Digital Record Breaker For Radio: Industry Delivers Its First Billion-Dollar Digital Year.

Story by Inside Radio

The radio industry just came off a record year for digital. For the first ever, radio’s digital ad revenue topped $1 billion during 2019, a 25% increase compared to a year earlier. That’s according to new Borrell Associates research commissioned by the Radio Advertising Bureau.

Based on data collected from Borrell from thousands of radio stations, the RAB says digital accounted for one out of every ten dollars in radio industry advertising revenue last year. And to put that growth into perspective, the trade group says digital revenue is now growing faster for the radio industry than it is for any other media segment that is also selling digital advertising. “As radio continues to gain renewed interest by advertisers and the media buying community, they are recognizing radio’s assets beyond broadcast,” RAB President Erica Farber said in a press release Wednesday.

The average radio station booked $299,213 in digital revenue in 2019, and the average market cluster billed $1.3 million.

The report, being made available to RAB members, also looked at the top five digital performers in local markets. It shows average digital revenue ranged from $664,651 for top performing clusters in the smallest markets to $17.1 million in the largest.

The findings are a part of “Digital Sales Skyrocket, Hitting $1 Billion,” the RAB and Borrell’s eighth annual report on the radio industry’s digital revenue.

“The radio industry is carving out large chunks of the digital advertising pie from other print and broadcast competitors who also sell digital marketing to local businesses,” said Gordon Borrell, CEO of Borrell Associates. “Our latest survey of radio managers shows that they have stronger and more positive attitudes toward digital media. That’s a very good thing, because our survey of ad buyers also shows that radio’s most at-risk customers are the ones who aren’t being offered a digital package by their sales reps.”

‘More Aggressive’ Growth In 2020

Just one month into the new year, Borrell Associates is forecasting that radio will set another new record for digital revenue in 2020. The segment will expand at a faster pace this year, predicting a 29% growth rate that will bring in $1.3 billion in digital revenue by year-end. “Growth in 2020 is forecast to be even more aggressive than 2019,” the report says. “The radio industry has so passionately embraced the digital beast that its growth far outpaces that of any print or broadcast competitor that is also trying to sell digital marketing.”

The digital gains are helping offset declines in traditional advertising. Borrell’s data shows local radio sales declined by $248 million last year while the industry’s digital revenue increased by $198 million over 2018 levels. The net loss was $51 million, or a half percentage point decline.

While progress is being made, the report says there is “ample room” for growth as a majority of radio advertisers still aren’t buying digital products from sales reps. “This report underscores the importance of being a well-trained and knowledgeable radio professional and the RAB continues to deliver the digital training and professional development required for radio sellers to best serve their clients,” said Farber.

The data is based on an analysis of digital revenue from 3,488 radio stations, and Borrell survey findings from 1,006 radio ad buyers and 208 radio managers representing more than 1,900 stations.