The latest revenue data from BIA Advisory Services details just how serious the damage was to radio from the 2020 COVID-19 pandemic. The industry took a big hit last year due to businesses being forced to close, governments locking down and advertising coming to a near stand-still.
According to the first quarter edition of BIA Advisory Services’ 2021 Investing In Radio® Market Report over-the-air advertising revenues dropped by $3 billion to $9.7 billion, a -23.6 percent decline from $12.8 billion in 2019.
Digital ad revenues posted a slight decline to $939 million in revenues in 2020 versus $1 billion in 2019.
“Local radio stations have been feeling the impact of new competition for the past few years; unfortunately, the pandemic just exacerbated the problem and it will take some time to recover,” said Mark Fratrik, SVP and Chief Economist, BIA Advisory Services. “The shining star continues to be radio’s online digital advertising revenues, which will outpace over-the-air growth this year and moving forward. Those broadcasting groups that have invested-in and oriented their companies toward digital will benefit faster from that foresight.”
The good news is that public companies have reported that 2021 is rebounding with second quarter pacings up anywhere from 50% to 80% over the lows of Q2 in 2020. Most companies are hoping to be back to 2019 revenue levels by the end of this year or early part of 2022.
We’re also starting to see more radio sponsored events pop up across the country, a huge revenue generating category for the industry. Even though they are not yet full-capacity events, it’s clear listeners are clamoring to get out of the house and get back to enjoying their lives with friends, family and their favorite radio station.
Fratrik forecasts 2021 total local radio revenues to add nearly $2 billion back reaching $11.7 billion, with $1 billion coming directly from online revenues; a 9.7 percent increase over 2020.