Peter Richardson, The Radio Bureau’s General Manager, looks at why the Standard Media Index (SMI) data shows a decline in radio’s revenue in 2023, and explores the real reason behind this.
With 75 percent of New Zealanders tuning in to commercial radio each and every week*, radio continues to capture the hearts, minds and ears of New Zealand audiences. And with such an impressive reach, the medium remains a compelling choice for our advertising customers too.
But if that’s the case, why does SMI data show a significant decline in radio’s revenue in 2023? The reason is simple: radio is a victim of its own strengths.
Beyond the snapshot
In absolute terms, the SMI data is correct, but it provides a slightly simplistic snapshot of what’s happening this year.
If we’re measuring year on year growth, we can’t ignore the massive elephant standing just out of view – those ‘abnormal’ times we all experienced. And those abnormal times have significantly contributed to this apparent anomaly.
The Government go-to
With flexible, real-time content and trusted presenters carefully curating national and regional conversations – radio is the Government’s go-to medium when crises strike.
Throughout the pandemic and beyond, the Ministry of Health’s Covid campaigns capitalised on Radio’s key strengths: powerful reach, immediacy, regionality and trust. These strengths were vital for keeping New Zealanders informed during this tough period, and so, understandably, radio revenue benefitted more than other media from the Ministry of Health response.
Delighting in double-digits
It should come as no great surprise then, that the headline numbers show a more significant drop this year. But just a little digging reveals a very different story. In fact, after adjusting for last year’s Ministry of Health spend, radio revenue has been in growth year on year for every month bar one. Growth for Q3 is in double-digits and this is projected to be even higher for Q4.
A very sound future
There’s no doubt that the last three years have been challenging for the industry as a whole, but the underlying numbers show that radio continues to deliver for audiences and advertising clients alike.
When we factor in streamed listening figures (with an incredible 6.8m** hours a week spent streaming commercial radio) and the increasing range of digital based audio options, it’s fair to conclude that the industry is decidedly well-placed to meet whatever challenges the future brings.
* GFK NZ Total Survey 2023 Survey 2, All 10+
** GFK NZ Total Survey 2023 Survey 2, All 10+ Listening on Mobile/Tablet/PC/TV or other