Audio Advertising Battle Royale: AM/FM vs. Ad-Supported Streaming

Think about those old westerns, in which the cowboys would resign themselves to a duel.

What makes it thrilling and a timeless trope in movies and literature, is that it’s a crossroads of equal measures versus one very unequal outcome (i.e., some hombre not making it to dinner that night because the town isn't big enough for the both of them).

Audio, and particularly audio marketing, is really in a similar type of duel(s) in the 2020s. The demise of radio has been reported far and wide, but if there’s any lesson we’ve already learned this decade, it’s that identifying truth is awfully difficult.

But it did get a lot easier, thanks to an enormous study by Edison Research. A titan of audio statistics and analytics, Edison Research just released a four-part Weekly Insights series that highlights how mediums compare to one another.

And there is much to infer from it.  So let’s dive in to gather where the most ears turn most of the time.

Ages 25-54: The Advertiser’s Goldmine

Look, if you deal with a product or service meant for the elderly, this study won’t mean much to you. But for most businesses, this demographic stands above all others. In it are three crucial demographics: Gen Z, millennials, and Gen X. All of whom are almost certainly to be active spenders (i.e. not elderly, college students or late teens).

That AM/FM radio takes even a slight majority of listenership compared to ad-supported streaming, for this prized demographic, is bonkers. And even to the most ardent radio heads, it may even be surprising. Who knows what the future holds with AI looming large, but with a 31-year age window, the odds of AM/FM relinquishing top dog status is unlikely.

Radio: Simple Yet Effective

It’s anecdotal, sure, but I had to stop using spotify. Glitches here, missing episodes there. The juice wasn’t worth the squeeze required to consume the content I wanted, and I said enough.

It’s a safe bet that is a factor across the U.S. as well. Radio’s just trustworthy. You know what you’re gonna get, whether it’s the on-air talent you like, or the type of programming available as long as you are able to obtain a signal. It should be noted, this study is not accounting for subscription-based streaming, as that means ads are not present.

Think of radio like audio comfort food. Whereas with streaming platforms there is an array of things waiting to go wrong or technical barriers to access, radio always just delivers, even if what it’s delivering may not always be long-form or in-depth.

Yet, Radio Has Evolved

There is a smaller misconception within the radio-is-dead one, that it is relegated to the car. Afraid not.

AM/FM has penetrated homes and smart devices galore. This speaks to radio’s flexibility, and ability to be brought wherever we go. There is no doubt that had radio been stagnant and ignored home and device adaptation, ad-supported streaming audio would be head honcho. What ultimately makes radio’s firm grasp even more impressive, is that as all of audio has evolved, ad-supported streaming includes music and podcasts…and still clocks in behind the gold standard, radio.

Streaming Services: More Than a Fad, but not the Expected Boom

Another notable finding is that ad-supported streaming audio services such as Pandora and Spotify have not gained significant popularity among the 25-54 age group. This could be attributed to the fact that listeners in this age group are more likely to have disposable income and are willing to pay for ad-free listening experiences. 

Moreover, the study suggests that streaming audio services may have hit a saturation point in terms of adoption. This implies that even though the market is growing, the growth rate is not as significant as it was in the past. This could be a challenge for streaming audio services as they may need to find new ways to attract and retain customers.

Money Spent on Radio Advertising is Money Perfectly Spent

Edison said it beautifully. Because of the unique combination of history and adaptation, “we have to think of radio as a product, not just a device”. It’s a product with which any business can and should thrive . We experience these types of successes daily, and seeing our passion for good local radio bring unprecedented success to our community businesses, is a dream that never gets old.

If you’d like to join the hundreds of Idaho businesses dominating competition thanks to the intrusive power of Iliad Media Group’s top-rated stations, it’d make our day to chat. After all, you’ll fare much better than going anywhere near streaming.