I earn most of my income from the radio industry. It's the form of advertising that I have had the most first hand experience.
I also know that there are multiple ways to advertise and you should be aware of what each advertising mediums strengths and weakness are and do an "appropriate" campaign based on:
- Your Business Now and in the Future
- Your Business History
- Your marketplace including competition for your customers money.
- What you are wanting to accomplish.
- And finally, how the advertising medium can produce the results.
The headline is that Radio revenues are down 7%. Digging further you may see the line about "at least we're not as bad as the newspapers."
Those words are being spoken by the big conglomerates. When you have a company like Clear Channel that was allowed to take over station after station and try and cut costs, and simply use local media as a cog in a big money making machine and strip the local content out of the product, then you are not playing to the strength of any local media.
Local Newspapers, Local Television, Local Radio can all survive and thrive if they are relevant to their local community.
It is no different than the local, hometown restaurant vs. the chain. Or Walmart vs. all the local businesses.
You have to give the local people an honest to goodness, real reason to do business with you, that is based on the customers needs and wants and you can survive and thrive.
Okay, enough of my Friday Lunch time rant. Here's the story that kicked it off:
Radio Dips 7% for First Half of '08
Even factoring in a robust 12 percent growth in off-air advertising and a 3 percent climb for network radio, radio advertising is still down 5 percent to $9.9 billion at mid-year
Aug 21, 2008
Even factoring in a robust 12 percent growth in off-air advertising to $889 million and a healthy 3 percent climb for network radio to $567 million, radio advertising is still down 5 percent to $9.9 billion at mid-year.
Radio continues to be hit by a very soft national ad market with national spot dropping 11 percent in second quarter and staying there. For the first half of the year, national spot is down 11 percent to $1.4 billion.
Local advertising was only slightly better, down 7 percent in second quarter to $3.8 billion, and down 6 percent to nearly $7 billion for the first half of the year.
While off-air advertising can't make up the difference, it's additional revenue the industry is clinging to in this tough ad market. According to the RAB, radio off-air revenue is "exceeding expectations," increasing at a compound annual growth rate of 12.3 percent over the past two years. The RAB has forecast off-air revenue, made up primarily of online activity, to pass $2 billion in 2009.
What radio can do to turn around its fortunes is a popular topic among Wall Street and other observers. In a report released earlier this week, Jim Boyle, an analyst with CL King & Associates accused radio of doing little to reverse the negative trends.
"The industry's larger groups do not appear ready to institute revolutionary changes yet in sales, programming, promotion or station clusters. There is a notable sense of denial of how harsh the prospects have been and continue to be for radio. The classic CEO reply is radio is not bleeding as badly as newspapers," Boyle wrote.
The RAB's figures are based on pool of more than 100 markets as reported by the accounting firm of Miller, Kaplan, Arase & Co.
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