Borrell Updates Advertising Forecast

9-2-14

A lot of forecasting experts have revised and updating their 2014 and 2014 ad spending predictions now that they've had an opportunity to see an improving 2014 economy and more data on digital platforms, which will continue to be the shiny new toy for marketers. The new Borrell advertising forecasts paint a rosy picture overall but "a fairly bleak one for traditional media."

Earlier forecasts by Borrell have shown mixed levels of growth or decline for expenditures on print and broadcast media. The organization now says, ad spending on print and broadcast media is forecast to decline 3% in 2015 while online advertising will grow 44%. Borrell says two online formats ? paid search and untargeted banner advertising ? are forecast to fall 4% and 13%, respectively while targeted display advertising will take over. "By the end of 2015, one of every five dollars spend on local advertising will be spent on targeted banners."

Borrell's Director of Research Corey Elliot, says ?The future we all knew was coming has shown up. The days of saying things like ?mobile is the next big thing? and ?targeted digital ads are going to be big? are over. In the next two years, we will see a tremendous growth in these ad formats, eclipsing any gains in any other media ? and even taking away a bit from other digital formats.?

Borrell?s new forecasts are based on an assessment of U.S. ad spending during the first half of 2014. The company focuses on the $104.0 billion spend by locally-based businesses across 3,000

U.S. counties. Here are some highlights:

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SCBA President Thom Callahan Slams Borrell Study

1-11-14

Southern California Broadcasters Association President Thom Callahan took issue with the recent Borrell Report (SEE OUR STORY HERE) in a post on Don Barrett's L.A. Radio website. Barrett's column pointed out that L.A. radio revenue was once $1 billion and in 2013 it's projected to be only $640 million. Borrell predicted that radio would be treading water over the next five years. Callahan told Barrett, ?It is easy to project the future when you don?t divulge how you arrive at your projections. I can only tell you what I hear from our member stations and that is optimism, based on ratings growth, improving revenue, and an exceptional new generation of salespeople that is giving the market new energy and results.?

Callahan also told Barrett radio is not in a 13-year decline as the Borrell Report indicates. ?The Borrell ?study? states that radio?s revenue decline began as early as 2006 and suggests it can?t all be blamed on the recession. Well, the fact is that 2007 was the radio industry?s greatest revenue year ever! All the trades should make a pledge that if they print negatives about radio, they should also report the positives as well. I think that is called being ?fair?.?

To be fair, most trades, including this one, always print positive stories about the radio industry and are often accused of carrying the water for the industry. One fact is clear, in the past few years radio has been, at best, flat, when other industries have seen tremendous revenue growth.

Read the full Barrett piece HERE. (You'll need to scroll down a few stories) 
Thom Callahan has written a blog about the Southern California economy HERE

(1/11/2014 10:59:47 AM)
I thought that Bob Struble's shyster technology was supposed to save the radio industry.

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SCBA President Thom Callahan Slams Borrell Study

1-11-14

Southern California Broadcasters Association President Thom Callahan took issue with the recent Borrell Report (SEE OUR STORY HERE) in a post on Don Barrett's L.A. Radio Website. Barrett's column pointed out that L.A. Radio revenue was once $1 Billion and in 2013 it's projected to be only $640 Million. Borrell predicted that radio would be treading water over the next five years. Callahan told Barrett, ?It is easy to project the future when you don?t divulge how you arrive at your projections. I can only tell you what I hear from our member stations and that is optimism, based on ratings growth, improving revenue, and an exceptional new generation of sales people that is giving the market new energy and results.?

Callahan also told Barrett radio is not in a 13-year decline as the Borrell report indicates. ?The Borrell ?study? states that Radio?s revenue decline began as early as 2006 and suggests it can?t all be blamed on the recession. Well, the fact is that 2007 was the Radio industry?s greatest revenue year EVER! All the trades should make a pledge that if they print negatives about Radio, they should also report the positives as well. I think that is called being ?FAIR.??

To be fair, most trades, including this one, always print positive stories about the radio industry and are often accused of carrying the water for the industry. One fact is clear, in the past few years radio has been, at best, flat, when other industries have seen tremendous revenue growth.

Read the full Barrett piece HERE. (You'll need to scroll down a few stories) 
Thom Callahan has written a blog about the Southern California economy HERE

(1/11/2014 10:59:47 AM)
I thought that Bob Struble's shyster technology was supposed to save the radio industry.

