Local spot advertising allows the advertiser to reach a specific geographic audience because she is purchasing advertising space from individual radio stations. Local retailers or other businesses may especially benefit from this type of advertising because customers are more likely to purchase the advertised good or service if they live or work close to the product or service.
Advertisers that have many geographic locations may consider network advertising or national spot advertising to reach potential customers who are not all within the same geographic range. The opposite is also true--advertising who have only one or a few locations may not find network advertising to be as effective because, even if it does reach more people, fewer of them may be in a location to be ,potential customers.
Advertisers can potentially reach millions of listeners by purchasing ad times with a network, which will then play the ads on the numerous radio stations that it owns. However, there are few national networks from which advertisers can choose should they wish to purchase network advertisement time. On the other hand, there are more than 9,000 independent radio stations within the United States. This provides advertisers with more options when it comes to choosing stations with which to work.
National spot advertising can also connect advertisers with their target audience when the advertisement plays during a specific program, such as a music countdown, debate or radio talk show. Advertisers who wish to place national spot ads will need to contact the program or syndication itself, rather than the network or a specific radio station that hosts the show.
Individual radio stations or syndications stand to benefit more from spot advertising as it attracts the majority of all yearly advertising revenue. Thomas O'Guinn, Chris Allen and Richard J. Semenik write in the book "Advertising and Integrated Brand Promotion," that 80 percent of all yearly advertising dollars go to spot advertising rather than network advertising. However, networks may charge higher fees for advertising because they own more properties.
Both spot and network advertising cannot accurately measure the effectiveness of advertising via the radio, especially because many listeners tune in when outside the home. Professor Hershey H. Friedman of The City University of New York states that traditional, diary-style research methods, such as those used by television researchers, are less effective because of this.