The savants who read radio’s revenue tea leaves have a fresh set of cups to peer into.
The spot component — U.S. commercial radio’s largest source of money — continues to be sluggish; it was down slightly in the last three months compared to the same period a year earlier, according to the Radio Advertising Bureau.
But radio revenue overall increased for the sixth consecutive quarter, up 1% overall, again led by increases in digital/online sales, which were up 18%. Off-air was up 5%, network revenue was up 3%.
At the midpoint of 2011, overall radio revenue was up 2%. Within that, spot was flat, network was up 2%, digital was up 19% and off-air was up 7%. RAB believes the industry brought in $8.4 billion in the first half.
Finishing the half in positive territory is relatively good news, compared to some quarters in the not-distant past. If the 2% pace holds, radio will finish the year at about $17.6 billion.
But 2% performance is off the 6% growth pace of last year. More worrisome perhaps is the likely effect of current stock market turmoil and negative economic talk on radio’s second half. The industry has some outperforming to do if it is to surpass last year’s year-end growth.
RAB head Jeff Haley, though, stated in the announcement, “Contrary to what you might think regarding recent market woes, many of the nation’s largest marketers are forecasting increases in media expenditures through the end of 2011. Companies like P&G, AT&T and Coca-Cola have all reported upcoming campaign support for various products and Fiat is reintroducing its vehicles to the U.S. — all which could mean more revenue for radio.”
Radio’s biggest spot advertisers in the quarter, by revenue, were Comcast Cable, McDonald’s and AT&T.