Radio Revenue Forecast To Grow To $15.8 Billion In 2022, As Total Broadcast Hits $40B Mark.
The bounce-back from pandemic-ridden 2020 for radio and the broadcast industry overall is expected to continue in 2022, with total broadcast advertising revenue surpassing that of pre-COVID 2019, according to a just-released forecast from Kagan, the media research unit of S&P Global Market Intelligence. Radio station industry revenue is predicted to increase 6.2% to $15.75 billion, while total broadcast revenue is forecast to gain 13.2% to $40.05 billion.
For radio, the ad revenue gain from 2021's $13.68 billion following a 23.0% decline in 2020 represents another step in the right direction following the pullback by advertisers in the auto, retail, travel and entertainment categories, all of which have been heavily impacted by the pandemic. “Radio’s lower ad cost, local audience and relatively high return on investment compared to other media should help it maintain its share of the U.S. advertising market,” Kagan Senior Research Analyst Justin Nielson says, “[although] radio also must compete with multiple streaming and on-demand options for music and talk, and is hindered by the new hybrid or permanent work-from-home economy, which has greatly reduced commuting hours during prime in-car radio time.”
Kagan's upbeat 2022 forecast for the U.S. broadcast station industry, up from both its $35.39 billion revenue in 2021 and $39.66 billion in 2019, is driven by an expected windfall of ads in the political and sports betting categories, with healthcare, professional services, telecom, banking and home improvement categories also expected to outperform 2021 totals. Automotive, retail and travel, meanwhile, should remain soft in 2022. “Core ad categories have mostly recovered from the COVID-19-induced advertising pullback of 2020,” Nielson says, “and broadcasters are feeling optimistic in the back half of 2021 with an expanded schedule of NFL games and new scripted content.”
Ad spend for 2022's midterm elections is expected to hit $3.25 billion, up 7.0% from 2018's midterms, given the 50/50 split between the two parties in the U.S. Senate and Republicans looking to flip the House Democratic majority. Kagan also singles out legalized sports betting as “a booming new ad category for broadcasters, with station groups developing new programming outside the games on betting lines and best picks,” citing Nexstar Media Group's recent launch of the SportsGrid Network and Sinclair Broadcast Group's partnership with Bally's.