RadioPhillyFan said:
IIRC, in terms of revenue, Los Angeles beats NYC by a comfortable margin.
Because the demographics and markatability of LA are more appealing to advertisers.
Nope. Principally it has to do with the fact that a huge percentage of New York MSA residents commute on public transportation and thus are not reachable during commutes via radio. That affects the PUR and the "point of purchase" aspects of radio, making LA outbill NY by quite a significant margin every year since the 80's.
Market Revenue has to do with market size, market location, market demographics (ie: how much people make inside the market, would my advertisement appeal to the majority of this city) and the formats inside the city.
Ad agencies... who represent nearly 100% of the revenue for multi-market campaigns, buy markets based on client marketing campaigns. If a campaign is national, then it would likely be in Top 10 markets (30% of all radio revenue is in those 10 markets) and all top 10 markets would be included (save seasonal factors, etc.). Buys are seldom strictly format based... they are based on delivery and price. I can regale you with stories of KLVE (24 times #1 in LA in the last 30 years) getting orders with English language creative because the buyer had no idea the format was Spanish language A/C.
That's just in a nutshell, but GDP (Gross Domestic Product - which is a cities economy) is one of the lesser factors in major markets, and if it was, we'd be seeing a rise in Philly revenue (to match our GDP rise).
GDP is not a factor at all. A major difference in slightly under-indexing markets like Philadelphia, NY, Cleveland, etc., is climate. Markets like Dallas, Miami, Houston, LA, Phoenix, Atlanta over-index because they are more hospitable, all year round, to inviting folks to run over to the Best Buy or Bed Bath and Beyond and so on... because it ain't freezin' or snowin' out.
You are complicating what is really simple. Cost Per Point in the target demo. CPP. You meet the goals, and you are pretty much on the buy.
Also, pretty sure that this commercial free trend going on is affecting the market's total revenue.
No, it's not. Stations make up in other hours, days, dayparts. With radio off about 30% still compared to 2007, nobody leaves a penny on the pavement.
And those commercial free gimmicks run in every market, sometimes more, sometimes less. Doing music marathons, commercial free hours and even days is not exclusive to any market. I ran a station launch commercial free in the 60's... it's not a new idea, and it is not market-exclusive.
I want a refund.