Los Angeles Is the No. 1 Hit on Radio Advertising Charts

When FM rock station KQLZ, known as Pirate Radio, broadcast ads recently for a Los Angeles ticket scalping agency, it received angry complaints from a few listeners.

The ads were quickly killed. “Why accept a commercial if it’s going to irritate your listeners?” posed Scott Shannon, the station’s program director and drive time disc jockey. “If you’re just doing it for the money, that’s like prostitution.”

Los Angeles is one of the few radio markets in the country where many advertisers are so eager to purchase air time that some stations can afford to pick and choose their sponsors. Besides the ticket scalpers it rejected, KQLZ routinely turns down a number of those fast-talking spots from auto insurance companies. The station airs only four commercials an hour, some at a charge of up to $1,500.

“Los Angeles is undeniably the healthiest radio market in the U.S. today,” said Lynn Anderson, president and general manager of one of the top-rated FM radio stations, KIIS, which charges up to $2,000 for some one-minute commercials. “It has experienced unprecedented growth for the past six to eight years. And I see nothing that indicates that won’t continue.”

Now there’s evidence that this growth will not only continue but also accelerate throughout the 1990s. A new study of Los Angeles radio advertisers spells out just how big the radio market has grown in the area--and just who the big-time advertisers are here.

The findings project that 1989 radio advertising revenues in the Los Angeles area could surpass $400 million. The study of more than 800 advertisers is the first commissioned in the radio industry. Although such studies have long been available for television and print advertising, they have not been done on radio spending until now.

“Radio is the Rodney Dangerfield of media,” said Gordon Mason, president of the Southern California Broadcasters Assn., which commissioned the new quarterly survey compiled by the North Hollywood accounting firm of Miller, Kaplan, Arase & Co. “But in Los Angeles, the average person listens to radio at least four hours a day. Here, a lot of people look at radio like it’s a friend.”

And the best friend of Los Angeles radio for the first nine months of 1989 was Anheuser-Busch Inc., which spent more than $4.2 million on radio ads in the Southland for its beer brands, according to George Nadel Rivin, an accountant with the firm that compiled the study. During the same period, Lucky Stores ranked second, spending upward of $3 million; GTE placed third by investing more than $2.8 million.

“Radio advertising fits the life style in Southern California,” said Chuck Fruit, vice president of corporate media at Anheuser-Busch in St. Louis. “People in Los Angeles seem to always be outdoors--maybe listening to their radios at the beaches. Of course, that’s not the case in most cities like, say, St. Louis, where it’s 15 degrees below zero. “

The bulk of Anheuser-Busch’s radio spending in Los Angeles is pegged toward sponsorship of professional sports teams--the Dodgers, Angels, Rams, Raiders, Lakers, Clippers and Kings. Anheuser-Busch also uses radio to target minority audiences.

Meanwhile, Lucky says it spends more than any other Los Angeles supermarket on radio advertising for one reason. “A whole lot of people spend a whole lot of time in their cars in Southern California,” said Judy Decker, communications manager for Lucky Stores Inc. “Radio allows us to concentrate on quickly promoting special prices on items.”

But unlike most cities, where food and beverage companies are the biggest radio advertisers, the largest advertising category in Los Angeles is auto dealers and manufacturers. In fact, the broadcasters association estimates that 13.3% of all radio advertising in Los Angeles is purchased by auto-related companies.

Demand for radio time by car makers--and other advertisers--has helped bolster the value of local radio stations by many millions of dollars. Recently, KJOI sold for $79 million, quite a leap from the $18.5 million it was purchased for in 1984.

Price tags like that, however, are placing enormous pressures on stations to rank near the top in the ratings. “The cost of being in the radio business in Los Angeles has escalated incredibly,” KIIS’ Anderson said. “There is a heavy price to pay for playing in L.A.”

Although the Los Angeles radio market may be enjoying a heyday, executives in the New York market say not to count them out. “There is a general perception that Los Angeles is a hotter radio market than New York,” said Maurie Webster, president of the trade group New York Market Radio Broadcasters Assn. “But if you take all the people in New York who listen to radio during morning drive time and subtracted from that all the people from Los Angeles who do the same, the number left over is slightly larger than the population of Detroit.”

