The radio business suffered a 2% drop in overall Q4 revenue, the blame for which can be laid entirely at the doorstep of the spot business, which was the only down category among the four tracked by the Radio Advertising Bureau and Miller, Kaplan, Arase & Co. But radio stations were still able to record an increase in year-over-year income.
The spot advertising take in Q4 2011 was $3.6B, 4% less than was banked during Q4 2010. Spot is the dominant source of radio income, so the positive numbers registered in the other three categories – network (+5), digital (+8) and off-air (+6) – was not enough to pull the quarter into positive territory.
Positive non-spot revenue was enough to overcome 1% drop in spot for the year, to $14.06B. Total revenue gained 1% to $17.4B, with a double digit gain in digital grabbing the year-over-year headlines at +15%. Unfortunately, it is still the smallest category in terms of volume, muting its ability to affect percentages.
RAB noted that 2011 was the second consecutive growth year, and even though the total gain year-over-year was relatively small, radio was able to hold onto significant gains since 2009, when the total take was only $16B.
|Source: RAB, Miller Kaplan Arase & Co.|
Jeff Haley, RAB President and CEO, “The diversity of Radio’s revenue mix helped our industry achieve a second consecutive year of growth since rebounding from the recession. Spending across Radio’s top five categories has been consistent since 2007 and contributed greatly to Radio’s revenue performance. Further, while Automotive remains dominant, the categories ranked #2 to #5 have grown closer to each other compared to 2007 levels and now represent a larger percent of the overall pie.”
RAB noted that automotive remains the industry’s biggest customer, accounting for 26% of revenues. Communications, restaurants and TV/networks/cable kicked in 19% each, and financial rounded out the top five at 17%.
The top 10 radio clients:
RBR-TVBR observation: Although the election year advertising bump is not nearly as pronounced in the radio biz as it is for television operators, it will help. The economy, which seems to finally be demonstrating some vitality, should help more. We would like to see radio drive a healthy increase in the national demand for black ink this year.