The radio industry’s digital revenue rang in at a healthy 6.8% last year, reaching $1.9 billion and stealing market share from other local media competitors. The average market cluster now makes more than $2 million in digital sales. For 2024, the industry is likely to see double-digit growth rates, pushing revenue past the $2 billion mark as digital sales approach nearly $1 in every $5 of revenue.

The findings are part of RAB’s 12th annual digital benchmarking report, a 52-page document detailing how radio stations are developing their digital operations. The report, sponsored by Marketron, covers sources of digital revenue, attitudes of radio managers on how digital sales are developing, sales compensation and what types of digital products radio advertisers plan to purchase this year.

Among the findings:

• Radio grew market share of “obtainable digital revenue” for local media companies, stealing share from competitors.
• Strong digital sales since the pandemic have helped restore overall growth to the radio industry, delivering a positive Compound Annual Growth Rate of 6.4% since 2020 when adding digital and core radio revenue.
• Seventy percent of radio buyers are planning to purchase something new this year; the top three things are digital products that most stations sell.
• More than half of radio buyers don’t yet buy digital advertising from their radio station, signaling large upside potential.
• Station managers are clamoring for more digital-only sales reps to meet demand.

“While broadcast continues to be the core of radio’s revenue,” commented Erica Farber, president and chief executive officer, RAB, “greater interest in digital by advertisers creates an opportunity for radio to super serve its local clients. Comprehensive understanding of digital services and acumen can create both professional and revenue opportunities for radio marketing professionals.”

“What’s most impressive is that radio came out fighting for digital dollars when the pandemic hit and hasn’t let up for a second,” said Gordon Borrell, chief executive officer of Borrell Associates. “The fact that they’ve stolen market share from competing media for the past four years is remarkable. They’re not quite owning the digital space yet, but they are well on their way.”

The annual report showed that digital sales in 2023 comprised 21% of total ad revenue, averaging between $82,835 for a small-market station and $1.2 million for a station in a large market. The average small-market cluster made $364,426 while the average cluster in the largest markets made $4.8 million.

“The annual benchmarking report is one of the most important for the radio industry. This year’s results offer visibility into what’s helping digital ad sales grow for stations and what local ad buyers think,” noted Todd Kalman, senior vice president, sales at Marketron. “It provides a look back at the progress made and where we’re headed, with many opportunities for radio companies to increase revenue with digital and linear campaigns. We’re excited about the future and helping the industry evolve to put these insights to use to win new customers and expand share of wallet with current ones.”

The full report is available to RAB members on RAB.com: Click here. A live webinar featuring the survey results presented by RAB and Gordon Borrell is available for free to RAB members and survey participants. The live presentation takes place at noon CT on Wednesday, February 21. To register for the live presentation, click here.