My understanding of this is that the local radio station receives only a small percentage of the amount charged to the local business. I don't see it as anything illegal but surely not kosher to the advertiser or the local radio station. Are you familiar with any companies like this? I believe one of them is in Chicago. Not sure how to tell a local advertiser they got fleeced by this company.
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Outside firm selling "PSA's" on local radio stations to local businesses.
- Thread starter Jonas Jones
- Start date
Yes, it's a pretty common thing. I can't remember the name; but there used to be a company that used to broker spots, mainly to smaller market stations with open inventory, who wrote and sold spots with a public service bend. Copy would go something like this: 'Beltsville True Value wants you to be safe in 2024, by always buckling up and being sure to keep kids out of a hot car. This public service announcement is from your local hardware store, True Value Hardware on Main Street in downtown Beltsville.'
...and I'm correct that the local station only gets small percentage of what the advertiser paid?
That's correct. As I recall, it's a flat rate to the station per spot, and it's not much. But, given the landscape reality of today, anything is better than nothing.
Yup, the agency charges pretty exorbinant rates... and the buy is for some incredibly small number of ads.. like 3 in 3 days... and the station gets a very small amount.
been there done that burned the tshirt
I've worked stations that did this (and even a couple of rated stations in Houston ran some in the evenings and weekends). There are two telemarketing companies in Chicago who contract with stations to sell up to X number of spots a week (usually detailed by hour) and a bare bones rate for the station. It's not a constant deal but rather maybe once every couple of months you get a big batch from them with your cut. They might sell businesses at $75 a spot when you get $5. In a small market, we got $1 and they charged $25-$30 a spot. Keep in mind they find the client, sell them and collect the money, providing you the written text with an option for them to send you an audio file. They hit businesses by category and are very good at selling those businesses you'd never call on (example: a company that did flooring for casinos around the world).
A guy I worked with had a company where they went town to town. They'd get a small town station to let them come to town. They'd create some feature (ie: community history) from a Chamber of Commerce brochure and pay the station 10% of the take. They'd trade a restaurant and motel room. Then they'd call everyone in the phone book, sell them over the phone and once somebody said yes, a fine looking lady went to get the check and drop off the order. They'd have another station lined up and be on the road by the end of the week usually with at least $5,000 in their pockets (by 1992 prices). I called him employed homeless because he lived in motels.
A guy I worked with had a company where they went town to town. They'd get a small town station to let them come to town. They'd create some feature (ie: community history) from a Chamber of Commerce brochure and pay the station 10% of the take. They'd trade a restaurant and motel room. Then they'd call everyone in the phone book, sell them over the phone and once somebody said yes, a fine looking lady went to get the check and drop off the order. They'd have another station lined up and be on the road by the end of the week usually with at least $5,000 in their pockets (by 1992 prices). I called him employed homeless because he lived in motels.
Cold Coffee
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I always steered clear of this. It can hurt you when the shop next door gets spots at a lower rate. It's a better idea to have your sales staff do the selling. Running this will make your station look like a loser station.
Long ago a guy named Jerrell Shepherd gave me some lessons about sales and managing money.
Long ago a guy named Jerrell Shepherd gave me some lessons about sales and managing money.
In 73 or 75 Phil Immerglick started a company in Chicago called PSI that split 60/40 with the stations. The station got 40%. My little Ohio station took $13,500 twice a year from PSI which was great for the time. The spots were public service and everyone was happy as he didn't charge a lot per spot. But, nothing lasts forever and my competitor got greedy. A second cut throat company had been formed by another Chicago guy whose name I won't mention and they blasted the market apart for my competitor. Phil's company was polite and easy going on the phone the other was not. They screamed at people said things like " what's the matter don't you have ten dollars " and hung up. They destroyed the market for these PSA's in our area and the twice yearly haul went to about $4,000. Later companies have been formed but the taint of telephone sales remains.
I don't know if that's always the case, especially today and given the circumstances. Would most smaller market stations like to sell local direct at higher rates? You betcha. The problem is given local businesses are being driven out of town by the likes of Amazon, Home Depot, and Walmart, beggers can't be choosers. Heck, even back when I owned stations, if there was open inventory that I could get a couple of bucks for nights and weekends versus running network spots or PSA's, I'd take that in a heartbeat provided the spot lengths at that lower rate didn't conflict with my local sales.
Much has changed since long ago.
Great example. That's why we can't have nice things.
Yup. I remember working the week between Xmas and New Year's and this telemarketing agency sent a pile of these ads through with very short notice.
If you happened to be listening on New Year's Eve, you would have heard me reading a bunch of 30 second spots that all sounded kinda preachy. It was all me because there was no time to find someone else to produce some of them on a holiday week
"Mobil of Davis reminds you: Don't drink and drive in 2004. And come back to buy American refined oil from Mobil of Davis located on 7th Street"
"Davis Appliances wants our loyal customers to come back in 2004. Drive sober this New Year's, Come find us for refrigerators, TVs and mattresses at the corner of Main and 23rd in Davis. Offering free delivery in Davis"
"Hillside Nursing Home on 12th Street brings you an important message for 2004. Find a designated driver. This message was sponsored by Hillside Nursing Home in Davis"
The GM thought this telemarketer was a good prospecting tool. If the telemarketer could get $200 out of these businesses, maybe our sales staff could get money from them too. And honestly, it worked sometimes.
