Radio revenues continue to decline but experts seem optimistic

A campaign rich in radio can increase the reach and frequency of the message despite what the economic plight of the medium itself.

According to MediaPost, radio ad revenues have declined 16% during third quarter 2009. This is compared to revenues from third quarter 2008. With this outcome, it marks the 10th straight quarter in radio ad revenues to see a yearly decline. However, despite the decline, the Radio Advertising Bureau (RAB) stated that this can be a positive sign of a recovery economic climate.

The reasoning for the optimism lies with the speed in which the revenues descend has slowed since first and second quarters of this year. In fact, the first quarter of 2009 saw revenues fall 24% and second quarter fell 22%.

Another factor involving the RAB’s bright outlook involves the digital evolution of radio and its growth. While digital only contributes roughly 3% for the radios bottom line in percentage forms, it has continuously grown throughout the year. The total digital revenues for the year-to-date through September have increased to $347 million compared to last year.

Local online advertising also has potential to aid in increasing radio’s ad revenues. The pressure point regarding online is that radio broadcasters will need to increase the investment in online platforms to keep the content relevant to the listener. This can be difficult to accomplish due to station cut backs based on the recession.

While ad revenues may be decreasing for radio, it is still important to remember that there is still a captive audience that can be reached through this medium.

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