Katz: National Radio Ads Jump 17%

The radio business got some more good news Tuesday with a memo from Katz Media Group CEO Stu Olds: National advertising sales are growing again in the second quarter of 2010 -- making it the second quarter to see year-over-year growth after one of the longest and steepest slumps in U.S. history.

If current trends hold steady, Olds says total revenues are pacing to grow 17% in the second quarter, compared to the same period last year -- thanks to consecutive year-over-year increases of 10%, 17% and 27% in April, May and June.

Growth was led by telecom, professional services, consumer products and retail -- which all saw even bigger percentage increases than in the first quarter, according to Olds, who also noted sustained growth in automobile advertising.

Retail is up 31.2% compared to the second quarter of 2009, telecoms 52.5%, consumer products 33.6%, professional services 38.7% and autos 29.9%. That compares to first-quarter increases of 0.6%, 21.9%, 31.2%, 14.6%, and 33.2% in the same categories, respectively.



Not every category was up: entertainment and financial services both saw ad spending decrease in the second quarter (dropping 11.9% and 16.6%, respectively). The decrease in financial-services advertising may partly reflect the end of the Federal stimulus program to bolster the mortgage market, which expired in April.

The second-quarter growth is spread across virtually every major market, with 20 out of 25 top DMAs experiencing double-digit percentage increases, according to Katz. Boston is up 50%, Houston 38%, Miami 34%, Washington, D.C. 31%, Pittsburgh 30%, Philadelphia 27%, Tampa 26%, Baltimore 23%, Seattle 28%, St. Louis 23%, Dallas 21%, Denver 20% and New York 20%.

These are heartening figures for the radio business, which experienced unprecedented declines over the two years -- but they only cover national advertising revenues, which usually represent about 15% of total radio ad revenues.

Beginning in the second quarter of 2007, the radio business as a whole experienced 11 straight quarters of declines through the end of 2009, and most of these losses were in local advertising -- the traditional mainstay of the medium.

A real recovery will depend at least as much on local as national advertising.

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