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Latest Borrell Report Reveals Fascinating Digital Facts About Radio

5-29-13

Digital revenue is all the rage. In the first quarter of 2013, according to the RAB, radio's digital revenue jumped 9 percent to $179 million. We see the record Pandora revenue numbers every quarter and we know there is money to be made in mobile...just ask Emmis CEO Jeff Smulyan. So, how much of an effort is the radio industry putting into grabbing that digital dollar?

Borell and Associates Senior Research Analyst Greg Harmon released his third report in a series examining how media hires and pays digital account execuitives. According to the study, 11 percent of radio stations have dedicated digital sellers, compared to 44 percent in TV and 57 percent in newspaper. The average starting salary of a digital AE in radio is $32,200 according to the Borrell study. Newspaper pays an average salary of $34,458. Television $42,250. And a Pureplay Internet company pays $54,100. (All are before bonuses and commissions.)

The Borrell study reveals that when a company has a dedicated digital seller, it will average twice the online revenue of those without digital reps. That's because the sales staff exhibits a greater ability to consult with and educate advertisers and has stronger capabilities to understand and sell digital products. But not everyone wants to be part of this digital revenue shift. One radio manager is quoted in the survey saying, ?We should be focusing on our strength, audio advertising, not selling our clients the pipe dream of ?interactivity? that digital has promised but seldom delivers.? It?s a minority opinion, but certainly represents a sibling rivalry occurring in local media families where the cute digital brother gets all the attention."

Hiring digital sales reps is on the upswing again. The first Borrell study in 2009 revealed that 60 percent of respondents had at least one rep whose sole focus was digital products. By 2011, the recession had cut that figure to 46 percent. This latest survey shows 62 percent of sales managers in newspapers, radio, TV, and yellow pages companies reporting that they employ digital-only reps.

The Borrell report examines responses from 220 media managers in the pureplay, newspaper, radio, TV, and directory industries. One-third were from newspaper companies, 56 percent from broadcasting, 12 percent from yellow pages, and 4 percent from Internet pureplays. It includes more than 200 open-ended responses from those managers offering insights and suggestions on digital vs. traditional sales compensation plans.

For more information about this survey, contact Greg Harmon at gharmon@borrellassociates.com

(5/30/2013 7:49:38 AM)
You have to forgive the sales manager. He has spent his career doing marketing the real way by building brands through a powerful medium that probably reaches tens of thousands of people in his market simultaneously. A medium that can make a clients business thought of first and liked the best. Now, he is asked to talk to businesses about how they can get 50 likes on their Facebook page. What does truly building a client's business have to do with that? That's "old school".

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Borrell: 2013 Looks Promising for Radio Online

1-10-13

RAB and Borrell Associates are getting a fascinating peek at how radio?s digital ventures are shaping up. Earlier this month they launched a survey intended to gauge the ?real? amount of online ad revenue stations are generating and what might happen in 2013. Borrell shared some of the preliminary findings with Radio Ink

*  This might be a better year for digital sales. Only one-third of the 400 stations responding thus far said their digital sales didn?t grow last year.  But for 2013, 60% said they expected revenues to grow ? and half of them said the growth would be 20% or more.
* More than two-thirds of respondents say they believe online ventures hold "significant potential" for radio stations.  Yet 54% of respondents rate their sales reps' ability to sell digital products as "poor."
* More than 40% of respondents say their digital strategy is bad, or don't know if they even have one.  Percentage who said their station's strategy was "brilliant":  less than 5%.

Want to participate in the 3-minute survey? The results, which will include an analysis of Borrell?s data from more than 1,300 radio stations reporting digital revenues, will be published next month.  Borrell has promised Radio Ink a sneak preview.

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Digital Will Dominate 2013 According To Borrell

1-11-13

The momentum and excitement about digital will continue this year according to the latest Borrell report. The company is forecasting local online growth of nearly 31%, from $18.7 billion to $24.5 billion. That?s even better than 2012, when local online advertising grew by approximately 20%.

If the Borrell predictions are correct, online would hold the No. 1 spot in terms of local ad share, beating newspaper in all but four U.S. markets. Last year, newspapers held the largest share in all but about one-fourth of markets. Three years ago, newspaper advertising was number one in every single market.

