Wireless Carriers Double Down on Spot Radio

August 19, 2013

This article is included in these additional categories:

Automotive | Broadcast & Cable | Media & Entertainment | Radio | Retail & E-Commerce | Telecom

RAB-Wireless-Carrier-Spot-Radio-Spending-Trends-Aug2013Radio revenues remained flat in Q2, as they did in Q1, per the latest revenue report [pdf] from the Radio Advertising Bureau (RAB). Total revenues were $4.66 billion for the quarter, and $8.44 billion for the first half (H1) of the year. Radio’s top advertisers appear committed to the medium, though, with 7 of the top 10 increasing spend in Q2. Wireless carriers in particular seem to be engaging in an advertising arms race of sorts.

AT&T, spot radio’s largest advertiser in Q2, hiked its expenditures by 61% year-over-year, while T-Mobile, the third-largest advertiser, increased its spending by 67%. Not to be outdone, Sprint doubled down to the tune of a 153% year-over-year increase, making it spot radio’s 8th-largest advertiser. In fact, Sprint’s first-half spending jumped by a massive 436% year-over-year.

Not surprisingly, then, the communications/cellular category was the biggest spender by dollar volume, with total category spending up 27% year-over-year in Q2 and 28% year-over-year in H1. The next-largest categories were: auto dealerships and manufacturers (-11% in Q2; -14% in H1); restaurants (-3% in Q1 and H1); and TV networks and cable providers (-11% in Q2; -7% in H1). Aside from the communications/cellular category, the only other 2 in the top 10 to increase spending in Q2 were department and discount stores (#9; up 33%) and concerts/theater/movies (#10; up 7%).

Overall, spot revenues were flat for the quarter, while slipping by 1% for the first half. Digital continues to be a bright spot, with revenues growing 16% for the quarter and 13% during H1, offsetting a 4% decline in network revenues.

About the Data: Spot Radio, Digital and Off-Air revenues are based on a pool of more than 100 markets as reported by the accounting firm of Miller Kaplan Arase LLP and extrapolated to the entire US. Digital Revenue is comprised from activity generated by websites, internet/web streaming and HD Radio including HD2 and HD3 stations. Network Revenue includes seven major radio network companies. Revenue data has been randomly verified since 2002.

The lineup of markets/stations may vary from year to year. Percent change is calculated on revenue adjusted to current year reporting.

Industry revenue growth rates are based on the 40 market X-Ray pool and may not be fully indicative of the industry results as a whole.

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