Local Stations Stuggle to Overcome Loss of Auto Ads

By Andrew Gauthier 

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Star Tribune

Across the country, many local TV stations are running on fumes after their biggest financial source ran out of gas.

Traditionally, stations have gotten 25 to 35 percent of their advertising revenue from the auto industry, which all but stopped running ads when its future seemed uncertain, said Mark Fratrik of BIA Financial Network, a Virginia-based firm that advises companies about local media. According to the Television Bureau of Advertising, automotive ads were down 55 percent in the second quarter, while spots for car dealers dropped 43 percent.

The result: a record-breaking 30 percent drop in ad revenue for U.S. stations this year.

Some of that money is expected to return — and federal bailouts such as “cash for clunkers” helped — but most agree that auto advertising will never again shift into high gear. (Newspapers, by contrast, got only 6 to 10 percent of ad revenues from the auto industry.)

General managers at the Twin Cities’ four leading stations — WCCO, KSTP, KARE and KMSP — won’t say how much sales and budgets have shrunk, although it’s probably not as bad as elsewhere. More…

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