Resisting Radio Advertising

  The rise of radio advertising in the United States was tentative and slow. Advertising first appeared in 1922 on station WEAF in the form of sponsored time. Other stations gradually accepted sponsored programs, but many broadcasters viewed advertising agencies as competitors and were hesitant to sell them time or allow sponsorships. Anti-advertising rhetoric from listeners, critics, legislators, and regulators fueled opposition as well.

     Surprisingly, advertisers and agencies distrusted the notion of radio advertising. Agencies doubted that radio advertisements would work, a sentiment shared by many advertisers. The advertising industry also believed listeners might resent radio sponsorship and, consequently, reject other forms of advertising by the same advertisers. This was of particular concern to print advertisers and their agencies.

     For several years agencies warned their clients against using radio advertising. Advertisers had to produce programs themselves with assistance from station personnel. For example, in 1925 Clicquot, a soda manufacturer, worked directly with WEAF to create the Clicquot Club Eskimos music program because its agency did not believe in radio. There were, however, exceptions.

     William H. Rankin of the Rankin advertising agency decided to test radio advertising before recommending it to clients. He bought time on WEAF for a talk about advertising but received only a small number of letters and phone calls in response. One, from a prospective client, Mineralava, led to a contract and more radio advertising. Rankin began recommending radio and another client, the Goodrich Company, sponsored a radio series.

     Another early exception was the N.W. Ayer agency, which supervised The Eveready Hour in 1923. Ayer ensured that the show was professional and identified the sponsor in the name. The favorable attention it received attracted other sponsors to radio, with shows such as the Bakelite Hour, The Victor Hour, and The Ray-O-Vac Twins. These shows became models for later network programs.

     Although opposition to radio advertising persisted into the mid-192os, most advertising practitioners were beginning to consider its use. To win them over, the newly formed National Broadcasting Company (NBC) and Columbia Broadcasting System (CBS) radio networks hired promoters to persuade those still skeptical about the effectiveness of radio advertising. In 1928 NBC initiated a promotional campaign to educate and encourage adoption of radio advertising. The networks targeted leading advertisers and agencies with brochures highlighting radio success stories and emphasizing radio's ability to build brand awareness and stimulate dealer goodwill. The net­ works also offered financial incentives by paying agencies commissions even if they were not directly involved in a client­ sponsored show.

     NBC loaned its employees to leading agencies to help develop radio departments. N.W. Ayer started the first full­-scale radio department in 1928 and others soon followed, employing personnel who migrated from radio. The promoters urged the networks to allow agencies to sell broadcast time and produce programs. In turn, agencies recognized how lucrative program development and production could be.

Accepting Radio Advertising

      The promoters' efforts were successful. By the early 1930s agencies were selling time and handling nearly all sponsored network program development and production. Agencies had gained control of prime-time radio listening and achieved great prosperity, and their radio departments became centers of power.

     Sponsored radio shows of the 1920s employed "indirect advertising," simple mentions of the program's underwriter with no product description or sales pitch. The networks supported this practice with policies against direct advertising. George Washington Hill, president of the American Tobacco Company, and Albert Lasker, head of the Lord and Thomas agency, pressured the networks to allow explicit advertising messages.

     Although Lasker and Hill largely conformed to the indirect advertising requirements when they launched the Lucky Strike Dance Orchestra in 1928, Hill, who believed strongly in intrusive radio advertising with explicit product claims, aggressively pursued this goal by forcing the issue with network executives and supporting Lucky Strike with extravagant budgets. Lord and Thomas controlled a large share of NBC's business, so Lasker had leverage as well. By 19 31 women were being sold Lucky Strikes with mildness claims by opera and film stars and "slimming" messages suggesting that listeners smoke a Lucky Strike instead of eating something sweet.

     The 1930s saw advertising agencies crafting selling environments for their clients in the form of elaborate comedy, variety, and dramatic series. Vaudeville came to radio as agencies began to use star talent. Young and Rubicam created The Jack Benny Program for General Foods' Jell-O. Lord and Thomas produced Bob Hope. J. Walter Thompson produced the Kraft Music Hall with Bing Crosby and The Chase and Sanborn Hour with Edgar Bergen and Charlie McCarthy.

