Advertising on the Radio? Know These FCC Rules

By business.com editorial staff,
business.com writer
| Updated
Jun 22, 2020
Image Credit: Dmitri Ma/Shutterstock

Stay in compliance and reach customers with these tips.

  • Since more than 90% of all American households listen to the radio each week, this is a reliable platform to advertise on. This percentage is higher than smartphone and television use.
  • The FCC regulates all communications that go over the airwaves. Your ads must abide by all FCC rules to remain in compliance.
  • Violations of FCC radio regulations can result in cease and desist orders, along with fines in excess of $42,000.

Digital radio stations are a prime avenue for advertising. According to a 2017 Nielsen report on media, "Radio reaches more Americans each week than any other platform." In fact, more than 90% of the population listens to the radio on a weekly basis, which beats out television, smartphones, personal computers, television-connected devices and tablets.

What is the FCC?

The FCC or Federal Communications Commission is in charge of all communications that are made through radio, television, satellite, and cable. These communications can come from international or national sources. According to the FCC website, the agency is run by five commissioners, who are appointed directly by the president and then confirmed by the United States Senate. All rules made by the FCC in regards to international and national communications are made through a process called notice and comment. This allows the public to be involved in the process of choosing the rules for communications that are shared publicly. The FCC announces the potential rule and takes public comment into consideration before finalizing the regulation.

The FCC regulates what is acceptable when advertising on a platform like the radio. The FCC will regulate any type of content on the radio and take action if the ads violate their rules. For instance, the FCC does not allow any type of ads that could be considered obscene or profane.  

If you plan to advertise on a successful HD radio program or otherwise enter the digital audio broadcasting space, you should be familiar with the FCC's rules and guidelines on advertising. While there are also standards that govern the non-advertising content that is produced, this guide is exclusively about the unique standards that apply to paid advertisements, since compliance in that area is often highly scrutinized.

  1. Any station that broadcasts sponsored slots must disclose to listeners that the spot is sponsored and who it is sponsored by. The only exception to this rule is in a case where it is, as the FCC says, "clear that the mention of a product or service constitutes sponsorship identification." In other words, a radio personality can work your advertisement into their show without switching to a commercial break, but they need to make it obvious to listeners that the product or service they're plugging is a paid advertiser.

  2. Stations must be notified about new partnerships and planned sponsored content prior to the airing of such content. While this area of compliance falls primarily on the shoulders of the broadcaster and not the advertiser, it's important to know. If you're negotiating an advertising or sponsorship deal, ask about workflows and timelines for notifying up the chain of production and distribution, and when in doubt, start negotiations early (especially for seasonal or time-sensitive promotions).  

  3. The content laws for digital audio broadcasting are the same as those for television, and they extend to advertisements. Broadcast channels are prohibited from airing adverts for certain lotteries, cigarettes, cigarillos and other tobacco products as well as for any fraudulent product or service. Advertisements that are deemed obscene, indecent or profane are not allowed during certain hours, and some types of content may not be allowed at all. This guide explains what constitutes obscene, indecent and profane. Note that satellite radio is exempt from these restraints, as it is a subscription service.

  4. All advertisements aired on an HD radio channel must maintain compliance not only with the FCC but also with the FTC and the FDA. General FTC guidelines, like being truthful (and not deceptive) in advertising, apply to all industries, while others, like those pertaining to health claims and testimonials, are more product-specific. It is best practice for advertising firms to employ a compliance specialist, either in-house or on a contract basis, to ensure that money isn't wasted on noncompliant advertisements or sponsorships.

Radio compliance violations

Consumers are allowed to report your ads to the FCC if they feel it violates the rules in place. The exact violation depends on which agency handles the complaint. For instance, if listeners feel the ad is misleading, the report goes to the Federal Trade Commission or FTC. The actions taken for violations depend on the seriousness of the act. At first, a cease and desist order may be filed. Fines can range in excess of $42,000 depending on the nature of the violation, according to the FTC website. In some cases, refunds to customers impacted by the advertisements can be ordered.  

If you believe a broadcaster is acting unfairly or violating FCC protocol for advertising and sponsorship, you may report it here. Before you advertise on any broadcast channel, you should do your homework. Find out what other types of sponsorship and advertising relationships the broadcaster already has and what its process is for staying compliant with the FCC.

business.com editorial staff
business.com editorial staff
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