As radio companies released their Q2 2023 earnings reports, it quickly became clear that as national and local ad spend wobbled in the face of financial headwinds, digital was outpacing traditional OTA. As the industry hopes for a fast stabilization of the advertising economy, we may not have to wait as long as initially feared.
In a report from Madison and Wall, recent financial data points to the world’s 20 largest sellers of advertising outside of China, which cover 70% of the industry, posting a 5.3% growth in organic terms. This surpassed the 3.3% growth rate seen in the first quarter. The second quarter of 2023 saw notable changes in the advertising landscape, with digital platforms outpacing traditional TV networks in growth.
Digital platforms, including companies like Alphabet, Meta, Amazon, Microsoft, TikTok, and others, combined to grow by 7.4% in the second quarter. In contrast, TV network owners such as Comcast, Disney, Paramount, Warner Bros. Discovery, and others collectively lost 7.7% of advertising revenues during the same period.
While the TV advertising decline is concerning, it opens an opportunity for radio broadcasters to position themselves strategically in the changing advertising landscape. This year, AM/FM radio listenership overtook television viewership for the first time ever, meaning that there’s more chance to get more slices of the pie than ever.
As previously mentioned, the radio industry is also making strides in the digital advertising landscape: according to the Radio Advertising Bureau and Borrell and Associates, radio stations generated $1.8 billion in digital sales in 2022, reflecting a growth of 21.1% over the previous year. These digital sales accounted for nearly one in five advertising dollars.
With the shift towards digital platforms and the unique reach of radio, broadcasters can explore new avenues to engage with audiences and advertisers alike.
