BIA Forecasts $12.3B In Local Radio Revenue

BIA Advisory Services, in partnership with the Radio Advertising Bureau (RAB), has projected that U.S. local radio advertising revenue will reach $12.3 billion in 2025.

This figure encompasses both over-the-air (OTA) broadcasts and digital radio platforms, positioning local radio as the fifth-largest advertising medium in the broader $171 billion U.S. local ad market. The forecast represents a slight downward adjustment from earlier 2024 estimates, reflecting economic uncertainties like tariffs and political factors, but it underscores radio's resilience amid a shifting media landscape where digital ad spending is expected to surpass traditional media for the first time (excluding political ads).

The $12.3 billion projection includes a mix of declining OTA revenue and modest digital growth:

Over-the-Air (OTA) Radio: Expected to account for approximately $10 billion, down about 6% from 2024's $10.6 billion due to ongoing shifts toward digital alternatives.
Digital Radio: Projected at around $2.4 billion, with a slight increase of 0.1% to 4.5% year-over-year, driven by sectors like financial services, insurance, and quick-service restaurants (each investing over $95 million). 

Overall, combined OTA and digital revenue is forecasted to dip by about 4.9% from 2024's $13 billion.This hybrid model highlights radio's adaptation, with digital extensions (e.g., streaming and podcasts) helping offset OTA losses.

Key Growth Drivers and Categories:  Several verticals are fueling radio's ad investments, with BIA identifying opportunities in the "Three Rs" (Restaurants, Retail, Real Estate) plus emerging sectors like Automotive and Education. Here's a summary of top projected spenders:

Political advertising will provide a boost in an off-election year, particularly in markets with special elections and gubernatorial races. Hospitals stand out as a "notable" top spender, per BIA VP Celine Matthiessen, signaling opportunities for radio to bundle audio with emerging digital formats.