Profit motive: Ads become more prominent amid squeeze in industry

By: CHRIS BAGLEY - The Californian | Saturday, January 5, 2008 9:07 PM PST ∞

As media and entertainment businesses struggle to keep revenue up amid a sluggish economy and new competition for consumers' attention, local advertisers are finding themselves with more prominence on airwaves and front pages.

KTMQ 103.3 FM and The Californian have become the latest media outlets to make the shift, joining a growing number that already do so. Disc jockeys on the Southwest County radio station and a sister station in San Diego, KGB 101.5 FM, recently began to weave paid promotions into their weekday-morning banter.

In September, The Californian began selling advertisements on the front pages of its local and sports sections, a practice that was rare among newspapers until a couple of years ago.

The trend has played out nationally over the last decade with the rise of the Internet, satellite radio and digital video recorders such as TiVo, innovations that give consumers more control over what they read, watch and hear.

Many a Southern California driver will change the station before tolerating another spot for a bail bondsman. And young newshounds who like clicking on to the next article on the Internet don't necessarily browse all the advertisements on page A-5 after reading the second half of that story from the front page.

The trend also extends to films, sitcoms and "reality" television programs, where companies have been paying to put their cars and soft drinks on screen for years. The value of product placement grew from $1.6 billion in 1999 to $3.5 billion in 2004, according to PQ Media LLC, a research firm.

"Marketers are struggling to get people's attention," said David Stewart, dean and marketing professor at UC Riverside's graduate school of business management. "If you embed something in the entertainment itself, you keep people viewing it."

On KTMQ and KGB, several playful exchanges between morning hosts Dave Rickards and Shelly Dunn in the last few weeks have played up, among other businesses, a chain of mattress stores. Though the exchanges have a vaguely scripted feel and can be easily identified as ads by a listener who has heard one more than once, they aren't immediately distinguishable from Rickards' and Dunn's usual spontaneous, irreverent banter.

Judy Zulfiqar, a Temecula-based advertising consultant, said that's part of the reason why DJs make great pitchmen.

"They're like a friend," Zulfiqar said.

The twin stations, owned by Clear Channel Communications Inc., feature rock music from the 1960s into the 1990s and are aimed mainly at men ages 25 to 60. Clear Channel advertising managers couldn't be reached for comment.

Particularly during the morning hours, KTMQ has recently begun to air more ads featuring voiceovers by Rickards, including one for a Nissan car dealership and one for an upscale steakhouse in San Diego's downtown Gaslamp Quarter.

Chris Carmichael, who runs the Web log sdradio.net, said voiceovers by single hosts and the two-DJ "ad-lib spots" are becoming more common on the ClearChannel stations and on other San Diego-area stations, particularly news- and talk-radio stations such as KFI, KFMB and KOGO.

"Those clients typically pay very well," Carmichael said. "In a morning show like that, you're talking thousands of dollars."

DJs usually get a sizeable bonus from the voiceovers, too, he said.

Radio hosts have promoted consumer goods for most of the history of the medium. Most notably, newscasters on public radio and hosts on programs as august as the Grand Ole Opry have long helped fund the programs by reading a few lines from the advertisers.

Zulfiqar said advertisers have to vary the delivery continually to keep their messages fresh and consumers engaged.

Varinda Missett, who directs the advertising sales for The North County Times newspaper, including its Riverside County edition, The Californian, said variety has been a big part of the ads' appeal for clients who already advertise in the newspaper. Known as "front-page billboards" in ad lingo, the ads usually run as two-inch strips across the bottoms of pages on Thursdays, Fridays, Saturdays and Sundays. They sell for up to three times as much as other similarly sized advertisements, Missett said.

The newspaper industry has struggled to maintain advertising revenue in recent years, particularly in the face of Web sites that post searchable classified ads at little or no charge.

Nationwide last year, newspapers took in $46.6 billion for print advertisements, an amount that has barely budged since 1999, according to the Newspaper Association of America. Online advertising revenue grew to about $2.7 billion last year, up from virtually nothing a few years ago.

The North County Times began selling ads on its section fronts only after the retirement of Publisher Dick High, who had resisted pressure to do so, Missett said.

So far, the newspaper has offered the section-front ads only in conjunction with advertisements elsewhere in the newspaper, she said. They've been particularly popular with car dealers and casinos.

Front-page newspaper ads were common through the first half of the 20th century, but disappeared from all but the smallest and most locally focused publications. Newspapers bringing them back in the last couple of years include the Los Angeles Times and The Wall Street Journal.

Journalists at many newspapers have fretted that such prominent ads might degrade the value of their news reporting. But the potential revenue was too great to ignore in lean times, Missett said.

"That's where the eyeballs are," she said. "For advertising, it's totally paying off. They're looking for the passive readers who might not always look at the classifieds; they're looking for their kids' soccer score and then it's 'Hey, look at that truck.'"

Contact staff writer Chris Bagley at (951) 676-4315, Ext. 2615, or cbagley@californian.com.

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