld.com “Automakers Speed HD Adoption” 2/13/2014; KMS Radio personality Facebook and Twitter accounts research October 2014

RADIO IS THE ORIGINAL SOCIAL NETWORK FOR CONNECTING WITH CONSUMERS 18-34

On a typical day for people 18-34:

• 160% more will use Radio than will go to all Google Sites

• 160% more will use Radio than will go to Facebook

• 190% more will use Radio than will go to YouTube

• 1000% more will use Radio than will go to Twitter

55

21 21 19

5

Radio TwitterFacebook YouTubeGoogle Sites

Adults 18-34 in Millions

Sources: Source: comScore Inc Ratings for March 2015 Average Daily Visitors, Multiplatform 18-34, factored from PC composition; RADAR 125 June 2015, P18-34, M-M plus KDR digital from comScore

Mass Media with the Community TouchWhether it’s on-air personal endorsements, community events, sampling or local sponsorships… no other medium gets your brand closer to consumers in their own neighborhoods.

Local RadioConsumers

Personal Endorsements

Community Event Sponsorships

Experiential Brand Events

Product Sampling

PEOPLE HEAR COMMERCIALS ON RADIO

TUNE-IN IS HIGH DURING COMMERCIAL BREAKS ACROSS AGES AND GENDER

6+ 12-17 18-34 25-54 35-64 65+ Male Female

93% 90% 89% 92% 93%98%

93% 92%

Radio’s Audience Delivery During an Average Minute of Commercial Breaks by Age/Gender

Source: Arbitron, Media Monitors and Coleman analyzed 17.9 million radio commercial breaks from October 2010 to September 2011 across the aggregate markets measured by PPM and Media Monitors, comparing the audience level for each minute of a commercial break to the audience for the minute before the commercials began.

THE POWER OF WHEN – RADIO TOPS ALL OTHER MEDIA IN USAGE OUTSIDE OF THE HOME

Closest to where it matters… Consumers spending their money shopping, going to the movies, finding a restaurant, looking for something to do, etc.

Note: Radio includes radio station streaming, Internet excludes email, Television includes live and time-shifted, but excludes Spanish language channelsSource: 2014.1 USA TouchPoints. Percent of daily usage occurring out of home for Adults 18-54, M-Su 12a-12a.

Radio

Mob

ile In

tern

et

Inte

rnet

via

Compu

ter

Broad

cast

TV

Cable

TV0%

40%

80% (Adults 18-54 / 12A-12A)

Other

All Audio Streaming

Satellite

Radio

2%

6%

8%

84%

RADIO TOPS ALL OTHER IN-CAR AUDIO OPTIONS

(% total listening hours by platform in the car)

Even in connected cars

Source: Audio Demand Landscape (2014); Custom primary research, not Nielsen measured data sources; TCG Analysis Audio Demand Framework

Radio Outdoor Television Newspapers Internet Magazines0%

25%

50%

% of consumers using an advertising supported medium one half-hour before shopping

48% OF PURCHASE DECISIONS OCCUR WITHIN 30 MINUTES OF THE PURCHASE

Source: Arbitron Inc. and Edison Research. The Infinite Dial 2013; POPAI 2014

Radio engages more consumers in that period than any other medium

6:00

AM

7:00

AM

8:00

AM

9:00

AM

10:0

0 AM

11:0

0 AM

12:0

0 PM

1:00

PM

2:00

PM

3:00

PM

4:00

PM

5:00

PM

6:00

PM

7:00

PM

8:00

PM

9:00

PM

10:0

0 PM

11:0

0 PM

0%

5%

10%

15%

20%

25%

30%

35%

40% % Reach of OOH Media by HourNET Mon-Sun / Women 25-54

Shopping AM/FM Radio Internet via Computer

AM/FM Radio

Mobile Internet

In-Store Shoppin

g

Cable TV

Broadcast TV

80% of weekly In-Store Shopping takes place during midday

Radio Rules During Key Shopping Time

Source: 2014.1 USA TouchPoints. Reach of Media consumed Out of Home by Women 25-54 NET Mon-Sun. AM/FM Radio includes HD Radio and radio station streams; Internet excludes email; Television includes live and time-shifted viewing; Cable TV excludes premium channels