If you happened to be listening on New Year's Eve, you would have heard me reading a bunch of 30 second spots that all sounded kinda preachy. It was all me because there was no time to find someone else to produce some of them on a holiday week
"Mobil of Davis reminds you: Don't drink and drive in 2004. And come back to buy American refined oil from Mobil of Davis located on 7th Street"
"Davis Appliances wants our loyal customers to come back in 2004. Drive sober this New Year's, Come find us for refrigerators, TVs and mattresses at the corner of Main and 23rd in Davis. Offering free delivery in Davis"
"Hillside Nursing Home on 12th Street brings you an important message for 2004. Find a designated driver. This message was sponsored by Hillside Nursing Home in Davis"
The GM thought this telemarketer was a good prospecting tool. If the telemarketer could get $200 out of these businesses, maybe our sales staff could get money from them too. And honestly, it worked sometimes.
Someone on this board called them "cheese nips". There were several companies that sold them nationally in phone rooms. Some were less than reputable. I got to know a rep in Phoenix who built his own shop. Sometimes at one particular station, we'd follow up on some of those accounts and they thought they had made a charitable contribution. Jason Jennings and other consultants would train an in-house rep to do that. KWIX/KRES in Moberly, MO had an entirely telemarketing department, and offered seminars to other stations.
Thank you all very much for your valuable input.
I worked at a small market AM/FM in the early 1970s and we had these kinds of season's greetings announcements, all simply voiced, sometimes prerecorded to add variety to the voices on Christmas day, maybe New Years, as well.
Nothing handled outside the station, all sold to many advertisers without any agency input or involvement.
I think we just had some script books and we'd change the names of the advertisers per a log sheet.
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I just came across a piece of copy for a 30-second spot I cut long ago for Radio Advertising Inc./Radio Accounting Service Inc. on West Peterson Ave., in Chicago. Like you guys said, the first 15-seconds concerned the topic at hand and the second 15-seconds stated that the message was courtesy of XYZ Company, along with the business's address and telephone number.
Man, I remember cutting a ton of these when I was starting out. Script always looked like it came off a old dot matrix printer…
As I recall the Moberly, MO station was the first small market to achieve $1 million in advertising revenue. That would be likely 5 or 6 million in today's dollars. I recall an article where the GM was saying they raised the AM airing of Paul Harvey because they learned a client in town was trying to buy out the current sponsor. Another thing, the Moberly station ran zero PSAs at the time. You had to declare how many weekly PSAs you would run along with your news, public affairs and other non-entertainment percentages to the FCC and that could be a factor at renewal time back then. The Moberly station sold the PSAs and then for public service was directly involved with numerous causes.
We had those at my first station, too. The copy would have (sponsor name) about ten seconds in and then again at the end, and the easiest way to do that was to have a list of sponsors off to the side---check one off as you read it and next time, read the next sponsor.
It wasn't just small-market radio stations that did that. In 1971, KMPC in Los Angeles did the same thing, and the legendary Gary Owens didn't look ahead to see who the sponsor was, resulting in this:
Oh, there's much, much more to the story.
Jerrell Shepherd was brilliant. KWIX and KRES were fine-tuned money machines that would sell the crap out of anything. It was the type of programming that would make a typical program director cringe. But it worked. The stations not only sold local sports, but local sports banquets, and FFA banquets, and just about any other type of event. The sales reps were relentless. One of my college roommates came from a family that owned a furniture store in Shelbina. They didn't advertise on radio; Moberly was too far away (so was Hannibal as far as they were concerned). But at least once a week, or sometimes more often, there would be a KWIX/KRES sales representative stopping by.
Every program was sold - "Party Line", "KWIX Sale Time", "Big K News", ag reports, you name it. Shepherd probably sold the sign-on and sign-off, too.
Shepherd paid attention to technical matters as well; after all, he started out as an engineer. The KWIX AM antenna was 5/8 wave; the FM went to full class C status well before anyone else in the area. While northern Missouri was becoming more sparsely populated, the regional coverage more than compensated.
All of this enabled Shepherd to pay well, and he did. Salary levels were comparable to those in Columbia, the regional center, and sometimes better. There were no "announcers" as such; instead, on-air staff were called "programmers" and were expected to handle news and sports as well as music. On KWIX, the AM, music was essentially filler anyway; KRES(FM) was a little more intentional regarding music (country) but news and sports always took precedence. And they did a reasonably good job at it. If I had to go to the area to cover something, I always knew that I could stop by KWIX if I needed to feed something back to the station in Columbia. They were well-equipped and had foreign-exchange phone lines just about everywhere in the region. They even tried to sell into Columbia and sometimes succeeded, especially with St. Louis Cardinals baseball on the FM, which meant direct competition with the station I worked for. But we were able to cooperate anyway. Yes, they sold, and sold hard, but also viewed themselves as providing a service to their listeners, and backed that up. They were good folks.
Edit to add a classic Jerrell Shepherd story, which I heard him tell.
A Chicago advertising agency called him up, wanting to buy time on morning drive.
Shepherd's response: "Do you want 8:01 or 8:02?"
The point being, of course, that he knew his market.
Shepherd replicated the formula with other stations in Missouri - first in Bethany, near the Iowa line; then south of St. Louis in the Farmington area, then elsewhere. But the Moberly stations were always the most successful. Alpha has them now, and you can still hear remnants of the Shepherd culture on the stations.
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