The drop was due to weakness in spot and network advertising, the two traditional mainstays of the radio business, offset somewhat by increases in digital and off-air revenues. Spot advertising fell 3% from $3.68 billion in the third quarter of 2013 to $3.57 billion in the third quarter of 2014, while network slid 4% from $275 million to $264 million over the same period.
On the positive side, digital revenues jumped 11% from $244 million to $271 million, and off-air revenues rose 14% from $401 million to $459 million.
The weak third-quarter performance follows a flat first half of the year, leaving total revenues for the first three quarters down 1% compared to the same period last year, to $12.9 billion.
It’s worth noting that the third quarter marked the first time in radio history that digital eclipsed network ad revenues. However, digital remains a fairly small part of the overall business, at 5.9% of total revenues.
Although the overall figure was down, a number of categories did show growth in the third quarter, including health care advertising, up 4%; professional services, up 5%; and insurance companies, up 1%. Smaller categories experiencing growth included home improvement, up 6%; real estate and retirement communities, up 15%; transportation, up 32%; and postal and delivery services, up 59%.
The top advertisers in the quarter were Comcast Xfinity, AT&T, T-Mobile, McDonald’s, Geico, PepsiCo, Sprint, Toyota Dealers Association, Allstate, and Safeway.