Radio industry executives said yesterday that they were hopeful of an improvement in the ad market next year.
This year has been challenging for radio advertising — as well as television and newspaper advertising — and it has not helped that GCap, the industry leader andowner of Capital Radio and Classic FM, has been suffering on many levels.
Fru Hazlitt, the chief executive of Virgin Radio, said: “Next year we could start seeing an upturn). Traditional advertising as a model will always find a way . . . The radio market is led by GCap, and it is starting to say the right things.”
Ms Hazlitt said that although next year could remain challenging for the industry, she was looking towards improvement.
She noted that more positive sentiment emanating from GCap in recent weeks could mean a better 2007 for the group, which, she added, could lead to a better year for the rest of the industry.
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Zenith Optimedia, the media buying agency, is also predicting a more positive future for radio advertising in the coming year. It is expecting radio revenues to be up by 0.9 per cent in 2007 and up by 1.8 per cent in 2008. The agency said that radio advertising fell 2 per cent this year.
Richard Wheatly, the chief executive of The Local Radio Company (TLRC), is also hopeful the radio advertising market will do better in 2007. He said: “Radio advertising might start to see signs of recovery in 2007. We need the industry leader [GCap] to get its act sorted out.”
Mr Wheatly noted that 2006 has been a particularly difficult year for TLRC, but he said that he was bullish about 2007. The radio company said yesterday that it had raised £2.8 million after expenses through the placing of 15.8 million shares at 19p and said that it expected full-year results to be in line with market forecasts.
This week the Hallwood Group, a Dallas-based investment company that has numerous holdings in oil and gas exploration, took a 23.1 per cent stake in TLRC.
The radio company said that although it did not expect an upturn in the advertising market in the immediate future, it expected October and November to produce the best monthly trading results of the year.