Whether we are in a recession or not may not matter. Cox Radio CEO Bob Neil told analysts, “The facts are, in a recent poll 70% of consumers said they believed the economy was in a recession. Radio’s biggest customers have historically been consumer-driven – autos, real estate, retail, home improvement, banking – and all of those industries are ailing. And as long as they are, every ad-supported medium is going to suffer,” Neil said. He noted that radio, by comparison, is not hurting as badly as newspapers and television (excluding political), which are down more than radio year to date. “And even local cable sales continue to be down,” he added.
The solution at Cox is to create its own marketplace, rather than simply reacting to the existing marketplace, Neil told analysts. So the company has been refocusing its sales efforts to go after advertisers who have not traditionally used radio. The benefits, he said, are pricing based on solutions and results, relationships with advertisers “and a more predictable revenue base.” There’s not much Cox can do about national business. That up to its national rep, he noted. So, the solution is to focus on new local business. “We think we’ve got the finest sales team in the industry and I have no doubt they’re up to the task,” Neil said.
Although Q2 revenues were down 8%, the markets where Cox Radio’s stations are located were down 9%. Neil noted that while total sales are pacing down in the mid single digit range for July, local sales are up about 2%.