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TV Ad Spend Jumps as Digital’s March Slows

May 24th 2016

New York, 23rd May 2016 – Heading into this year’s upfront television negotiations, national TV advertisers have invested 6% more dollars in April than they did in the same month in 2015 – a promising sign for both cable and broadcast networks even as TV viewership continues to slide, according to Standard Media Index’s (SMI) latest data.

SMI’s data showed that cable TV revenues swelled by 7% in April compared to 2015 and broadcast TV recorded a 6% spike for the month. So far this broadcast year, TV has gained 6% compared to its 2015 results, and some analysts suggest that commitments for the upcoming upfront could increase by 3% to 5%.

Digital media revenues rose by 15% YoY in April 2016, though the sector grew at a significantly slower rate than in previous months. Advertising on social media sites, video sites and ad networks/ad exchanges saw the largest YoY gains in the sector.

SMI’s data echoes current market sentiment that more and more digital advertiser dollars are creeping back to TV – reversing trends of the past few years.

“SMI’s April data continues to show the reemergence of TV as the industry’s strongest and most effective medium. We have seen digital’s growth slow over the past few months and know from feedback from advertisers and agencies that television is still the best place to find high quality, guaranteed audiences at scale,” said James Fennessy, SMI’s CEO. “Timing couldn’t be better for the major networks as a strong scatter market again in April should ensure they book healthy increases in the upfronts over the coming weeks.”

SMI APRIL AD MARKET HIGHLIGHTS

  • The total market’s revenues jumped by 7% in April when compared to the same month in 2015.
  • Total television – including national TV, Spot TV, Syndication and Local MSO/Cable – rose by 5% YoY in April.
  • The upfront market performed strongly in April. Ad investment spiked by 9% YoY, driven by cable’s 10% YoY growth and broadcast’s 7% YoY increase.
  • The scatter market turned out a strong result (8%) in April. Broadcast spending stayed relatively flat but cable TV scatter accelerated by 13% compared to the same time in 2015.
  • Despite being under ratings pressure, the top six broadcast networks rose a combined 6% YoY in April 2016. Fox led the pack for the month with a big double-digit percentage increase and the other major English-language broadcasters also enjoyed solid year-on-year growth.
  • Despite some ad spend wins, recent reports said overall TV viewership erosion stands at a 4% decline in April.
  • Cable TV had a relative bounce back in April. Advertisers shifted 7% more dollars into the top 20 networks in April 2016 compared to last year.
  • There were a number of robust year-on-year increases across cable networks. Key performers were ESPN, AMC, HGTV and Bravo which attracted big double digit gains.
  • Looking at TV’s market share in April, the sector currently represents 54.2% of the advertising total pie, having dropped by 2.5 percentage points from April 2015.
  • SMI’s data recorded a 12% year-on-year boost for the out of home sector in April 2016, a solid result for a sector whose growth has slowed significantly in the year to date.
  • Print media recorded some losses April. The total market fell by -9% YoY. Newspaper (including digital newspapers) spending dropped -11% YoY while the magazine sector (including digital) fell by -4% in the past month.
  • Radio ad volumes stayed flat in April however total revenues remain down by -12% in year-on-year comparison in the 2016 year to date.
  • The best performing advertiser categories for April 2016 were quick serve restaurants (44%), prescription pharmaceuticals (34%) and automotive vehicles and dealerships (22%).
  • SMI’s latest data shows that retail advertising remains strong (up 11%), despite major department store Macy’s recently announcing that consumers had put the brakes on spending mid-March, forcing it to cut its sales and earnings forecast for the year.Media Type – Media Sub Type- April YoY GrowthTelevision
  • Cable TV 7%
  • Broadcast TV 6%
  • Spot TV -10%
  • Syndication 13%
  • Local/MSO Cable 6%
  • Television Total 5%

Digital Pure Play – Content/Search 2% Ad Network/Ad Exchange 27% TV Network – Digital -5% Print – Digital 8% Pure Play – Video 32% Pure Play – Social 59% * Pure Play – Internet Radio 14%

  • Magazines Total -5%
  • Digital Total 15%
  • Newspapers Total -16%
  • Radio Total -1%
  • Out of Home Total 12%
  • Grand Total 7%

Scatter Broadcast 1% Cable TV 13% * Scatter Total 8%

Upfront Broadcast TV 7% Cable TV 10% * Upfront Total 9%

SMI captures 80% of total U.S. agency spend exclusively from the booking systems of five of the six global media holding groups, as well as leading independents. It reports monthly on actual spend data and is the clearest picture of the flow of dollars across the sector.

SMI Team

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