BIA Advisory Services has updated its outlook for local radio ad spending in 2022. The firm now expects stations to sell $12.7 billion in over-the-air local and national spots this year. That is an 11% increase from the $11.37 billion projected in December. At the same time, BIA has also fine-tuned its digital outlook. It now anticipates local radio stations will pick up an additional $1.7 billion in revenue from their online activities. That’s 23% less than the $2.17 billion it had earlier predicted. The figures do not include revenue from the national radio networks.
The top audio ad sub-vertical in 2022 is forecast to be insurance. BIA estimates audio and property insurance companies will spend more than $700 million this year on radio advertising, which is $150 million more than the second-largest ad category of fast food. The firm also forecasts that the 2022 midterm election season will deliver more than $400 million in advertising.
“For 2022, we see local advertising up 11.4% from 2021, but just up six percent if you exclude political advertising. This year, we see an almost even split between traditional and digital advertising nationwide,” said CEO Tom Buono during a recent episode of BIA’s Leading Local Insights podcast.
The automotive category is likely to face continued challenges, however. Nevertheless, BIA says $1.25 billion will be spent on radio from the category overall. It will be led by auto manufacturers, the so called “tier one” spenders, which BIA estimates will invest $471 million in radio. Local auto dealer associations, the so-called “tier two” spenders, are forecast to spend $367 million. With “tier three” spenders – the local dealers – predicted to add another $415 million to the total.
“This is a vertical that has been devastated over the last couple of years due to COVID and then supply chain issues,” said Buono, noting BIA had projected auto ad spending was down more than 30% in both 2020 and 2021. “However, we are quite bullish on a rebound as the pandemic and supply chain issues wane, especially in the second half of the year,” said Buono on the podcast.
SalesFuel CEO C. Lee Smith said that the auto manufacturers are encouraging dealers to “go digital” as they restart spending. “The good news is that some brand’s co-op plans now cover certified pre-owned vehicles,” he said. That list includes Ford, General Motors, Audi, BMI and Subaru.
In addition to broadcast radio, BIA has also released an ad estimate for Pandora. It forecasts the streaming service to take in $400 million in audio and display advertising from local market sales this year.