Radio continues to be a viable and vital channel for advertisers, as it has been for the past 100 years.
As we peer into what to expect for radio revenue in 2024, there are lots of numbers out there from analysts and experts. The outlook is bright for the most part, with radio’s resiliency shining through.
This medium remains a pillar that engages and reaches a majority of the population across demographics and geography. In fact, 91% of people 18 and older listen to radio monthly. This devoted listening equates to 10.9 hours weekly. It continues to be the leader in ad-supported audio and the preferential choice for in-car listening.
Radio has much to provide its advertisers and fans, yet many misconceptions exist about its value as an advertising vehicle. It’s easy for this fallacy to permeate a world where some think digital listening and watching are the only media worth discussing. Digital may get the headlines, but it’s hard to beat radio’s reach and ability to engage and drive buyer intent.
As you plan for 2024 and the conversations you’ll have with advertisers about radio’s value and strengths, keep these facts top of mind:
- A study found that audio ads have higher engagement and outperform video ads.
- Research proves that radio ads lift digital ad tactics.
- Radio’s locality makes it a valuable ad channel for local businesses.
- AM/FM radio listeners have high purchase intent.
Radio Revenue: The Political Spend
Political is the talk of the 2024 ad spending frenzy, and it offers more context on how radio revenue will rise this year.
The 2024 election has already delivered $43 million in revenue for radio in 2023 (as of late November). The revenue for 2024 includes these projections:
Even though it’s a national race in 2024, most spending will occur at the local level, even for the presidential campaigns. That’s because nominees will spend much more in swing states. Those classified as a swing state have changed, with analysts saying these states will determine the outcome:
- North Carolina
- Radio is in a solid position to gain revenue from political spot ads.
- The FCC has regulations about ad costs for “legally qualified candidates,” which impacts what you can charge. These limitations don’t apply to PACs. Keep this in mind when forecasting. Another tip is to complement radio with digital ad tactics to increase the total campaign revenue amount.
- You should prioritize the “tightest” races in your market when prospecting media buyers.
Retail is routinely the highest radio spender, and the many subcategories of this are varied, from local shops tonational franchises. These advertisers have two urgent needs — more sales and more employees. You can help them with ads for both, designing campaigns to reach the right audience based on dayparts and programming. Whether it’s a promotion for a holiday sale, announcing a new location or driving job seekers to apply, radio is a strong channel for all these advertising goals.
Real estate is a volatile industry and different for every region. Housing inventory remains low, and interest rates are holding but are still higher than they’ve been in several years. If they fall in 2024, real estate will get a boost.
Regardless, real estate agents need to reach local audiences frequently, and radio enables them to do so. They may need help with messaging to potential home buyers and sellers. With a fluctuating market, they need to build trust. Since radio has such a strong relationship with its listeners, it’s the ideal tactic to continue cultivating this.
Local dealers are loyal radio advertisers. They understand the value of local spots and are often your partners for events with on-air personalities. The auto industry has had a unique few years, which included inventory shortages. They’ve completely recovered, and inventory is now sitting on lots a little too long. Incentives have come back, so they now have more specials to broadcast.
To capture more of their traditional advertising dollars, you should consider a few things. First, talk to them about more radio spots beyond new and preowned car sales. Dealerships make a lot of money from service and parts, so they should advertise these things. Second, many businesses have an overabundance of electric vehicles, which were once hard to find. There’s some trepidation from consumers on this, and radio ads can be a compelling way to clear up misconceptions and emphasize the cost savings of EVs while people sit in traffic and burn gas.
The RAB reports that financial services are big radio spenders. Creating trust is critical in financial advertisements, which makes radio a better choice than digital. Listeners also pay more attention to these ads, and if they involve reads from loved on-air talent, their impact can be great for the advertiser.
Financial topics can be complex, and spots are only so long. When talking with financial services about radio ad campaigns, discuss ways to be concise and transparent with copy, and ensure there’s a specific CTA (call to action) to visit in person or online.
Every market has health care advertisers, and radio spots work well for them in several ways. This industry also wants to capitalize on the trust factor of radio, and they realize that consumers have options when choosing physicians. These organizations also need employees, as health care workers, especially nurses, are in great demand. These gaps are only growing, and health care facilities need to leverage every ad channel to find their next hire.
To gain more dollars from health care advertisers, discuss how radio spots are an excellent tactic for whomever they want to speak to — patients or potential employees. Pitch them ideas about using real testimonials from current patients and workers to make this authentic.
- There’s not much change in the industry profile of which ones spend the most on radio, but there is always a chance to grow this by ensuring they know radio drives results for just about any ad goal.
- Your top radio advertisers have new challenges and concerns; be ready to address them with ideas on how to be more strategic with the creative.
- Presenting new angles for radio spots and collaborating with on-air talent can make your station more appealing to advertisers.
Sources: Nielsen Audio Today June 2023, dentsu The Attention Economy 2023, Edison Research’s “Share of Ear”, RAB Audio Pulse, Nielsen Buyer Insights, Vivvix/CMAG, AdImpact 2023 2024 Projections, Statista, S&P Global Market Intelligence, Insider Intelligence, World Federation of Advertisers and Ebiquity, Grand View Research Traditional Radio Advertising Market Size, Share & Trends Analysis, RAB Radio Industry Top Spenders, Wall Street Journal, Economist Intelligence, USA Today, NYU