• by Jack Loechner , Staff Writer @mp_research, November 29, 2010

Building on strong first and second quarters, Radio continued its upward trajectory in Q3, maintaining its year-long 6% growth rate. 

Revenue Comparisons - 2010 vs. 2009 (In Millions)
Revenue	$Q3 '10	% Chg	$YTD '10	% Chg
Local	$2,970	3%	$8,464	3%
National	700	10%	1,970	14%
Local & National Combined	3,670	5%	10,434	5%
Network	271	4%	805	3%
Digital	163	23%	443	22%
Off-Air	355	5%	1,016	2%
Grand Total	4,459	5%	12,698	6%
Source: Miller, Kaplan, Arase & Co, November 2010

Jeff Haley, RAB President and CEO, says that "... Radio has generated steady momentum throughout 2010... advertisers in Radio's top five reporting categories are up 19% collectively year to date through September - $770M over 2009 comps."

2010 Leading Growth Categories Local and National Radio (in Millions)
Category	$Q3 '10	% Chg	$YTD '10	% Chg
Communications/Cellular	$380.6	6%	$1199.6	10%
Auto Dealers/Dealer Groups/Manufacturers/Rentals	365.9	19%	1178.9	24%
Financial Services	335.5	32%	952.8	28%
Television/Networks/Cable Providers	325.7	18%	915.1	16%
Grocery/Convenience/Liquor Stores	210.7	6%	686.1	16%
Department/Discount Stores & Shopping Centers	188.6	34%	440.0	17%
Professional Services	71.1	25%	401.1	16%
Source: Miller, Kaplan, Arase & Co., November 2010

The four top Radio categories all registered spending well above the $300M level in Q3, and the top two (Communication and Automotive) are already above the $1B mark for the year to date through September - with Financial Services and TV/Networks/Cable Providers all imminently poised to move up to that level. Radio also received a major cash infusion from political advertisers in the final throes of this year's competitive mid-term elections.

Radio's #1 advertising category, Communications/Cellular,continues to ring up gains, posting comp revenue increases of 6% and 10% for Q3 and YTD, respectively. The category is powered by Radio's two top spenders, AT&T and Verizon Wireless, both of whom maintain top ranking for the quarter and 9-month period despite relatively flat spending. Other key players are:

• MetroPCS, up 19% to $32.4M in Q3; up 13% to $96.7M YTD
•  ISP Clearwire, up 308%, to $32.4M in Q3; up nearly six-fold to $50M YTD
• Palm, Inc., up 235% to $11.2M in Q3; and up from just $3.3M to $45.6M YTD

Automotive has now given Radio four consecutive "up" quarters in the Local/National sectors. Expenditures through the first three quarters are 24% ahead of the comparable 2009 level; and the category ranks a solid second overall, just $20M behind Communications.

With most automotive advertisers significantly increasing Radio ad spend, it's important to note that Toyota Dealer Association is the category's leading spender in the quarter and pulling ahead to take a commanding lead in YTD. Leading Automotive advertisers based on year-to-date rank are:

Automotive 2010 vs. 2009 Local and National Radio (in Millions)
Advertiser	$Q3 '10	% Chg	$YTD	'10 % Chg
Toyota Dealer Association	43.0	56%	107.3	80%
Chrysler Group LLC	12.1	71%	80.3	307%
Nissan Dealer Association	12.1	32%	58.4	72%
Honda Dealer Association	23.8	13%	54.6	29%
Ford Dealer Association	22.8	58%	44.6	-2%
Lexus Dealer Association	13.3	16%	40.7	161%
Source: Miller, Kaplan, Arase & Co., November 2010

Financial Services advertisers provided an economic stimulus on Local/National Radio in Q3 (+32%) and the first three quarters (+28%), making this the biggest growth sector both periods. American Express has charged into Radio in a big way in 2010: Q3 '10 spending ballooned to $41M from $2M in Q3 '09, boosting spending for the three quarters to $85M, compared to $4M in '09. American Express is currently the #2 spender in the Financial Services category.

Retail, Including Home Improvement, Department & Discount Stores, continues to maintain its important role within Radio's revenue. Retail's percent increase has maintained its trajectory since Q1 within many retail subcategories.

• Walmart maintains its #1 position in spending within the Department/Discount Stores sub-category across the Local/National airwaves, up 95% for the first three quarters of the year
• Kohl's continues to invest their ad dollars into Radio, up 61%for the 1^st three quarters
• Lowes Cos. and Home Depot continue to alternate as leaders within the Home Improvement subcategory. Lowes took the lead for the quarter; but for year to date through September, Home Depot was the clear leader at nearly $80M
• And, across the Network Radio sector, Retail is the #1 category, with Home Depot's continued trend as ad spend leader for the quarter and year to date, while AutoZone increased its Network Radio activity 19% for the quarter

Spending by food retailers has been increasingly aggressive over the last four quarters as they attempt to tap budget-conscious consumers' move toward eating more at home. The category is up 10.8% over Q3 '09 and up 15.3% over three quarters 2009 comps.

Grocery/Convenience/Liquor Stores 2010 vs. 2009 Local and National Radio (in Millions)
Advertiser	$Q3 '10	% Chg	$YTD '10	% Chg
Kroger Food Stores	31.1	12%	90.3	10%
Supervalu	25.2	11%	63.1	15%
Source: Miller, Kaplan, Arase & Co., November 2010

TV's fall season kickoff combined with ongoing promotional efforts by Comcast generated an 18% Q3 revenue boost for Local/National Radio in comparison with the same time period last year, bringing the three-quarter' YTD increase in at 16%.

The top five spenders for the quarter were

• Comcast Cable - $78.9M
• Fox TV Network - $45.2M
• CBS TV Network -$31.2M
• NBC TV Network -$30.6M

ESPN -$20M

For year to date spending,

Comcast and Fox lead at $199.5M and $115.3M respectively

• NBC TV Network at $65.6M
• CBS TV Network at $58.8M
• ABC TV Network at $46.1M
•  ESPN ranks 7th at $29.7M

As Local and National Radio's 9th ranked category for the quarter, insurance spending increases remain steady from Q2 2010.

2010 vs. 2009 Local and National Radio (in Millions)
Advertiser	$Q3 '10	% Chg	$YTD '10	% Chg
Allstate	28.1	108%	38.5	58%
State Farm	13.3	28%	52.6	50%
Progressive	11.5	81%	34.5	140%
Source: Miller, Kaplan, Arase & Co., November 2010

Companies offering services ranging from financial planning to lawyer referral services to singles travel excursions are increasing their ad spend across Radio's Local and National sectors with year over year increases of 16% year to date through September 2010.

In the medical category, Kaiser Permanente maintains its top ranked spending position within the Local and National Radio sectors. In addition, the medical category has expanded to include beauty and wellness centers. Appearance enhancement businesses continue to grow as consumers seek new and easy ways to improve their appearance.

By the end of September, year to date Political ad spend totaled $51.3M within the Miller Kaplan markets. 50% of year to date spending within the category was led by campaigns of political candidates, and dominated

Local and National Advertiser Category analysis is based on data from Miller, Kaplan, Arase & Co. X-Ray Market Reports. Network Radio Advertiser Category spending analysis is based on data from Kantar Media (formerly TNS Media). 

For more from RAB Marketing, including the PDF file, please visit here.