S&P Global

The average network radio ad rate per 30-second spot is expected to decline nearly 20% in 2020 compared to a year ago. According to S&P Global Market Intelligence, rising competition from digital audio sources, especially podcasting, along with dried up core ad revenue spend are the culprits behind falling ad rates.

The annual study gauges the performance of ad rates on Westwood One, Premiere Networks and Salem Radio Network. Data is collected from numerous program format clocks and analyzed in conjunction with the group’s view of advertising trends in the radio broadcast sector.

After weak ad revenue during the past few years, the COVID-19 pandemic exacerbated the ad revenue environment, according to the report. “Circumstances related to the pandemic-induced recession are forcing radio station and network owners to reduce operating costs and increase digital initiatives to conform to changing consumer listenership trends,” Kagan Associate Research Analyst at Media & Communications Atif Zubair writes.

The methodology for determining average ad unit rates across the radio networks includes estimated spot-ad revenues for the industry and average length of local and network ad spots on an hourly basis along with assumptions for average sellable programming hours per station and the ad sell-out ratio. The estimated ad rates for 2020 are based on data collected from format clocks on the respective websites for the radio networks as of Sept. 15.

Syndicated news/talk shows and programmed music formats averaged 16.7 minutes of ad time per hour in 2020 on the three radio networks. The three groups averaged a lower 16.6 minutes of ad time per hour in 2019. News/talk shows drew an estimated average of 18.5 minutes of commercial airtime per hour, compared to 14.4 minutes for shows in the music genre.