Radio industry investments in online initiatives paid strong dividends last year, according to a new survey of local Web site revenue released Friday (May 1) by Borrell Associates. Radio stations posted another double-digit growth year, building their local Web revenue from $189 million in 2007 to $220 million this year, an increase of 16.4 percent. Borrell, which analyzed local revenue for 1,994 radio station Web sites, projects 26 percent growth for 2009, which would bring the industry to $277 million in local online advertising.
While online is the only radio sector showing significant growth, the industry lags well behind its newspaper, TV and Yellow pages competitors, which each brought in more than $1 billion in local online revenue last year. The importance of online advertising to legacy media companies intensified in 2008- it now accounts for 3.4 percent of radio and TV station gross
All told, $12.6 billion was spent in online advertising by local advertisers last year.
“Unlike their more diversified legacy media competitors, radio operators remain focused primarily on selling banners on radio station sites or up-selling advertisers into their audio-streaming programs,” the report states.
Average per-station Web revenues ranged from $18,322 for small-market stations to $183,229 for those in large markets. Top performers achieved between $231,000 and $1.2 million, depending on market size. However, smaller market stations posted the largest percentage growth- 24 percent for markets 51-210 compared to 12 percent for markets 1-20 and 20 percent for markets 21-50.
In February, the RAB reported that “off-air” radio revenue, which includes all advertising other than on-air spots and is largely driven by digital initiatives (including national online revenue) increased 7 percent in 2008 to $1.8 billion.