Local Radio Is Getting Close To Billing As Much As Newspaper

At least we're growing.  And, clearly, they are not.

The local radio market is growing, albeit at a more moderate pace than it once did, by expanding its offerings to off-air platforms, providing a wider range of listener experiences and advertiser opportunities, according to the firm's new state-of-the-industry report. "Local Radio Stations Profiles and Trends for 2014 and Beyond" provides a comprehensive view of the industry based on the long-term research and analysis conducted by BIA/Kelsey for its clients and the industry. 

According to the new BIA/Kelsey report, the five biggest local advertising categories for radio are: retail (18.0 percent of total radio industry revenue), financial/Insurance (17.0 percent), restaurants (14.5 percent), automotive (14.0 percent) and technology (10.0 percent). BIA/Kelsey says local radio generates over 10 percent of its advertising from these five different groups of advertisers. And, the report says local radio receives 14.3 percent of all advertising spent by finance and insurance companies and 12.1 percent of all advertising spending by restaurants.

Perhaps we should wait for RAB to issue their quarterly radio revenue trend report later this month  (here's the latest one), but I think it's safe to say this:  focusing on national business growth or online development won't make up for a lack of a solid local sales presence.

Audiences Up, Revenues Down

A reoccurring theme that's been happening as I visit radio stations:  someone brings up morale and cites the fact that their company mandated across the board staff pay cuts after the financial collapse of 2007-2008, complaining that those reductions have still not been restored.

As a partner in a small business that has grown in that difficult environment, I always try to explain the economy and help them understand what a huge toll the downturn continues to take on everyone except the very highest earners.

The more specific and detailed I get, I see eyes glaze over.  I suppose that's why Thomas Carlyle called economics the dismal science.

For that reason, I want to congratulate Country Aircheck in their annual June print edition for again tabbing country format ratings and revenues for three pages of charts/trends for the last decade from BIA/Kelsey (click for an invitation to their latest webinar on the subject) even down to specific dollar and audience share data on 274 country radio stations and 17 group owners.

I worry that those pages, which explain it all in undeniable numbers, will be the least read section of the always-fascinating publication.

If you care about your career future and the state of American business, start with this chart but really spend some time with the numbers of stations you know a lot about.

We are not out of the woods yet and if you think it's only your radio station that is affected in this way, make a visit to your local Chamber Of Commerce, a trusted realtor or hometown bank manager.

You Don't Have To Have The Highest Ratings

The top ten revenue radio stations nationally, released by BIA/Kelsey yesterday clearly demonstrate that, while being top-ranked in ratings or being in a metropolis is nice to have, it's not essential to being a top biller.

Let's take two recently-released numbers that actually have no "real" relationship to one another and try to coorelate them to see what we can learn with some quick back-of-my-napkin-at-lunch calculations:

WTOP ranks #1 nationally in total revenues from market #8 DC with a 7.5 audience share and is in the top tier of three stations virtually tied in share of audience between a 7.0 and 7.5: $8.5 million per share.

KIIS ranks #2 in revenues from market #2 LA, but is only ranked #3 6+ with a 4.4. Still, KIIS is in that first tier of four Southland stations which have between a 4.2 to a 4.9. Almost $13 million for every share of total audience in the latest monthly.

KFI is #3 nationally in revenue rank, in spite of being #1 in share of total audience with a 4.9 in the latest monthly PPM data. $9.8 million for each of those 4.9 audience shares.

Also in LA, KROQ ranks 7th in national revenues with a 2.7 share of audience 6+ according to the latest month, amidst a group of seven other stations with between that 2.7 and 3.1 in the third tier of PPM-rated stations (the second tier is four with between a 3.6 and a 3.8), with a 2.7. K-Rock, for example, ranks behind Go Country, but out bills the Los Angeles country station, thanks to a big morning show, which is a magnet for young males, managing to bill an incredible $15.6 million per rating share.

WBBM FM & AM ranks behind Chicago's #1 radio station 6+, WGN (5.4) and is tied for #2-#3 with a 4.7, followed by two stations at 4.5. $10.2 million per share.

In New York, the nation's most populous market the top rated 6+ radio station with a 7.3 share is WLTW, but they are actually being out billed by WCBS-AM which has a 2.8 share and also WINS-AM with its 3.5 share. 3.0-share WFAN is only $1.5 million behind. The 6th highest revenues in the USA belong to WHTZ, which notched a 5.2 6+ share last month. Per their latest ARB 6+ share: WLTW = $5,753,424. WCBS = $16,964,285. WINS = $12,000,000. WFAN = $13,500,000. WHTZ = $8.8 million.

Rank by $$ for each 6+ rating share in the latest monthly

1. WCBS = $16,964,285
2. KROQ = $15.6 million
3. WFAN = $13,500,000
4. KIIS = $13 million
5. WINS = $12,000,000
6. WBBM FM & AM = $10.2 million
7. KFI = $9.8 million
8. WTOP = $8.5 million
9. WHTZ = $8.8 million
10. WLTW = $5,753,424

Obviously, there are more factors involved in great revenues than just share of listening audience.

• Sell and position aggressively, command the best rates
• More commercial units per hour (news, talk and sports can carry about 30% more spots)
• BIG morning show which targets the most-desired demo
• Men matter; if you can hold onto them, you get the gold
  
• Making maximum use of all possible digital assets
• Be in a high revenue major market
• Have a very high cume (CHR and AC)
• Don't target over 55; the younger the better.
  

Do you have a different read on these stats?

Do you have a plan to grab more than your share of your market's dollars in the next year?