Saga Communications, a stalwart of the traditional radio landscape, painted a picture of resilience amidst industry headwinds during its recent Q1 2024 earnings call. While the company acknowledged a "subpar" performance with revenue down 2.5%, CEO Chris Forgy emphasized a forward-looking strategy, boldly declaring, "radio isn't broken, it's just slowing down." But beneath the surface of this seemingly standard earnings report, a fascinating narrative unfolds – one that hints at Saga's quiet ambition to become a significant player in the digital arena.

Forgy's call to action wasn't simply a defense of traditional radio, but a calculated articulation of how Saga intends to leverage its deep understanding of radio audiences to navigate the digital landscape. He highlighted the industry's challenge of capturing a greater share of the advertising pie, noting that radio stations, even with dominant market share, often receive less than 3% of total ad spend. This stark reality, he argued, puts "all of our 7% at risk."

The solution? To engage in the "60% discussion" – a direct reference to the significant portion of advertisers' budgets currently allocated to digital advertising. Saga isn't aiming to become a "digital company," Forgy clarified, but rather to equip its sellers with the skills and tools to compete for this larger pool of advertising dollars. The company's recent rebranding of its radio station groups to "media groups" and its renaming of sellers to "media advisors" underscore this strategic shift.

"Beyond mere semantics, Saga is backing up its rhetoric with concrete initiatives. The company has been aggressively investing in digital revenue streams, including e-commerce, streaming, and online news services. CFO Sam Bush highlighted impressive year-over-year growth in these areas, with e-commerce revenue up a staggering 249% in Q1 2024. These aren't isolated wins. Saga's trailing twelve month (TTM) e-commerce revenue reached nearly $2 million, with April 2024 marking a record high. Similarly, streaming revenue has been on a steady upward trajectory, achieving a TTM of $4.8 million and also hitting a record in April."

The online news service, launched in 18 markets by the end of Q2 2024, has already generated over $1 million in pre-booked revenue for the year. This rapid deployment and early revenue generation suggest a carefully planned and well-executed strategy.

Saga's Digital Revenue Growth

The following chart illustrates the projected growth of Saga's digital revenue as a percentage of total revenue. While the company aims for 11%, the actual growth could be even more significant.

This data, coupled with Saga's strategic focus on digital revenue and its investment in talent and technology, suggests that the company is not just reacting to industry trends, but actively shaping its own digital future. While smaller broadcasters are struggling to keep pace with the digital revolution, Saga appears to be quietly building a digital powerhouse, poised to capture a significant portion of the 60% pie.

"**Fun Fact:** Did you know that Saga Communications was founded by the late Ed Christian, a broadcasting legend who started his career as a radio announcer at the age of 16?"

This quiet, family-run company, headquartered in Grosse Pointe Farms, Michigan, has a long history of innovation and a knack for defying industry trends. The question now is whether Saga's bold digital strategy will usher in a new era of growth, not just for the company, but for the radio industry as a whole.