Digital Revenue for Radio Stations: Which Tactics Drive the Most Sales?

What Did Advertisers Buy in 2023, and What Do They Plan to Purchase in 2024?

Local radio buyers shared what they bought and will buy. The top digital tactics in 2023 were:

• Email marketing
• SEM (search engine marketing)
• Social media ads
• Streaming audio
• OTT/CTV
• Display ads
• Mobile in-app ads

Social media was the most purchased, followed by display ads and SEM.

The expected spending in 2024 is similar, with social at the top, SEM in second, and display in the third spot.

Which Digital Tactics Will Advertisers Increase Spending on the Most?

Part of the report looks at where the biggest increases will be. For radio ad buyers, 70% said they would increase spending in 2024 on these digital ad types:

• Social media
• SEM
• Display ads

This segment of advertisers is also 3.5 times more likely to increase investment in OTT compared to businesses that don’t buy radio ads.

Which Tactics Drove the Most Digital Revenue in 2023?

So, what fueled digital revenue growth for stations in 2023? These tactics led the way:

• Targeted display
• SEM
• Social media
• Basic display
• Streaming audio
• OTT

These results align with how local advertisers allocated their budgets. So, what does all this mean for digital sales in 2024?

Putting Together the Pieces to Fuel Digital Revenue

The benchmarking report predicts that radio stations will generate $2.1 billion in digital sales. Advertisers are spending more and are also ready to buy something new. You can use this data, your market knowledge and your customers’ goals to provide a digital strategy that drives performance and revenue.

Here are some tips.

Local Advertisers Do Buy Social Media Ads from Stations: How to Make Your Offering More Appealing

Any business can submit ads to social media platforms through self-service. Stations could also do the same, with some requirements. However, to do this well, ad buyers or providers must have expertise on the platform. Throwing some ads up on Facebook or Instagram without this could lead to failure.

Businesses do believe in the value of social ads and cite them as a top purchase. So, how can you capture that increase in spending? First is understanding the company and its target audience. That’s the starting point of choosing a social media channel to use.

Then, you build a cohesive plan to define targeting criteria and develop compelling creative. Your customers don’t have the knowledge or time to manage this, and you likely don’t either. You need a partner that has expertise in all best practices.

You always want to sell social with other digital ad types, so the campaign covers the full funnel. Operationalizing the execution will be critical. If you have a process supported by experts, it’s less strain for you. Performance should also improve, which will make advertisers continue to buy.

Redefining Your SEM Sales Strategy

SEM is critical for local businesses, which is why it’s in the top three tactics they purchase. Radio stations may have hesitations about selling SEM, as it’s not a high-margin product. However, SEM is a tactic that runs continuously for some, so there’s the volume aspect.

Advertisers also expect returns from their SEM investment, which means your package needs to include:

• Appropriate keyword selection
• Multiple copy options since paid search is dynamic
• Conversion-based optimization, which is the practice of automatically allocating budget to the keywords and text ads that deliver the most conversions

In this model, advertisers don’t have to worry about keywords, copy or continuous monitoring. If you can provide this, you can reap the revenue.

Keeping OTT Top of Mind

OTT/CTV is the fastest-growing local digital tactic. It will capture a lot of political dollars as candidates and PACs seek to target specific voters. Other industries also find this tactic valuable, from restaurants to retail to professional services.

There may still be hesitation from your advertisers if they don’t have the creative assets, but you can help your advertisers with video ads. There are many cost-effective options, including subscription platforms. They likely already have some video content, which could work with some tweaks. Getting them over this barrier could drive their spending. OTT is also trackable, so they know the impact, which is challenging to do with traditional TV ads.