Radio is the medium most consumed during these peak shopping hours

Internet via Computer

HEAVY RADIO LISTENERS ARE ALSO HEAVILY ENGAGED WITH SOCIAL MEDIA

12% more likely to write online blogs

9% more likely to use Twitter

6% more likely to use Facebook vs. the average US adult

Note: Internet and Social Networking activities done in the last 30 daysSource: 2014 Doublebase GfK MRI. Heavy Radio Listeners 18+ (Quintiles I & II);

Radio has enormous power to multiply a brand’s message

Radio29B

Billions in Word-of-Mouth Impressions across all key product categories

49% more…Word of Mouth,Recommendations,Introductions,Trials & Sampling,Passing Along,Town Criers,Buying for Two,Friends Talking to Friends,Maven Activity,Spreading the Word

…Consumer BuzzSocial Media

19.4B

RADIO’S INHERENT SOCIAL PROGRAMMING + RADIO’S ACTIVE SOCIAL LISTENER = MASSIVE BRAND AMPLIFICATION

Source: Keller Fay Group. 2013

WHAT IS RADIO ROI?

A breakthrough collaboration between Nielsen and various partners creating the first single-source ROI tool for radio.

NIELSEN AUDIO DATA

CONSUMER DATA

Copyright ©2014 The Nielsen Company. Confidential and proprietary

$6.21

All Category Average

$11.15

Retail “Y”

SPENDING ON RADIO MAKE YOU MONEY…OVER $6 OF INCREMENTAL SALES FOR EVERY $1 SPENT

PAYBACK Per $1 Ad Investment

$1.81Breakfast Bar

$7.33

Snacks “X” $4.17Beer

Ratio of incremental sales revenue per thousand to advertising cost per thousand = Payback

$3.81Soft Drink “A”

$4.33Snacks “W” $23.21

Retail “Z”

$1.38Soft Drink “B”

$3.12Candy

$1.97Soft Drink “C”

Source: Nielsen Catalina Solutions Studies of 10 radio ad campaigns, March 26, 2014

RADIO GENERATED A $14 RETURN FOR EVERY AD DOLLAR SPENT BY A TELECO

NOTE: “Telco” spend defined as having made purchase from “Telco,” including but not limited to wireless plans and accessories.

MONTHLY SPEND PER EXPOSED

“Telco” CUSTOMER

People who heard ads on radio spent more and Millennials spent twice as much more

SOURCE: Nielsen Buyer Insights, P18+. Full Campaign (1/1/14-3/31/14

$14 : $1Campaign ROAS

+$8

+$16

Copyright ©2014 The Nielsen Company. Confidential and proprietary

RADIO DRIVES TV RATINGS

Nearly 1 in 5 listeners who heard the spot tuned into the TV broadcast.

Radio demonstrated

conversion rate for promos

16%

Online

Cinema

Radio

Television

2%

3%

18%

76%

Copyright ©2014 The Nielsen Company. Confidential and proprietary

RADIO DRIVES TV TUNE - IN

In only one week, radio delivered nearly

a QUARTER of the reach that TV did in 14 weeks.