To get that point across, the New York radio trade group recently ran an ad in the monthly newsletter published by the Los Angeles broadcasters group. The ad tried to convince advertisers that the New York radio market “outperforms” the Los Angeles market.

But the radio rivals in Los Angeles laugh at all this. “New York may be No. 1 in population,” responds Mason, “but where it counts--in the bankbook--we’re still No. 1.”

Agency Tastes Success, Lands Second Account

Here’s one agency that ended its yearlong business drought appropriately--it landed a mineral water account.

Campbell & Wagman Inc., the 3-year-old Los Angeles firm that has relied almost exclusively on First Interstate Bancorp for its business, last week won the estimated $3-million to $5-million Vittel Imports account.

“For us to be successful in the long run, we know we can’t be reliant on a single client,” said Craig Campbell, president of Campbell & Wagman. About this time last year, the agency lost the $22-million Marshall’s Department Store business. That left it with just one client besides First Interstate--Sundale Beverages, a maker of fruit juices for children.

Vittel--one of the largest producers of bottled water in the world--is a latecomer to the $3-billion U.S. bottled water market. Vittel Imports, which recently moved its North American headquarters to Newport Beach, is up against such giants as Perrier and Evian.

The Vittel campaign, expected to break in February, will likely focus on the health benefits and good taste of the water, Campbell said. And he hopes his agency can use this win of Nestle-owned Vittel as a springboard for picking up more packaged goods clients.

How did the agency celebrate the win? Said Campbell, “We closed down the switchboard and served Vittel to everyone.”

Giveaway Assures That Aspen Smells of Aspen

If you know any men living in Aspen, chances are they’re smelling spiffy today.

Last week, virtually every man living in that city--about 4,000 or so--was mailed a $14 bottle of cologne from the maker of a new men’s fragrance named, you guessed it, Aspen.

Behind this pungent promotion is Chicago-based Quintessence Inc., which also makes such fragrances as Jovan and Dare.

Why did the fragrance company play Santa Claus? “The fact is, it’s named Aspen,” said Greta DeBofsky, vice president of public relations at Quintessence. “We at least wanted the people of Aspen to know about it.”

Ad Campaign Has Even a Stone-Face Smiling

First, there was the Prudential rock. Now, along comes the HomeFed Bank stone.

To be precise: stone statues. And to be more precise: three giant statues that look like stone but are actually made from masonry.

These colossal statues will soon appear on a TV screen near you. Behind it all is a $10-million campaign for the newly renamed thrift’s adjustable certificate of deposit, which, as the commercials painstakingly point out, are not “carved in stone.”

If a saver buys a nine-month CD at HomeFed and the S&L; offers a better rate during that period, he or she may ask HomeFed to bump up its rate. The Los Angeles agency behind the campaign is Rubin Postaer & Associates, which also creates ads for Honda. The 14-foot stone statues were created by a special effects firm in Pasadena.

In the TV spot, one statue even appears to smile--a stunt accomplished by two men hidden inside the statue who stretch its rubberized lips, said Larry Postaer, co-founder of Rubin Postaer. The figures are modeled after those found in the Easter Islands in the Pacific Ocean.

Of course, the ads weren’t filmed in the Easter Islands, but in Simi Valley. And the crew gave the three statues nicknames--Manny, Moe and Jack--after those familiar Pep Boys TV spots.

Wondering which one is the smiling statue? Moe, of course.

L.A. RADIO’S MILLION-DOLLAR CLUB

Amount spent by various advertisers in first nine months of 1989.

Number of Rank Advertiser stations $ Millions 1) Anheuser-Busch 10 4.175 2) Lucky Stores 19 3.017 3) GTE 11 2.839 4) Southern California Chevrolet Dealers 11 2.330 5) California State Lottery 17 2.077 6) Broadway 19 2.061 7) Ralphs 18 2.031 8) Pacific Bell 14 1.842 9) 7-11 Stores 10 1.829 10) Pepsi Cola 10 1.736 11) Pac Tel 11 1.714 12) Miller Brewing 5 1.674 13) Vons 17 1.660 14) Nutri/system 12 1.652 15) McDonald’s 12 1.650 16) Thrifty Drug 15 1.626 17) Coca-Cola 13 1.613 18) Carl’s Jr. 10 1.562 19) Southern California Ford Dealers 16 1.553 20) Sears 16 1.547

Source: Southern California Broadcasters Assn. Inc .