1. The POWER AND value of radio
SPEAKER NOTES:
MATT OPENING COMMENTS: Today we’re here at the invitation of the Southern California Broadcasters Association to share with you some insights into the power of the radio medium as we see it. Los Angeles and surrounding cities make up the largest radio market in the country in both geographical reach and, most importantly, ad revenue. What happens in Southern California radio impacts the entire radio industry as a whole, and almost exactly a year after Nielsen acquired Arbitron and created Nielsen Audio, we’ve brought radio onto equal footing with other mediums by being able to create single-sourced ROI tools that connect what consumers are listening to with what they actually buy.
It’s been a really exciting year and it was very important to Nielsen to make such a large investment in audio because its such an integral part of the daily lives of consumers everywhere.
I have a lot to share with you today, so let’s get started.
Tony Hereau
Vp, Audience Insights
June 18, 2016

2. LISTEN BUY SINGLE SOURCE
We can now link radio listening data to the actual transactions of more than 125 MILLION consumers and 80% of all American credit card holders.
LISTEN
BUY
Nielsen PPM Panel
72,000 panelists
125 MILLION Consumers
80% of all U.S. credit card transactions
SINGLE SOURCE

3. OBJECTIVE
Consumer Packaged Goods
10 Brands
Test Period: Q3 2013
To measure the sales impact of radio advertising in six major spending categories
Telco Provider
1 Brand
Test Period: Q2 2014
Department Stores
4 Brands
Test Period: Q3 2014
Mass Merchandisers
2 Brands
Test Period: Q2 2014
Home Improvement
2 Brands
Test Period: Q2 2014
QSR/Fast Food
3 Brands
Test Period: Q3 2014

4. QUESTION:
For every dollar spent in radio advertising, how much revenue should your business generate?
CHOICES:
(last was work for a big box retailer. We linked Nielsen audio data with credit card data. We looked at a radio campaign that ran over a 4 week period. The consumers who were exposed to the radio advertising campaign were 11% more likely to come back and shop again. With this example, frequency mattered. A consumer was 7% more likely to come back with 1 radio ad exposure but with 2+ exposure, the likelihood increased to 11%. While we only looked at one campaign, the improvement demonstrated by radio “shows well” versus what our seasoned researchers have previously seen for TV) $1 $3 $6
$10

5. CPG
$6:$1
Advertisers achieved over $6 of incremental sales for every $1 spend on radio
Key issue in the past is that advertisers couldn’t get a clear read on radio’s ROI.
New ROI work from Catalina shows we can get a sense of radio’s ROI with solid positive results.
Results of the Radio ROI from Catalina are positive and in line with findings from other media (TV and Digital).
6:1 is a very strong ROI but certainly influenced by the specific brands and cases (mix of retail and CPG) in the study so careful not to generalize
Average of 3:1 among the CPG brands in the study are higher than we typically see with other media at 2.5:1 (but still generally in line)
Sometimes ROI results can be negative and neutral so we won’t always see results like this.
We need more ROI studies like this to gain more insight about radio and we encourage broadcasters and advertisers to contact NCS and do more

6. OVER $6 OF INCREMENTAL SALES FOR EVERY $1 SPENT
Key issue in the past is that advertisers couldn’t get a clear read on radio’s ROI.
New ROI work from Catalina shows we can get a sense of radio’s ROI with solid positive results.
Results of the Radio ROI from Catalina are positive and in line with findings from other media (TV and Digital).
6:1 is a very strong ROI but certainly influenced by the specific brands and cases (mix of retail and CPG) in the study so careful not to generalize
Average of 3:1 among the CPG brands in the study are higher than we typically see with other media at 2.5:1 (but still generally in line)
Sometimes ROI results can be negative and neutral so we won’t always see results like this.
We need more ROI studies like this to gain more insight about radio and we encourage broadcasters and advertisers to contact NCS and do more
Ratio of incremental sales revenue per thousand to advertising cost per thousand = Payback

7. Methodology: EVALUATE SALES IMPACT for aggregate category ad spending and sales
DATA SOURCES
MEASURE THE IMPACT
RADIO AD EXPOSURE:
Nielsen Portable People Meter (PPM) Panel matched to Media Monitors commercial occurrence data
PURCHASE BEHAVIOR:
Credit & Debit Card Expenditures of 125 MM unique cardholders
80%+ US credit card transactions
30% of US debit card transactions
12B transactions accounting for a total of $1.2 trillion spent annually
SINGLE SOURCE DATABASE:
~40,000 Persons 18+
AD SPENDING: SQAD
ANALYSIS APPROACH:
Analysis Measures the Sales Impact of Aggregate Ad Spending and Aggregate Sales for all Brands Measured in the Category
EXPOSED GROUP: Listeners exposed to radio advertising on PPM measured stations for any of the brands measured in each category during the Test Period.
UNEXPOSED GROUP: Listeners not exposed to radio advertising on PPM measured stations for any of the brands measured in each category during the Test Period.
KEY METRICS:
Total Sales/Spend lift
Buyer Penetration
Transactions/Trips per Buyer
$$ per Transaction
$$ per Buyer
ROAS - Sales Return per Advertising Dollar

