Standard Media Index (SMI), the advertising intelligence company bringing clarity to the ad industry, today unveiled updated advertising revenue figures for October 2017. In October 2017, the total advertising market was up +7%, thanks to continued investment in Digital which saw a +11% more spend, a +16% spike in Radio and a small +1% increase in National Television. Looking at the ad market year-to-date (Jan. – Oct. 2017), the overall advertising industry is still trending positive with +4% more spend than Jan. – Oct. 2016.
Out-of-Home, Magazines, and Newspapers, all saw their ad revenue decline — -3%, -19% and -3%, respectively.
With advertising conversations mainly on Digital and Television, Radio often doesn’t get discussed. Advertisers, however, have not forgotten about it with a +16% increase YoY. This is the 5 thmonth in a row that Radio has seen a YoY increase in spend, but year-to-date that medium is still down around -1%. Historically, November and December have been where advertisers spend the most on Radio. If that trend continues, Radio would end the year on a positive note. Telecommunications, Auto and Financial Insurance all contributed double-digit increases to help radio see such positive growth in October 2017.
In October 2017, the National TV market was up +1%, with Cable seeing a +3% increase. Broadcast, on the other hand, declined by -2%. As we get closer to the end of the year, we also looked at the market year-to-date or Jan-October. The National TV market is down -3% from the same time period in 2016. Cable is registering a -2.5% decline, while Broadcast is seeing a -5% decline.
The decline in advertising on Broadcast stems from a decrease in Sports and News programing, -3% and -18%, respectively. Entertainment programming saw a +3% increase. The decline in Sports mostly stems from less spend on College Football. This does not, however, reflect less interest in the sport, it has to do with the way the calendar fell. In October 2016 there were five Saturdays – the day most College Football games on broadcast are played. In October 2017, there was only four.
It’s quite expected to finally see a drop in spending around news. When you look at October 2016 versus October 2017, last year we were in the height of the election and Americans were glued to their TV. CBS, interestingly, is the only network to see an increase in spending around News programming with a +6% increase. This is mostly due to more spend on CBS Sunday Morning and Face the Nation.
Looking at Entertainment shows across the four big broadcast networks three of them saw increases – NBC registered the largest YoY jump at +14%, CBS saw a +2% increase and ABC was up just +1%, across all Entertainment programs across all dayparts. FOX, however, saw a decline of -6%. This decrease comes from lower unit costs across key shows like Empire, Lethal Weapon and Lucifer, and one less showing of Gotham, compared to the previous year. The network also lost revenue it had in October 2016 that came from the special Rocky Horror Picture Show it aired. Combining the big four together – Entertainment programs across all dayparts saw a +4% increase, YoY in October 2017.
NBC’s colossal increase comes from its Tuesday Night Lineup of The Voice, This Is Us, and Law & Order True Crime: The Menendez Murders. This is partially because all three shows are doing well but, it’s also because their best night of TV, happened to have one extra night to shine in October 2017 compared to October 2016, with one extra Tuesday in the month versus last October. Because of this, and other scheduling changes, This Is Us had 5 episodes in October 2017, compared to 3 in October 2016.
Both ABC and CBS benefitted from the extra Tuesday as well, but to a much lesser degree. For ABC, its Thursday Night Lineup continues to be its strongest – having Scandal in the mix, which did not air in October 2016, has helped the network see a slight increase. For CBS, NCIS and NCIS alumni are the shining stars with NCIS, Bull and NCIS: New Orleans taking the top three spots in terms of revenue earning shows for the network. While the extra Tuesday helped propel these three into the top spots, outside of The Big Bang Theory, NCSI and Bull, also have some of the highest unit costs on the network.
Speaking of unit costs, the average unit cost on an Entertainment Prime Time show across the big four networks decreased -4% from $116,600 in October 2016 to $111,700 in October 2017.
Cable’s increase comes from an uptick in spend across all three major genres. News saw the largest increase with +6%, followed by Sports which grew +5%, and Entertainment which grew by +3%.
Looking at growth by network – ESPN was flat, TBS saw a small -2% decrease, HGTV grew by +6% with revenue increases from Fixer Upper, House Hunters and Love it or Leave it, and USA Network grew by +4% thanks to an increase around WWE Smackdown, as well overall increases on its syndicated programs. AMC also saw a +20% bump YoY thanks to The Walking Dead. While ratings have been slipping the network had three “specials” ahead of this year’s premiere helping to increase revenue overall
The Auto industry continued to decrease advertising in October 2017 with -8% less spend on National Television advertising than in October 2017. All of this decline comes from Broadcast, which saw -12% less spend. Auto spend on Cable was flat seeing a marginal +0.3% increase. Much of Auto’s decline on Broadcast comes around College Football, which saw less spend overall, as mentioned above. Other industries to see a decline in advertising spend include Entertainment which saw -14% and Telecommunications which saw -10%.
Pharma-Prescriptions continued to increase spend on National Television with +4% more spend than in October 2017. Insurance saw a +20% increase, and Food, Produce and Dairy increased advertising spend by +9%.