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The Borrell report says online advertising is expected to attain a 25.4% share of all locally spent advertising, distancing itself even further from the traditional local choices of newspapers, radio and TV. While the strength of digital marketing is certainly to credit, another reason for its strong numbers may be in the fact that legacy media companies are fighting for both sides. Of the $18.7 billion in digital advertising bought last year, half was sold by a sales rep from a yellow pages company, newspaper, radio station, TV station or local cable system.

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Borrell Bringing a Life Preserver to Forecast

10-26-2012

It's no secret that radio is still well behind print competitors in local ad spending; newspapers and Yellow Pages combine for about a quarter of all local ad dollars. But those mediums are sinking fast under the pressure of digital competition.Where will their advertisers go? Gordon Borrell of Borrell Associates has a pretty good idea. And he thinks there's a lot of room for radio to move in on print -- if radio understands where its opportunity really lies.

"Local advertising is undergoing a fascinating evolution," Borrell says. "Less money is being spent on classical-type advertising and more on dynamic marketing and promotions. The marketplace cacophony is so loud that it?s gotten harder and harder to sell spots -- or any other type of advertising, for that matter. What?s emerging is a powerful opportunity for radio to capitalize on what their beleaguered print competitors have discovered. Handled the right way, the Internet becomes not a way to make a few piddly extra bucks, but rather a significant revenue magnifier."

Are you prepared to take real advantage of the digital future?

Gordon Borrell, CEO of Borrell Associates, is a leading media analyst, top-ranked worldwide and frequently quoted in the Wall Street Journal, New York Times, Ad Age, and other publications. He's a popular and incisive speaker widely sought after for conferences and events, and you won't want to miss what he has to say.

Radio Ink's Forecast is the radio industry's exclusive financial conference, gathering radio owners, CEOs, CFOs, group executives, and managers with Wall Street and private equity investors and analysts to forecast the upcoming year. Well informed and noted economic, political, and media participants present trends, opportunities, projections, and analytical commentary on the state of business, especially as it impacts media. Now in its 10th year, Forecast has become the premium event in radio financial circles. The event is held at the Harvard Club in New York City and is closed to the press.

Immediately following Forecast, Radio Ink's "40 Most Powerful People in Radio" are honored at an exclusive, invitation-only reception, also at the Harvard Club. Forecast attendees will get the exclusive opportunity to mingle with these industry luminaries. Only registered conference attendees are guaranteed invitations to this premier networking after-party. Attendance is limited to 200.

Register for Forecast HERE

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Borrell To Unveil Eye-Popping Research

4-24-2012

Radio Ink is proud to announce that Gordon Borrell has joined our action-packed lineup at Convergence June 4th and 5th. Borrell will bring with him new research about local media and who's generating significant digital revenue. Borrell says, "It sounds clich? to say that the radio industry is on the precipice of great change. But it?s true ? much like the newspaper industry has seen wrenching change over the last five years. This incredible transformation to the print industry has thrust the digital managers into the positions of publisher and even CEO.  I expect much the same to happen in the radio industry in a few years. And I expect that when I address Convergence in June I?ll be looking out at the next wave of leadership in the radio industry. The media?s future is undeniably digital.  Convergence is the greatest preparation for that future."

Borrell's message to the industry: "Wake Up, Kick Ass, and Take Names." While he sees most radio stations squandering the Internet opportunity, he's also seeing some who are generating five to 10 times the digital revenue of their peers. "Radio has a huge advantage when it comes to the Internet, and those who can see it -- and follow the lead of a few others -- will make the transition from a "medium" company to a media company."

See the Convergence 2012 agenda HERE
Register NOW before your seat is taken.
Submit a nomination for our DIGITAL AWARDS

View the original article here

Borrell To Unveil Eye-Popping Research

4-24-2012

Radio Ink is proud to announce that Gordon Borrell has joined our action-packed lineup at Convergence June 4th and 5th. Borrell will bring with him new research about local media and who's generating significant digital revenue. Borrell says, "It sounds clich? to say that the radio industry is on the precipice of great change. But it?s true ? much like the newspaper industry has seen wrenching change over the last five years. This incredible transformation to the print industry has thrust the digital managers into the positions of publisher and even CEO.  I expect much the same to happen in the radio industry in a few years. And I expect that when I address Convergence in June I?ll be looking out at the next wave of leadership in the radio industry. The media?s future is undeniably digital.  Convergence is the greatest preparation for that future."