8. EXPOSED to radio advertising
Methodology: EVALUATE SALES IMPACT for aggregate category ad spending and sales
WEIGHTING FACTORS
Groups EXPOSED and UNEXPOSED to radio advertising were weighted to be identical on the following characteristics:
Age
Gender
Race
Education
Employment status
HH size
Presence of children
Buying history (prior spending/transactions)
Audience
EXPOSED to radio advertising
Audience UNEXPOSED
to radio advertising
Key issue in the past is that advertisers couldn’t get a clear read on radio’s ROI.
New ROI work from Catalina shows we can get a sense of radio’s ROI with solid positive results.
Results of the Radio ROI from Catalina are positive and in line with findings from other media (TV and Digital).
6:1 is a very strong ROI but certainly influenced by the specific brands and cases (mix of retail and CPG) in the study so careful not to generalize
Average of 3:1 among the CPG brands in the study are higher than we typically see with other media at 2.5:1 (but still generally in line)
Sometimes ROI results can be negative and neutral so we won’t always see results like this.
We need more ROI studies like this to gain more insight about radio and we encourage broadcasters and advertisers to contact NCS and do more
After weighting, the key difference in the two groups is RADIO EXPOSURE.
Each group has an equal opportunity to be exposed to other media where the campaign is running. 

9. Payment Methods used most often
SHARE OF WALLET: CREDIT & DEBIT CARDS USED MOST OFTEN FOR PURCHASES IN MAJORITY OF CATEGORIES
Payment Methods used most often
73% of people use Credit or Debit cards most often for department stores purchases
68% of people use Credit or Debit cards most often for mass merchandiser purchases
Credit Card
Debit Card
Cash/Check
72% of people use Credit or Debit cards most often for home improvement purchases
Other
46% of people use Credit or Debit cards most often for QSR purchases
56% of people use Credit or Debit cards most often for telecom purchases
Nielsen 2014 Share of Wallet Study

10. 3 pillars that drive Return on Advertising Spend
MORE BUYERS
BUYERS SHOPPING MORE OFTEN
BUYERS SPENDING MORE PER TRIP

11. TELCO PROVIDER $14 OF INCREMENTAL SALES FOR EVERY $1 SPENT
Consumers who heard the radio ad campaign spent an average of $8 more per month on the Telco services than those who were not exposed
The average Millennial who heard the ad spent $16 more per month than those who did not
$14 ROAS
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT:
$210,000,000
Incremental spend for customers exposed to the radio campaigns in Q1 2014
$15,300,000
Total Q radio ad spend

12. QSR/FAST FOOD $3 OF INCREMENTAL SALES FOR EVERY $1 SPENT
EXPOSURE TO RADIO CAMPAIGNS DROVE A 6% INCREASE IN SALES OVERALL
RADIO DROVE MORE PEOPLE INTO THE RESTAURANTS AND THEY SPENT MORE EACH TIME
6% increase in
total number of buyers
1% increase in
$ spent per buyer
$3 ROAS
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT:
$87,302,965
Incremental spend for customers exposed to the radio campaigns in Q3 2014
$29,044,889 *
Total Q radio ad spend
Q for Three brands compared to prior 3 months
* Ad spend source is SQAD

13. DEPARTMENT STORES $17 OF INCREMENTAL SALES FOR EVERY $1 SPENT
EXPOSURE TO RADIO CAMPAIGNS DROVE A 10% INCREASE IN SALES OVERALL
RADIO BROUGHT IN MORE SHOPPERS AND THEY SPENT MORE EACH TIME THEY SHOPPED
3% increase in
total number of buyers
6% increase in
$ spent per buyer
$17 ROAS
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT:
$356,966,946
Incremental spend for customers exposed to the radio campaigns in Q3 2014
$20,999,788 *
Total Q radio ad spend
Q for Four brands compared to same time prior year
* Ad spend source is SQAD

14. Home improvement $9 OF INCREMENTAL SALES FOR EVERY $1 SPENT
EXPOSURE TO RADIO CAMPAIGNS DROVE A 4% INCREASE IN SALES OVERALL
RADIO CAMPAIGN EXPOSURE DROVE MORE PEOPLE TO SHOP AND TO SHOP MORE OFTEN
8% increase in
total number of buyers
2% increase in
$ spent per buyer
$9 ROAS
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT:
$368,666,119 Incremental spend for customers exposed to the radio campaigns in Q2 2014
$38,885,290 *
Total Q radio ad spend
Q for two brands compared to same time prior year
* Ad spend source is SQAD

15. MASS MERCHANDISER $16 OF INCREMENTAL SALES FOR EVERY $1 SPENT
EXPOSURE TO RADIO CAMPAIGNS DROVE A 1% INCREASE IN SALES OVERALL
RADIO WAS SUCCESSFUL AT GETTING MORE PEOPLE INTO THE STORES AND
THEY SPENT MORE WHEN THEY SHOPPED
2% increase in
total number of buyers
2% increase in
$ spent per buyer
$16 ROAS
IMPACT OF RADIO EXPOSURE
RADIO AD INVESTMENT:
$227,707,290
Incremental spend for customers exposed to the radio campaigns in Q4 2014
$13,908,650 *
Total Q radio ad spend
Q for two brands compared to same time prior year
* Ad spend source is SQAD

16. Radio advertising positively impacts BOTTOM LINE SALES for many categories
RADIO PAYBACK PER $1 AD INVESTMENT
RETAIL (B)
$23.21
DEPARTMENT STORES
$17.00
MASS MERCHANDISERS
$16.37
TELECOM
$14.00
RETAIL (A)
$11.15
HOME IMPROVEMENT
$9.48
SNACKS (A)
$7.33
SNACKS (B)
$4.33
BEER
$4.17
SOFT DRINK (A)
$3.81
CANDY
$3.12
QSR
$3.01
SOFT DRINK (C)
$1.97
BREAKFAST BAR
$1.81
SOFT DRINK (B)
$1.38