TV and OOH Take Dollars from Digital in First Month of 2017February 24th 2017
New York, 23rd Feb 2017 – Standard Media Index (SMI), the company providing the only complete and clear picture of real advertising cost and spend, today unveiled updated figures for January 2017. SMI total market closed January 2017 with +5 percent increase on a year-on-year basis. Spend for the month was the highest volume of spend recorded for a January since SMI started tracking spend in 2009, highlighting that the ad market continues to be quite healthy.
DIGITAL AD SPEND CONTINUES TO SEE GROWTH SLOW
For the second month in a row, advertising spend on digital platforms only saw single digit growth compared to the same time period in 2016. The +6.3 percent increase is in stark comparison to the 15-20 percent growth rates the industry had become accustomed to at the beginning of 2016. SMI began seeing this trend toward the end of last year, and based on January spend, it’s clear that the industry is in the middle of another shift – this time back to more traditional advertising.
OUT-OF-HOME TRANSFORMATION DRIVES UP REVENUE
Digital’s slower than expected growth is compounded by a resurgence in out-of-home advertising which saw +9.7 percent growth in January 2017 fueled by +43 percent growth from telecommunication companies and triple digit growth in spend from consumer electronics and quick serve restaurants. Much of January’s overall increase can be attributed to Billboards which grew +29 percent in the month. This growth in OOH follows three straight quarters of growth in 2016, and +115 percent increase in spend from automotive companies on the year.
TELEVISION IS FAR FROM DEAD
Overall, the January 2017 television market saw a +5.7 percent increase – continuing the upward trend SMI saw in 2016. Cable accounted for a bulk of the increase with +8.2 percent year-over-year in January while Broadcast saw +2.8 percent increase on the year. When you exclude sports programming, Broadcast TV remained flat with just +0.2 percent growth on the year but Cable remains strong with +7.5 percent increase thanks to an increase in spend on entertainment and news programming, +5.9 percent and +16.8 percent, respectively.
Conversely, when you break out just sports programming Broadcast increased spend by +6.3 percent and Cable grew by +11.1 percent. Again, highlighting that sports programming, and especially live sports, is what is fueling TV industry growth. Unsurprisingly, on its own, entertainment programming declined by -1.6 percent in broadcast and only grew +2.9 percent overall in National Television market.
“SMI’s latest data reflects the fact that leading marketers, including Coke and P&G, have firmly come to the conclusion that linear TV is still the powerhouse of ROI. A lot of digital experimentation last year didn’t deliver the expected results and advertisers are flooding back to tried and trusted mediums, and that includes Out of Home which is going through a real renaissance,” says James Fennessy, CEO of SMI. “Digital’s growth continues to slow and when removing Google and Facebook from the equation we see the sector delivering an anemic growth rate of just 2 percent. The NFL was the savior for Broadcast with the new president continuing to deliver big time for the cable news networks.”
National Advertising Market Gains 7% in October
The national advertising marketplace grew 7% in October 2018 year-over-year (YoY). National linear TV was flat.
National Television Maintained YoY Revenue for 2017-18 Broadcast Season
Data from the new and improved AccuTV shows that during the full 2017-18 Broadcast Season, excluding the quadrennial Winter Olympics and World Cup, National TV maintained revenue of $45.5 Billion. This is the same as the prior year, despite declining audiences and continued pressure from Digital.