Broadcasting (Oct 1931-Dec 1932)

Measuring Radio Advertising Sales Power Value of Selecting Proper Program is Emphasized By ROBERT F. ELDER Assistant Professor of Marketing, Massachusetts Institute of Technology Survey Reveals How Accurate Results Mav be Forecast; merc'ly certain diifrerences » p°weTr ^ J " to buy or m inclination to buy. It was attempted, by confining mailing to telephone homes, to obtain two groups of equal purchasing power. That this probably was achieved is indicated by the fact that the circulation of the higherpriced magazines was even greater in the non-radio-owning homes than in the radio homes. However, there still existed the possibility that the non-radio homes, although of ample purchasing power, represented a group of people of conservative buying habits, likely to remain uninfluenced by any form of advertising. But upon analysis it was found that the proportion of families using nationally advertised products was about the same in both non-radio and radio homes. The only significant difference was that radio advertised products had apparently displaced other nationally advertised products in radio homes. MANAGEMENTS today are increasingly demanding proof that every dollar of expenditure is earning a profit. When a plant manager wants new machinery, he must demonstrate that it will effect savings or improvements in quality sufficient to pay dividends on the investment involved. Similarly, the sales manager who requests an increase in his appropriation for the purpose of adding new salesmen must prove conclusively that the expenditure will earn a profit. Few people today doubt that advertising, properly done, is profitable. But whether advertising continues to forge ahead the next decade, as it has in the past, depends on the development of methods which measure its effect in tangible form. Although several promising beginnings have been made, the reduction of advertising to a scientific basis is far from accomplished. *It has been possible in a survey conducted in the past few months to measure the specific effect of radio broadcast advertising for a number of products in general use. By determining the brand preferences of a large number of families known not to own radios and comparing them with the brand preferences of other groups using radio sets for varying periods of time, it became evident: First: that a substantially larger proportion of radio homes than of non-radio homes purchase radioadvertised brands of merchandise. Second: that, conversely, a substantially smaller proportion of radio homes than of non-radio homes purchase brands not advertised by radio, where there is competition between radio-advertised and non-radio-advertised brands of the same commodity. Third: that the proportion of radio homes using radio-advertised merchandise is distinctly greater as the average listening time increases. HOW IT WAS DONE THE study involved the mailing of 100,000 questionnaires on business reply cards, each accompanied by a letter carefully worded so as not to influence replies, to homes in ten representative American cities, 10,000 to each city. To insure against any significant differences in economic levels between radio and non-radio homes, telephone DOES radio sell goods? Professor Elder in this informative article concludes that it does. His findings are based on an elaborate survey of advertising results among radio-using and non radio using homes conducted for CBS. Some 100,000 families were interviewed in ten representative cities. Robert F. Elder lists were used, thus practically excluding homes without appreciable buying power. The questionnaires inquired what brands were used of nine commodities, selected for the following qualifications: (a) articles in common use; (b) articles frequently purchased; (c) articles in general use by families in all economic levels; (d) articles some leading brand or brands of which is advertised by radio, and other leading brand or brands not so advertised; (e) articles which have in the past been heavily advertised in all media; (f) articles sold largely by advertising, with a minimum amount of personal salesmanship. The commodities finally selected were: toothpastes, shaving soaps, toilet soaps, scouring powder, flours, shortenings, cirgars, cigarettesand collars. A question as to what magazines were read in the home was inserted in an effort to avoid too great emphasis on the questions: "Do you own a radio?" and "About how many hours is it in use daily?" which were placed at the bottom of the card. A total of 14,061 usable replies was received. The cards from each city were sorted according to whether or not radio ownership was indicated, and according to the average daily listening time. The number of users of each brand of product in each category was tabulated for each listening-time group, and percentages calculated. EFFECTIVENESS OF RADIO THE general, over-all effectiveness of radio advertising is indicated by the fact that the average card from a non-radio home mentioned the use of three (3.07) products advertised by radio, while the average card from a radio home mentioned four (3.97) radio advertised brands. In other words, based on 121,888 brands mentioned on 14,061 cards, all radio advertised brands in the aggregate showed an increase of use of 29.3 per cent in radio homes compared to non-radio homes. Comparing homes in which the radio TASTES VARY BY BRANDS THE extent of the gain in radio homes naturally varied for different brands. In general, as was to be expected, these programs consistently maintained at a high level, using frequent intervals over a long period of time, showed the best results. Particularly in gaining the initial foothold, the frequency with which a program is on the air appears to be of great importance. Several comparatively new programs, on the air three or six times u • PRODU 6 z ILIES I F FAM 1 z u tt 10. HC )W ! iALE 5 OF PRC )DU< :t it> !CRE ASE IN 1 IAD I O HOME s AV ERAGF DAIL If LISTENING 1 TIME ■ _ i I was used over three hours daily with non-radio homes, the increase in use of radio advertised products was still greater, amounting to 36.1 per cent. This difference in brand preferences between homes with radios and homes without them immediately brings up the question as to whether we are measuring the specific effect of radio advertising, or a week, showed decisive gains in radio homes. The importance of proper attention to the selling talk in a program is indicated by the fact that one program which has ranked very high in popularitystudies showed only mediocre results in terms of new users created. There were wide differences in the results attained by most of the {Continued on page 82) November 1, 1931 • BROADCASTING Page 11