Radio revenue continues to remain healthy in local sales, with overall improvement coming from outside of the top 15 markets. According to the latest announcement from the Radio Advertising Bureau, local sales figures for October fell 6% when compared to the same month a year ago, while national dollars were off 15% and the combined total was down 8%. From a year-to-date perspective, local figures were also off 4% during the first ten months of 2001 while national numbers fell 19% for a combined year-to-date total that was down 8%. “In looking at the revenues by markets, we find that the larger markets are the ones driving down the total revenue numbers,” observed Gary Fries, President and CEO of the RAB. “In the top 15 markets, year-to-date local is down 7%, national is off 24% for a year-to-date total of - 12%. After the top 15 markets, Radio is performing reasonably well.” To put the intermediate and long-term growth of the Radio industry into better perspective, RAB has introduced an index that equates base year 1998 to 100. The index works similar to the Gross Pricing Index so that the information can be monitored on a monthly basis. The RAB sales index for October came in at 110.2 for local, 102.5 for national yielding a combined total of 108.8. When looked at from a year-to-date perspective, the sales index for local is 126.9 while the national index is 114.0. The index for the combined year-to-date total is 125.0. Looking ahead, Fries stated, “Our first glimpse of November indicates improvement over last year, particularly in local sales, which continue to grow and strengthen. Radio will end this year down 8% in ad sales,” he predicted. “For 2002, I foresee national remaining flat while local rebounds to end the year up 4%. The combined total in Radio revenue for 2002 will be up 3%.”
Jupiter Media Metrix today reported that online travel advertising has soared in 2001, despite a major setback following the Sept. 11 terrorist attacks. According to data from Jupiter Media Metrix' AdRelevance service, online advertising for the travel industry began a sharp increase the second week of May 2001 with 291.9 million impressions and peaked in the fourth week of August with 1.1 billion impressions - a 263% increase. While impressions plummeted during the second week of September and bottomed out at 574.4 million during the first week of October, the industry has since returned to 94% of its pre-Sept. 11 levels. "The early 2001 launch of Orbitz.com put a surge into travel advertising, with the industry more than doubling between the spring and the end of summer," said Charles Buchwalter, VP of media research at JMM. "However, the industry took a major hit on Sept. 11, as travel companies halted advertising out of respect for the victims, as well as to promote disaster relief efforts. But the sector has showed incredible resiliency as booking services and airlines have turned to the Web to reach out to consumers during the busy holiday season." Among the top ten online travel advertisers - ranked according to their share of total travel impressions for the week ending Dec. 2, 2001 – four are online agencies, making up 64% of the market, and three are airlines, making up 6%. The top advertisers are: Orbitz with 44% of the travel market, Travelocity with 13% and Hotwire with 5%. Retail Advertising Sluggish in 2001 JMM reports that while most of this year's major online advertising growth-indices compare closely with those in 2000, the retail sector has been mixed and is now off to a slow start to the historically frenzied holiday period. So far this season, weekly online ad impressions for the retail sector have reached 3.7 billion in the fourth week of November, up eight% from 3.4 billion in the first week of October. This compares to last year's growth rate of 18% over the same period, when weekly impressions increased from 2.4 billion to 2.9 billion. Retail advertising last year eventually peaked in the fourth week of December at 3.7 billion impressions, up 53% from the first week of October. "This year's holiday ramp-up has yet to reach the growth trajectory of last year's," said Buchwalter. "Declines in consumer confidence resulting from the economic downturn as well as the Sept. 11 attacks may be responsible for the delayed increase in retail advertising. We'll be watching closely to see if the sector catches up in the final days of the holiday shopping season." Top Online Retail Advertisers Ranked According to Share of Industry Impressions 11/26/01 through 12/02/01 1 Amazon.com - 16% 2 Barnes & Noble Inc. - 11% 3 Columbia House - 10% 4 eBay Inc. - 9% 5 CMGI Inc. - 3% 6 Spiegel Publishing - 3% 7 1-800-FLOWERS.COM - 2% 8 Netflix - 2% 9 4HourWireless.com - 2% 10 Best Buy Co. Inc. - 2% Top Online Travel Advertisers Ranked According to Share of Industry Impressions 11/26/01 through 12/02/01 1 Orbitz - 44% 2 Travelocity - 13% 3 Hotwire - 5% 4 Vail Resorts Management Co. - 5% 5 AMR Corporation - 3% 6 Princess Cruises - 2% 7 British Airways - 2% 8 Priceline.com - 2% 9 Thrifty Car Rental - 2% 10 Lufthansa - 1%
Recently released data from Scarborough Research shows Americans are shopping more online, but not spending heavily. The company reports that 61% of American adults have Internet access, with 41% of its test group shopping on the Internet within the past year. Twenty-six percent spent at least $100 and 12% spent more than $500. "Online shopping has increased in popularity and they're spending more. But it's still a baby as to how comfortable they are," says Scarborough president Bob Cohen. "They don't buy much and don't spend large amounts online." Over 40% of the group shopped once, 35% made a purchase and 18% shopped ten or more times. Seven percent made ten or more purchases. Cohen sites "a big drop in regular shoppers." There is a distinction between shopping and purchasing because not all online shoppers make purchases. High-ticket items like jewelry and cars get high shopping numbers but not purchasing because shoppers use the Internet for research without intending to buy online, Cohen says. Shopping is the second most popular Internet activity, after email, the study reports. The top products for online shopping are books and airline tickets, each accounting for 29% of online purchases, followed by CDs/music and clothing, 21% each. These products sell well because they are "tangible, small ticket media items that don't require a lot of research and don't need to be touched before purchasing," Cohen says. Music sells well because it can be listened to online before purchasing. Airline tickets sell well because they can be bought online at lower prices. Scarborough studied online shopping locally, determining that it is highest in the cities with highest Internet penetration: San Diego, Seattle, Austin, TX, Washington DC and San Francisco. In San Francisco, 55% of the sample shopped online within the past year (compared with the national average of 41%); in Austin, 40% spent $100 (compared with the national average of 26%). When asked why Internet retailers should care about local numbers, since the Internet isn't a local medium, Cohen said, "If you're a marketer of Internet services it is important to understand that Internet access varies across local markets and some are more receptive to product offers." He also said different types of offline advertising that promotes online shopping, such as billboards and newspaper inserts, should be used in the markets with highest Internet penetration. The Scarborough research notes that Internet penetration has increased 8% from last year. Online shopping has increased 22%, Online purchasing has increased 21%. Spending $100 has increased 16%. And, spending over $500 has increased 7%.
Merrill Lynch expects the rollout of new digital cable TV boxes in U.S. homes for most cable operators to slow this quarter, and next year, as the share of households with access to digital cable approaches 30%. The pace of the rollout, which is important to cable TV operators who look to digital cable to boost subscriber revenue, is expected to slow by 15% in 2002 from 2001. The investment firm forecasts cable TV operators to add 10,900 digital subscribers per week in 2002 compared with its estimate of 13,000 new digital subscribers per week in 2001. Overall penetration of U.S. homes, which is now about 24% , is expected to rise to 29% by the end of 2002, according to the Merrill Research. The pace of digital rollouts is expected to be about 11,900 subscribers per week in the current, fourth quarter, down 9% from 14,800 per week in the third quarter and 40% from 21,300 per week in the fourth quarter last year. Merrill Lynch said new video-on-demand (VOD) services could boost the rollout, but added that the prospect for large deployments backed by huge marketing campaigns was unlikely. In the past two years, cable TV operators have been installing new digital cable TV set top boxes in homes in order to deliver new, enhanced services such as electronic program guides and VOD, for which they can charge additional fees.