Radio advertising would be impossible without the radio. Radio waves were discovered and studied by Heinrich Hertz in 1867 (Schoenherr, 2001). Guglielmo Marconi invented a transmitter in 1894 and formed the first wireless telegraph and signal company in 1897 (Schoenherr, 2001). Reginald Fessenden of Canada invented the continuous-wave voice transmitter and sold it to Westinghouse in 1910. Several amateurs began to broadcast information from music to news over the airwaves as soon as crystal radio receivers became available from 1912 to 1921 (Schoenherr, 2001). Because of the Titanic disaster, all ships were required to have radios and radio operators on board. RCA started in 1919 to mass produce radios (Schoenherr, 2001). NBC was founded in 1926 and produced a 47 station network by 1928.
Today, television has the broadest audience, radio is more regional and newspapers are the most local. Radio advertising offers businesses advantages over other media. It reaches a large audience, with high target ability and low cost. Radio advertising is significantly lower in cost than television advertising. A television ad can cost $50,000 to produce. A similar radio ad will cost closer to $1,500 (“Direct Response Radio,” n.d.). A typical radio 60 second radio spot can cost $100. A 60 second television Commercial will likely cost $100,000. 13,000 radio stations in the United States reach 94% of the population over 12 years of age each week (“Direct Response Radio,” n.d.). Radio has greater target ability depending on the programs. Some types of music are more popular with teens and others more popular with people over 60. There are programs that target women, Hispanic listeners or adults 35 to 44 years of age. Radio advertising has the ability to drive online traffic to support sales. Finally, statistically speaking, radio listeners spend more per purchase than TV infomercial buyers ($148 vs. $98) on average (“Direct Response Radio,” n.d.).
Two different economic systems have been tried in the world during the twentieth century. The command economy and the market economy have both been tried by different nations in the world. A command economy is basically socialism where the government owns everything, producing and distributing goods and services by central planning (Perreault, Cannon, McCarthy, p.12). Market economies consistently outperformed command economies. Distribution and production are determined by millions of people buying goods and services desired. The market tries to satisfy the customer in exchange for a profit. Market economies are now recognized as the most desirable. Market economies have certain characteristics in common. First is private ownership with protected property rights. The market exchange has flexible prices that attempt to reflect the fundamentals of supply and demand. Market incentives include both rewards and penalties where the value of goods and services are worth the price or not. There is a monetary system that functions to make voluntary exchange possible. Finally there is trust in the market where goods and services can be assumed to be of value as advertised.
Market economies are natural developments that evolve wherever people exchange goods and services (Perreault et. al., p.12). Socialist economies are formed by government institutions. The first market economies used barter as a means of exchange where one person made a pair of shoes and exchanged those shoes for a spear made by someone else. Barter has limitations. It is impossible to trade 1,000 pairs of shoes to a car maker for a car because the carmaker does not want or need 1,000 pairs of shoes. A middle man can buy large lots of shoes and resell them to many stores for a profit. The shoe maker and the middleman can then afford to buy a car when there is money involved in the exchange. Companies can manufacture goods in hopes of selling those products but most companies hire salespeople. It is the job of salespersons to...
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