According to the latest survey by Borrell Associates, approximately half of local direct ad buyers (49%) and three-fourths of local ad agencies (78%) are purchasing AM/FM radio advertising.
The survey, which included 2,318 local ad buyers and ad agencies and was conducted from March to May 2023, revealed that among local direct buyers, only social media (65%) and event/sponsorships (54%) were more widely used than AM/FM radio among the 19 types of advertising included.
For agency buyers, AM/FM radio tied with social media as the most used media channel. The research is comprised of two separate surveys with 1,983 respondents from direct buyers and 359 respondents from ad agencies.
While radio ranked within the top three for usage, it placed sixth in terms of spending rate. On average, local direct radio buyers invested $34,167 annually in the medium.
In terms of streaming audio, 15% of local direct ad buyers reported purchasing it, with an average investment of $18,307 in the channel. This includes digital pure-plays, online streams of broadcast radio stations, and podcasts. Although podcasting and streaming audio usage continue to grow, most of the streaming ad dollars come from ad agencies rather than local direct ad buyers.
The study reveals that, on average, these buyers allocate $128,300 per year towards advertising, which accounts for approximately 4.6% of their gross revenue. However, a significant majority of respondents, more than 50%, reported spending less than 2% of their gross revenue on advertising.
During a webinar presentation of the results, Gordon Borrell, CEO of Borrell Associates stated, “It’s remarkable to me they can stay in business spending less than 2% of gross revenues on advertising. That’s probably why their business is shrinking, or at least flatlined,” he said.
“It’s a big opportunity here to convince advertisers that you are a marketing expert, you have some information that can help them, and advertising is an investment that is going to help their business grow.”
Maddy Troy serves as a writer and editor for Barrett News Media, with a specific focus on media business, advertising, and podcasting. You can find her on Twitter @Troy_Maddy.
Warner Bros. Discovery Sees 14% Drop in Ad Revenue in Q4
“This business is not without its challenges.”
Warner Bros. Discovery hosted its fourth-quarter earnings call Friday, and while the company reported hundreds of millions in losses, it was trying to view that as a positive.
The company reported a loss of $400 million, which is down sharply from the loss of $2.1 billion it experienced in the same time frame in 2022.
Additionally, Warner Bros. Discovery — the parent company of CNN — saw a 14% decline in advertising revenue during the final three months of 2023.
“This business is not without its challenges,” Chief Executive Officer David Zaslav said during the company’s fourth-quarter earnings conference call, according to CNBC. “Among them, we continue to face the impacts of ongoing disruption in the pay TV ecosystem and a dislocated, linear advertising ecosystem. We are challenging our leaders to find innovative solutions.”
The comapny did report an 86% increase in free cash flow, which now sits at $6.16 billion.
Jeremy Boreing: Every Outlet ‘Suffering From Facebook’s Massive Shift Away From News’
“Mark Zuckerberg remade the news landscape when he moved his company into the space, and then gutted it when he moved out.”
In recent years, Facebook has shifted its focus away from a news and link-sharing platform to become more focused on social interactions between users. That shift has been detrimental to news publishers, according to The Daily Wire co-founder Jeremy Boreing.
In a statement to Mediaite, the digital media executive wasn’t shy about his stance that the shift from Facebook has been detrimental not only to his organization but to the industry as a whole.
“Everyone is suffering from Facebook’s massive shift away from news. Mark Zuckerberg remade the news landscape when he moved his company into the space, and then gutted it when he moved out,” Boreing said. “A capricious trillion dollar company can crush entire industries without much effort. Daily Wire is disproportionately impacted because we were built with a focus on Facebook. Now, our focus has shifted to more premium content.”
The comments from Jeremy Boreing coincide with a report that conservative digital outlets have seen a dramatic drop in viewership, especially compared to figures seen in 2020. One outlet — Breitbart — has seen a drop in traffic of 87% compared to the tumultuous 2020 year that included the start and heights of the COVID-19 pandemic, as well as a contentious presidential election between Donald Trump and Joe Biden.
Court Approves Audacy Reorganization Plan
“We have achieved a speedy confirmation of our prepackaged Plan, which will enable Audacy to pursue our strategic goals and opportunities in the dynamic audio business.”
A United States Bankruptcy Court for the Southern District of Texas has approved a plan for Audacy to reemerge from its bankruptcy proceedings.
Under the plan, Audacy will equitize more than $1.5 billion of funded debt, which reduces its debt load by 80%, down from $1.9 billion to $350 million.
Audacy Chairman David Field was encouraged by the development.
“Today’s announcement marks a powerful step forward for Audacy, positioning the Company for an exciting future,” said David Field, who also serves as the President and CEO of Audacy. “As expected, we have achieved a speedy confirmation of our prepackaged Plan, which will enable Audacy to pursue our strategic goals and opportunities in the dynamic audio business.
“We aim to drive accelerated growth and financial performance, capitalizing on our scaled, leadership position, our uniquely differentiated premium audio content and the robust capital structure that we will have upon emergence,” continued Field. “I also want to express my gratitude to our team, who continue their outstanding work to serve our listeners and customers with excellence and fulfill our commitments without missing a beat.”
A statement from the company claims the restructuring “will enable Audacy to continue its strategic digital transformation and capitalize on its position as a scaled, leading multi-platform audio content and entertainment company differentiated by its exclusive, premium audio content.”