Auto advertising boosts radio station revenues.

Los Angeles County radio stations in 1995 enjoyed a revenue increase of 6.2 percent over the previous year, driven mainly by local automobile dealers who revved up their advertising budgets.

A study on radio revenues conducted yearly by North Hollywood-based accounting firm Miller, Kaplan, Arase & Co. found that radio ad revenues of the major stations in the L.A. market went from $452 million in 1994 to $476 million in 1995, a 5.3-percent increase. The study is based on surveys of 22 radio stations in L.A. County.

Meanwhile, the Southern California Broadcasters Association reported a 6.2-percent gain over 1994, based on the Miller, Kaplan data combined with reports from the other 34 stations in the county. According to the Mid-Wilshire-based trade group, total radio revenues in 1995 were nearly $534 million.

"A lot of people are advertising on radio who haven't used it before," said George Mason, president of the association. "The talk shows, like Rush Limbaugh, have helped glamorize radio in the minds of a lot of media (planners at advertising agencies)."

Radio station revenues in L.A. County have risen steadily since the association began tracking them in 1980. There were only two years since then when aggregate revenues showed a decrease from the previous year, in 1991 and 1992.

Hot wheels 

Mason attributed 1995's success mainly to automotive dealers and manufacturers. Between Jan. 1 and Sept. 30, the latest period for which detailed figures are available, automotive advertising revenues for L.A. County radio were up 24.9 percent, an increase of nearly $10 million.

Some car manufacturers and dealers made extremely dramatic increases in radio ad spending. The Southern California Mitsubishi Dealers, for example, spent only $448,532 on local radio advertising during the first three quarters of 1994, but raised the ante to more than $2.4 million during the first three quarters of 1995, according to the broadcasters' association.

"Radio is a strong medium for us," said Dan White, executive director of the Santa Clarita-based Southern California Chrysler Plymouth Dealers Association. "When you can reach someone in the car, which is what you want to sell them, it's a good strategy."

White's association increased its radio advertising budget more than 200 percent in 1995, to a total of approximately $550,000, he said. The association's radio budget for 1996 is about $800,000, he added.

Radio, unlike other media, is also benefiting from growing audiences. Although individuals don't necessarily listen to the radio more often than before, no new stations can be added to the market because of federal restrictions, so population increases lead to more radio listeners, Mason explained.