CHANTILLY, Va. (Dec. 2, 2009) – Radio stations across the country were battered by the economy this year, with the scars revealing the industry will end 2009 with revenues of $13.3 billion, a 19 percent decrease from last year, according to BIA/Kelsey’s third edition of its quarterly
Investing In Radio® Market Report. Recovery will be seen in the second half of 2010, with BIA/Kelsey expecting traditional radio revenues to rise to $13.5 billion. Analysts at BIA/Kelsey continue to see online and, in particular, mobile, giving radio a further increase in revenues as stations embrace cross-platforms and begin integrating them directly into their sales strategies. In 2009 online revenues will bring the industry an additional $382 million (up from $342 million in 2008). BIA/Kelsey forecasts the number will rise to $459 million in 2010 and by the end of 2013 the compound annual growth rate for online revenues will have increased nearly 16 percent.
“There are many reasons we believe that radio will rebound this coming year, especially in the second half, and hold its own in the coming years,” said Mark R. Fratrik, Ph.D., vice president, BIA/Kelsey. “Among them, radio has strong brand equity in local markets, the economy is slowly coming out of recession, the industry continues to show strong listenership levels with teens and younger adults, and the possible introduction of FM radio receiving chips in cellular phones will generate both a positive image effect on radio and an increase in radio listening.”
As stations begin capitalizing on new media models for radio, they will keep their listeners engaged throughout the day. BIA/Kelsey sees local mobile search and local mobile video as particularly strong categories where radio can build on its strong brand equity in local markets and compete well with third-party partners. The trick is to demonstrate to local advertisers that their message can be effectively bridged between media.
“Radio’s online assets have proven to positively impact consumer behavior,” said Rick Ducey, chief strategy officer, BIA/Kelsey. “Now radio has to extend this ability to impact consumers into its advertising efforts. Once the cross-platform model is fully embraced by sales teams, and advertisers learn how to effectively plan and buy radio’s digital and air assets, the revenue will follow.”
Ducey suggests that radio companies and station operators can leverage online and mobile media in several ways, including complementing their on-air advertisers and acting as a promotional partner to Web sites. Stations can also focus more on vertical opportunities by beefing up their Web and mobile sites by adding content and services. www.kelseygroup.com/ilm2009.
A comprehensive profile of all 300 radio markets is available in the third edition of the quarterly Investing In Radio® Market Report and the
2009 Investing In Radio® Ownership Report published by BIA/Kelsey. Both publications are part of the Investing In financial guide series that includes market trend analysis, demographic and economic overviews, competitive overviews, technical data, ownership data, pending and completed transactions, and Arbitron ratings. Information on these publications is available on the BIA Web site at
http://www.bia.com/publications_reference_radio.asp.