Borrell's message to the industry: "Wake Up, Kick Ass, and Take Names." While he sees most radio stations squandering the Internet opportunity, he's also seeing some who are generating five to 10 times the digital revenue of their peers. "Radio has a huge advantage when it comes to the Internet, and those who can see it -- and follow the lead of a few others -- will make the transition from a "medium" company to a media company."

See the Convergence 2012 agenda HERE
Register NOW before your seat is taken.
Submit a nomination for our DIGITAL AWARDS

View the original article here

CBS's Kucharz Wins Borrell Innovator's Award

March 21, 2012:

President of CBS Local Digital Media Ezra Kucharz has been named the winner of the 2012 Borrell Award of Merit, presented annually to an executive who has "fostered and driven significant change" within an organization." Kucharz, who oversees digital ventures for CBS's 158 TV and radio stations, was recognized for "intelligence, innovation, and most of all the execution of strategies within a big legacy media company."

Borrell & Associates CEO Gordon Borrell said, "We've seen firsthand how difficult it is for 'old media' to understand the business model of new media. There's a revolving door for innovators at a lot of these companies because it's hard for them to stomach real change. In two short years Ezra has been able to move one of those very large battleships, mobilizing a sales force of more than 1,600 and an incredibly diverse group of radio and TV people to work collectively at CBS to seize the bigger opportunities on the Internet. What he's been able to do with the full support of CBS have been remarkable and should become a model for other media going forward."

The award was presented at Borrell's Local Online Advertising Conference in New York.

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Borrell Says Big Political Money On The Way

3-10-2012

It's what many broadcasters have been waiting for to give radio that much needed revenue kick-in-the-pants. A study released by Borrell and Associates predicts that nearly $10 Billion will be spend on political advertising in the traditional media. "All media will see double digit increases as candidates blast their messages across the airwaves, mailboxes, the Internet and front yards." Borrell says that a large amount will be spent by presidential candidates and more than 13,000 other state and local contests will vie for air time and ad space. "In all $1 of $25 spent on advertising in 2012 will support political contest, issue or point of view. So where is Borrell predicting radio fits into the mix?

Broadcast TV will receive the bulk of the political advertising pie with 57% according to the Borrell study. A distant second will be cable with 9.5%, followed by radio with 8.3% then telemarketing with 7.7% and newspaper with 7.1%. Borrell says the Internet will see 1.5% this year. The total dollar amount to be spent on radio in 2012, according to the Borrell study, is $819 Million compared to broadcast TV which will see $5.6 Billion.

(3/9/2012 8:28:31 PM)
And somehow no one sees anything the slightest bit wrong with this state of affairs. . .

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Borrell: Auto Dealers Move Tons of Money Online

June 24, 2011

Some of these numbers may give you reason to make sure you have all your digital ducks in order. And, perhaps some savvy salespeople who new how to speak the digital language. Radio's biggest advertiser is moving advertising dollars to all things digital. The new Borrell report concludes that 32 percent of automotive ad budgets are spent online. That's more than they spend on any other medium. "The heyday of automotive advertising may not exactly be gone for good, but it sure feels like it. Borell reports that auto dealers will spend $22.6 billion online this year. "The pre-Internet era of TV and radio scooping up all the branding dollars and newspapers and magazines collecting the ?Big Sale!? dollars have faded." 

The Borrell study says the dollars are going principally to banner advertisements and paid search, with additional non-advertising expenditures paying for website design, inventory database management, lead-generation fees and search engine optimization. "The efficiency of the Internet to meet the car-buying public isn?t the main reason advertising channels have changed. The economy has shaken the basic underpinnings of the entire dealership system. In the past four years, an average of 86 new- and used-car dealerships have closed every week. That?s 17,000 fewer advertisers, with a few thousand more expected this year. What?s worse is that the biggest advertisers in the bunch ? the mega-dealerships created during the consolidations in the 1980s and 1990s ? have been hit hardest. And a new phenomenon ? where slightly-used cars are in higher demand than many new cars ? is rippling through the marketplace."

What?s in store for new- and used-car automotive advertising? Borrell is forecasting an overall increase of 7.2 percent, from $21.1 billion in 2010 to $22.6 billion this year. "Every medium except yellow pages is seeing an increase in auto advertising this year. but the largest dollar increase is expected for online media, up 11 percent this year, from $6.6 billion to $7.3 billion.

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