Distressed Cash Radio Buys vs. Per Inquiry Radio
By Bill Sullivan
The continuing difficult economy has obliged radio advertisers across the country to try a wide array of ROI-focused tactics. One of the most popular methods has been a pay-per-inquiry strategy that we have been recommending to our clients for a number of years. But although per inquiry radio may seem the obvious choice, it often makes better business sense to make a distressed cash radio buy first.
We get calls from all over the world from clients who want us to place per inquiry radio for them. Unfortunately, most have very little real understanding of the relative costs and value of distressed cash radio buys. They skip the distressed cash radio buy test and focus mainly on per inquiry radio because they can get radio airtime at no cost and pay only for performance.
The Choice Isn’t Always Obvious
That sounds like a good deal, a safe way to make money. However, there are other factors to consider. For example, a client with a mass-appeal product, strong radio creative, low media costs and an effective telemarketing operation can generate a much lower cost per call than what a radio station will accept as a per inquiry deal. Let’s say the distressed radio buy generates a $10 or even a $5 cost per call. Most radio stations will not accept a per inquiry deal for less than $20 to $30 per call. If clients skip the distressed radio buy, they will never know their real radio metrics or national rollout potential. In this particular example, the client will quickly see from a distressed cash radio buy how much he or she can save per call and how much greater call volume and sales they can receive.
Before we help clients build a per inquiry radio campaign, we perform a one-week distressed cash radio test to determine exactly what the cost per call is. If a distressed cash radio buy generates, say, a $5 or $7 cost per call, we know that’s where the client should stay. The client is very happy to pay $5 per call rather than $15 or more for a per inquiry deal.
If necessary and possible, we make whatever adjustments a radio campaign needs from creative to media buying, to telemarketing to help our clients’ operations reach their lowest cost per call level. After running 60 radio campaigns last year, we have concluded that the lowest cost per call for distressed cash radio buys are those that generate $1.50 to $2 cost per call.
A word of caution: Be sure you work with experienced direct response radio professionals who know how to test and measure the elements of your operation to properly determine whether a distressed cash radio buy or a per inquiry deal makes the most sense for you.
Bill Sullivan, Director of Business Development with Lockard & Wechsler Direct
or call Bill at (973) 214-4447