• by Jack Loechner , Staff Writer @mp_research, June 15, 2007

Communications Radio Advertisers Show Biggest Growth in 1stQ 2007

The Radio Advertising Bureau, in the recent release of 1st Quarter 2007 revenue data based on a pool of more than 150 markets, concludes that non-spot activity presents a significant growth opportunity for Radio to increase its revenue stream.  Unmeasured prior to 2004, this category is 6.4% of total Radio revenue and is an important factor in Radio's total ad spend, impacting the medium into the positive growth position it displayed in 1^st Quarter 2007.

Local revenue, comprising over two-thirds of total Radio revenue in 1^st Quarter 2007, showed a 1% increase.  While national, representing one-fifth of total Radio revenue, was off slightly (-1%), non-spot and network both showed healthy increases - 10% and 9%, respectively - to offset the national drop and bring Radio's total revenue growth in at 1% over the same period last year.

1st Quarter 2007 vs. 1st Quarter 2006(In millions)
Revenue	Dollars (Mil)	% Chg
Local Revenue	$   3,224	1%
National Revenue	$      945	-1%
Network Revenue	$      257	9%
Non-Spot Revenue	$      302	10%
Grand Total Revenue	$   4,728	1%
Source: Miller, Kaplan, Arase & Co.

 In the radio's leading growth categories, the Communications sector spending is up an impressive 17.3% in Q1 '07 compared to same period '06, representing a rebound from Q1 '06 vs. Q1 ‘05. Three dominant players in this category comprise nearly three-quarters of total Radio ad spend, and collectively spent 25% more than in 1st Quarter 2006. This outpaces the overall category increase of 17.3%.

• AT&T/Cingular,
• Verizon Wireless
• SprintNextel

 Radio continues to enjoy robust gains in spending in the Health Care sector, posting a 9.5% Q1 gain for the second year straight. Eye care centers/services represent four of the top six spenders in the Health Care category:

• TLC Laser Eye Center
• Booth Eye Center
• LCA Vision
• Quest Diagnostics
• Lasik Plus
• Britesmile

While the Concerts/Theater/Movies category was up 17.3% in Q1 over and above ‘06's 12.1% increase, spending among the top eleven advertisers outpaced the category, growing collectively at 40%. These accounts represent 59% of total category dollars for the quarter -- and movies comprise 84% of that group. Major increases in movie spending in Q1 '07 came from

• Miramax Films (up 944%)
• Paramount Pictures (up 589%)
• Sony Pictures (up 229%)

RADIO'S LEADING GROWTH CATEGORIES(1st Quarter 2007 vs. 1st Quarter 2006)
Category	Q1 '07-Q1 '06	Q1 '06-Q1 '05
Communications/cellular/ public utilities	17.3%	-6.2%
Concerts/theater/movies	17.3%	12.1%
Health care	9.5%	9.5%
Source: Miller, Kaplan, Arase & Co.: X-Ray Markets

Automotive, Radio's leading advertising category, spent more than double that of the #2 category, Communications. The top 25 automotive Radio advertisers were up nearly 2%. Among this group, dealer dollars increased 7.7% over 2006, while manufacturer dollars were down 4.2%.

RADIO'S BIGGEST CATEGORY(1st Quarter 2007 vs. 1st Quarter 2006)
Category	Q1 '07-Q1 '06	Q1 '06-Q1 '05
Auto dlrs/dlr grps/ manufacturers/rentals	-2.6%	-10.0%
Source: Miller, Kaplan, Arase & Co.: X-Ray Markets

 

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