     After commercializing prime-time radio, the networks, with agency help, developed a daytime audience of women listeners. The networks developed 15-minute sponsored talks with recurring characters and continuing stories. Soap operas­ melodramatic serials typically sponsored by manufacturers of household detergents and cleaners-were born.. Most were produced by advertising agencies.

     One agency, Blackett, Sample and Hummert, built a reputation for soap opera programming. Glen Sample adapted a 1920s newspaper serial into a radio show, Betty and Bob, sponsored by Gold Medal Flour. Sample also developed the long-running Ma Perkins for Procter and Gamble's Oxydol. In 1931 Frank and Anne Hummert created a daily NBC serial, just Plain Bill, for Kolynos toothpaste. The Hummerts became highly prolific soap opera creators, developing nearly half the network soap operas introduced between 1932 and 1937. Soap operas were so successful that daytime radio advertising revenues doubled between 1935 and 1939.

     Agencies and radio networks were determined to protect their financial success during the Depression. Indeed, their program decisions uniformly ignored economic and social problems. With the exception of The March of Time, produced for Time magazine by Batten, Barton, Durstine and Osborn, news was all but missing from sponsored programs. Radio's skilled entertainers kept Americans' minds off their despair,

     The radio and advertising industries experienced continued prosperity during World War II. Agencies encouraged clients to maintain brand awareness, even if they had no products to sell, and radio benefited from such prestigious sponsorships as General Motors' NBC Symphony Orchestra as well as benefiting from paper shortages that limited newspaper ads. Both industries assisted the Office of War Information with insertions of war effort announcements, earning them favorable government treatment when their wartime revenues came under close scrutiny.

U.S. Postwar Changes

      Envious of the power held by advertising agencies, the radio networks decided to regain control of programming. The agencies lost ground to independent producers, but the real threat to radio came from the growing medium of network television. Advertisers and their agencies shifted the system of star-studded, sponsored programs to television. Young and Rubicam found that its programs moved so easily to television that from 1949 to 1950 half of the top 10 TV shows were its productions.

     Within a decade, network radio serials and soap operas had all but disappeared, taking with them substantial ad revenue. Whereas in 1931 network advertising constituted sr percent of total radio advertising revenues, by 1960 that had fallen to just 7 percent. Radio survived by serving local listeners with format programming and attracting local advertising.

     U.S. agencies became producers of commercials and buyers of spot radio time. Despite periods of renewed interest in radio and a resurgence of radio networks, for national advertisers and their agencies radio was relegated to the role of support medium.

Lobbying for Commercial Radio in Britain

      The BBC's license forbids it from broadcasting advertising or sponsored programs. Other than English-language radio broadcasts from foreign and pirate stations, commercial radio did not officially exist in the United Kingdom until 1972. Still, from the start of British radio, advertising agencies lobbied for commercial broadcasting, which held out the possibility of more advertising business. Advertising on the BBC and the creation of a parallel commercial radio system were repeatedly ruled out by successive government inquiries.

     In 1923 the Sykes Committee on Broadcasting heard advertising agencies' arguments, but found that radio advertising would unfairly benefit large advertisers, negatively affect the advertising revenues of the press, and lower broadcast program standards. Over a decade later the Ullswater Committee ( 1935) reaffirmed the Sykes Committee's conclusions.

     Long before commercial radio arrived in the United King­dom, a well-organized radio advertising industry was promoting products to a large British audience through English­ language programming on foreign stations. These broadcasts emanated from many stations, the most well known of which were Radio Luxembourg and Radio Normandie. English-language broadcasting experiments in continental Europe during the 1920s attracted British listeners and sponsors. In 1929 Radio Publicity Limited started organizing English-language programs for record, food, toothpaste, and cigarette manufacturers. A year later the entrepreneurial Captain Leonard Plugge founded the International Broadcasting Company (IBC), also to arrange commercial programs.

     Sponsored shows were usually produced and recorded in Britain and shipped to continental stations for transmission. The IBC established itself as a production facility, and leading British advertising agencies such as J. Walter Thompson and the Lon­don Press Exchange handled their own program production.