Cable Drama Premier: Promo Campaign% of Campaign Reach by Platform

(1 week)

(14 weeks)

(12 weeks)

(10 weeks)

Copyright ©2014 The Nielsen Company. Confidential and proprietary

RADIO ADVERTISING KEEPS CUSTOMERS

Radio increased retention by as much as

for a big box retailer

Radio works well for driving

loyalty 11%

Advocacy

Affinity/Likeability

Purchase Intent

Consideration

Awareness

37%

38%

19%

23%

17%

Nine Study Average % Lift:

RADIO’S EMOTIONAL CONNECTION DRIVES BRAND METRICS ASSOCIATED WITH WOM

(Exposed consumers vs. unexposed consumers)

Source: Ipsos MediaCT / OTX Custom Research 2011-2013

RADIO IN THE MEDIA MIX ELEVATES AWARENESS LEVELS OF ALL OTHER ADVERTISING

TV Online on a PC Online on a mobile phone or tablet

0

20

40

60

40%

2% 1%

54%

8%

2%

No Radio Exposed to Radio

Awareness Lift Among Total Decision Makers

+300% +100%

Copyright ©2015 The Nielsen Company. Confidential and proprietary, study conducted in early 2015

35%

Q: Where else have you seen or heard advertising recently for X Brand?

I will consider buying the brand

I will visit the brand's website

I will look up more information about the brand

I am more interested in the brand

57%

51%

48%

55%

47%

39%

39%

44%

National Localized

+23%

+31%

+21%

BRAND ACTIONS

LOCALIZED ADS GENERATE BETTER REACTIONS THAN NATIONAL ADS

+25%

Source: Jan-Feb 2015 IPSOS study for Fortune 500 Insurance Co.

% LIFT

21%

34%

+13%

% B

ran

d A

wa

ren

ess

62%

Toyota TeenDrive365 Campaign – Aided Recall

Source: Ipsos MediaCT custom research 2014

Not Exposed to Radio

Exposed to Radio

RADIO ADVERTISING DRIVES BRAND AWARENESS

“We know based on the positive results that we have seen since launch that Radio will continue to be an important piece of the TeenDrive365 campaign.”

Marjorie SchusselCorporate Marketing DirectorToyota North America

Bra

nd A

war

enes

s Le

vels

+34%

Including radio in media campaigns significantly improves consumer awareness

Macaroni Grill and iHeartMedia Campaign -- Using a mix of 77% TV and 23% Radio

Source: Marketing Evolution Study for Macaroni Grill and iHeartMedia 2014

Not Exposed to Radio

Exposed to Radio

RADIO ADDS VALUE TO TV ADS

Adding radio to the mix can positively impact not only short term retail traffic objectives, but branding and sales metrics as well.

Eric Solomon, Senior Vice President and Managing Partner for Universal McCann

+1.3%

Frequency

Reach

Receptivity +62%

+41%

+17%

REALLOCATING 15% OF THE TV BUDGET INTO RADIO SUBSTANTIALLY INCREASES REACH, FREQUENCY AND RECEPTIVITY OF MESSAGES

Average Weekly % Improvement of Campaign Metrics

Notes: Results in each case study based on the specific target audience for that particular client; USA TouchPoints measures the social-emotional context of target audiences’ lives to identify the moments of highest receptivity, known as the Receptivity Potential Index.

Source: MBI TouchPoints Custom Research 2013

7 Campaign Avg.% Improvement

Auto 1 QSR 1 Financial Services 1 QSR 2 Financial Services 2Auto 2 Home Improvement

+8%

+15% +15% +16% +18%

+24%+28%+29%

+62%

+5%

+52%

+43%

+64%

+39%+42%

+64%

+47%

+84% +84%

+20%

+74%

Reach Frequency Receptivity

WHY RADIO DRIVES RESULTS

Massive reach of everyone, everywhere, with a high share of consumer usage but deserves a larger share of advertising budgets – Radio in the Media Landscape

Status as a trusted friend, with local focus and personal connections to content – Radio as America’s Companion

Dominant and unique position and experience in the audio universe, not replaced or displaced by music streaming services – Radio vs. Music Streaming Services

Real time use, dominating out of home and in car, generating traffic at the point of sale and highly targetable – Radio’s Unique Capabilities

Proclivity to reach listeners with higher levels of social connections and likelihood to generate massive Word-of-Mouth – Radio’s Power to Amplify

Unique ability to generate advocacy, brand affinity, intent to purchase and, ultimately, sales – Radio: Advertising that Works