National radio revenue rose 11% in May compared to a year ago, with a 1% increase in local revenues. For the year, local is flat and national is up 4% for a combined 1% increase. This compares with 2001, when revenue dropped 7.5% for the year, with network, national spot and local retail revenue combining for $18.3 billion. Top product categories include auto, communications, pharmaceutical and entertainment. Listenership and time spent listening are high, too.
The brighter picture isn’t any surprise to radio executives, who say radio isn’t as subjective to the ups and downs of the economy.
“I pin the success of radio on its relationship with the consumer,” said Gary Fries, president/CEO of the Radio Advertising Bureau. “It’s the closest media that exists to the lifestyle of the consumer.” He said there’s a radio format for everyone in the market.
“Every format is doing well, with no major format doing better than others,” he said.
There’s also a wave of innovation in advertising sales that hasn’t been there before.
“Large groups are selling clusters of stations across formats in most markets,” said Scott Musgrave, general manager of Arbitron Radio. “They put together multi formats to bring more options to advertisers in a way that is more cost effective.” He pointed to what Clear Channel, Viacom/Infinity and Greater Media are doing. Many stations remain sold individually but they’re being sold individually in clusters across all formats.
Musgrave said it’s the targeting that helps advertisers.
“Radio also gives advertisers the ability to target narrowly,” he said. “Not just age and sex like other media, but more psychographic, based on listener type. It helps advertisers with less money to spend to target more closely.”