By 1936 radio advertising expenditures exceeded for million, and dozens of major advertisers, such as Lever Brothers, MacLeans, Carter's Liver Pills, and Cadbury Brothers, were on Radio Luxembourg and Radio Normandie. J. Walter Thomp­son's major clients, including Rowntree, Horlicks, Ponds, and Kraft, were also substantially engaged in radio advertising. Between 1936 and 1939 Ponds and Horlicks spent 20 percent and 33 percent of their total advertising budgets, respectively, on radio. Radio advertising was sufficiently established by 1938 that British manufacturers spent over 1.5 million franks. Agency Mather and Crowther Limited compiled Facts and Fig­ures of Commercial Broadcasting, and J. Walter Thompson provided prospective clients with a promotional recording showcasing their radio expertise.

     After World War II Radio Luxembourg resumed its service to British advertising agencies and their clients; however, television lured listeners and advertisers away from radio. In 1946 the Institute of Practitioners in Advertising (IPA), an advertising industry association, published Broadcasting: A Study of the Case for and against Commercial Broadcasting under State Control in the United Kingdom, which claimed that commercial broadcasting had value to advertisers and the public. The IPA's recommendation was not to dissolve or create competition for the BBC but to allow commercial broadcasting within the BBC's existing structure.

     The IPA monograph became an important piece of evidence examined by the Beveridge Committee (1949), which considered the introduction of commercial broadcasting. The advertising lobby was active in providing evidence and scrutinizing that of others, with J. Walter Thompson, for instance, helping to prepare materials presented by major advertisers, including Horlicks, Unilever, and Rowntree. The Beveridge Committee decided against commercial broadcasting, but a minority report proposed a system of national and local commercial radio that would later become a reality.

     In the mid-196os pirate radio stations, broadcasting from old forts and ships anchored just outside British territorial waters, afforded advertising agencies and their clients another opportunity to circumvent the United Kingdom's no-commercial-radio policy. The success of these stations appears to have finally led to officially sanctioned commercial radio. Advertising agencies continued to lobby for commercial radio and helped win Conservative Party support for the 1972 introduction of commercial local radio. Even after commercial radio became a reality, agencies worked to influence BBC policy.

Agencies and British Commercial Radio

     The IPA joined others in 1984 to question the noncommercial future of the BBC. Two large agencies, D' Arey MacManus Masius and Saatchi and Saatchi, issued reports indicating that advertising would allow the BBC to meet its revenue needs without raising the license fee paid by listeners. Polls indicated that the public was willing to accept this arrangement, but the Peacock Committee, which was considering the issue, rejected this option.

     The BBC remains noncommercial and dependent on receiver license fees. Ironically, BBC Radio has established a commercial arm, Radio International, that allows sponsorship and advertising on the programming it markets for overseas consumption.

     The 1972 Broadcasting Act established commercial Independent Local Radio in the United Kingdom, opening the door for agencies to offer radio copywriting and time-buying services; however, national advertisers and their agencies were slow to embrace commercial radio for several reasons, including incomplete geographic coverage, which precluded national reach; a lack of credible audience measurement; and restrictive advertising regulations.

     In the nearly two decades that these barriers were being addressed, commercial radio struggled, developing a reputation as a "two percent medium," unable to attract more than two percent of British advertising revenues. By the early 1990s advertising time and sponsorship restrictions were lifted; coverage was essentially complete, with over 130 local broadcasters on air plus a new national station; and a new audience measurement system was in place. Nevertheless, agencies continued to ignore the medium or simply used it as a campaign extension.

     A Radio Advertising Bureau marketing campaign targeting agencies and advertisers helped sell advertisers and their agencies on radio. Commercial radio started to shake its reputation in the mid-199os when a number of blue-chip advertisers first used radio. Foote, Cone, and Belding and Ogilvy and Mather directed Lever Brothers' brands Surf and Radion, respectively, to the medium. J. Walter Thompson also encouraged Kellogg to test radio in London and Jaguar to launch a promotion for its XJ models.

     The number of commercial radio services continued to grow, exceeding 250 by the close of the 1990s. Between 1992 and 2002, commercial radio revenue increased 395 percent and national radio buys accounted for over 60 percent of radio advertising revenue. Radio was Britain's fastest-growing medium and its share of advertising revenues exceeded six percent.