Audio is among the most-profitable media for advertisers and delivers notably higher profit-ROI than the all-media average, both short-term and full-term.
That is the standout conclusion of a new analysis carried out by WPP Media for Radiocentre, which also reveals how reallocating existing media spend and maximising audio’s share to exploit fully its marginal ROI headroom, can amplify total campaign short-term ROI by 8% compared to the same media spend with no audio included in the mix.
The ‘High Gain Audio’ research reveals for the first time that when broken out individually, broadcast radio and digital audio each significantly outperform the all-media profit ROI average, whether campaigns are focused on demand-generation or demand-conversion.
Digital audio delivers a full-term profit return of £5.20 for every pound spent, while broadcast radio delivers a £5 return. This compares to the all-media average of £4.11.
It is a similar picture for short-term profit ROI, with digital audio returning £2.70 and broadcast radio £2.30 for every £1 spent, both exceeding the all-media average of £1.87. In addition to this positive outcome compared to other media, these results also support digital audio’s price premium relative to broadcast radio.
Radiocentre planning director Mark Barber said: “High Gain Audio’s key takeaway is clear: multiplatform audio advertising is underinvested, with both broadcast radio and digital audio individually exceeding the all-media profit ROI average. These findings build on previous Radiocentre research to strengthen the case for advertisers to be more ambitious with their multiplatform audio budget allocation.
“That’s why, based on the outputs from this analysis, and acknowledging that each individual media campaign will have its unique set of dynamics to accommodate, we’re advocating that, to benefit more fully from its amplification effect on overall campaign ROI, advertisers consider setting a new horizon where 20% of total media spend is allocated to audio.”
High Gain Audio is based on robust data from Thinkbox’s award-winning Profit Ability 2 study, alongside additional analysis by WPP Media using a multiplatform audio dataset of WPP Media campaigns.
It is designed to address a demand in the advertising industry for more nuanced evidence into audio’s impact on campaign ROI, supporting the case for investing more in audio advertising as audiences rapidly grow (with commercial audio audiences growing 23% in the last five years alone).
The study explores how ROI performance varies between broadcast radio and digital audio, both individually and combined, in comparison to other media. Additionally, it investigates how different budget splits between the two formats and other media affect performance, while also assessing the impact of increasing and decreasing levels of investment.
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