Radio's share in AdEx remains constant, retail firms key spender

The recently released dentsu e4m Digital Advertising Report 2024 noted that the radio medium, despite a decline over the years, will continue to maintain a spends share of 2% in the coming years. The report attributed the popularity of traditional radio to the rising consumption of and competition from online radio. In terms of value, this share amounts to Rs 1,814 crore for 2023.

A growing number of audiences, especially Gen Z, now prefer on-demand content such as music streaming, podcasts, and personalized content on smart devices. This shift also provides advertisers with a more profound insight into audience demographics and consumption patterns, enabling more precise targeting opportunities.

A deeper dive shows that among all sectors, tourism and retail are the most bullish about radio as a medium of advertising, having allotted 7% of their ad spends to the channel.

A snapback into the last few years shows that in 2022, radio’s share amounted to Rs 1,597 crores, which was a slight dip as compared to 2021 when it was Rs 1,617 crores. The 2021 dentsu report noted that online audio streaming services have begun to give stiff competition to radio as a channel. However, back then too, retail continued to remain positive about it, having spent 8% of its ad spends on radio (significantly more than other sectors that allotted barely 1-2%).

The report had further noted that the power of radio came alive when the US government successfully persuaded citizens to join the army through radio during World War I.

However, the pandemic year (2019-2020) had seen radio’s share at 4% in the digital ad pie, more than the following 3 years. The value was around Rs 2,479 crore at that time. Online music streaming was at par with the reach of radio, dentsu’s report mentioned. This is when radio’s monthly reach had dropped by 10%, amounting 41% for total audience. Online music streaming had a competitive monthly reach of 37%.

(Source: dentsu-e4m digital advertising report 2021, 2022, 2023, 2024)

The growth in 2023 as compared to the last two years provides a ray of hope for the radio channel. exchange4media earlier reported that market players have taken note of the same and there is talk about expanding radio advertising revenue streams to create a stable presence in the market.

Abraham Thomas, Chief Executive Officer, of Reliance Broadcast Network had told e4m that the radio industry is set to see further advancements in the digital space, which will significantly multiply overall investments by brands and advertisers. Currently, approximately 20% of business for private firms comes from NFCT, with digital playing a major role. “Radio is transforming into a digital-first media platform, leveraging RJs, online presence, social media marketing, influencer marketing and engagement strategies,” he mentioned.

Similarly Nisha Narayanan, COO and Director, Red FM and Magic FM also said last year that they are looking at substantial growth in AdEx for the sector. “Regional markets are driving AdEx volumes, and our inventories are fully utilized. It's time for radio players to seek realignment of pricing and withdraw bonus offers to prioritize delivering the best entertainment to listeners and maximise earnings,” she added.

Nominations in radio, audio and podcast category open for e4m Golden Mikes 2024. Click here to know more.