Media Buyers Debate Radio at 4A’s

Radio consolidation isn’t quite the bogeyman for media buyers that it was two years ago when the Department of Justice’s Dando Cellini distributed his phone number to the agency world and J. Walter Thompson’s Jean Pool squared off with CBS chief Mel Karmazin.
At this year’s meeting of the American Association of Advertising Agencies in New Orleans, radio consolidation drew jeers and barbs, but it has also gained some fans.
In the opening session, Karmazin sparred with Saatchi & Saatchi executive vice president, executive media director Allen Banks, a critic of Karmazin’s zeal for consolidation. Agencies that bemoan consolidation are “like the pot calling the kettle black,” quipped Karmazin. “You have the power to say no.”
Pool, executive vice president, director of media services, who has been an outspoken critic of consolidation from day one, still isn’t buying Karmazin’s line.
“Radio has gone too far,” she said, calling Karmazin the “evil emperor of consolidation.” Her beef: In many markets, two owners often control 51-90 percent of the market and have staked out dominance in particular demographics and formats. “If you look at the top five stations, we’re seeing 150 to 200 percent rate increases. We’re going to get killed.”
Karen Agresti, senior vice president, associate media director at Hill, Holliday, Connors, Cosmopulos, has found a lot to like about consolidation. It has reduced the number of phone calls she needs to make and the number of people with which she must negotiate to place radio time. “It costs me the same amount of time to do a TV buy as it does a radio buy, and we make more money in TV,” she explained.
Group buys are the key, said Agresti. “It’s scary stuff, but you can use their new clout to your advantage. I can cut great deals and get multi-station discounts. I can reach 40 percent of a market plus get market-wide promotions that go four to five stations deep. That’s marketing, not radio buying.”
But only if groups survive Wall Street pressures, noted Pool. To her, Chancellor on the block “is a healthy sign” that consolidation isn’t all it’s cracked up to be, especially if the company is forced to sell off its media components piecemeal. Said Pool: “Now we’ve got to do something about Mel.”