Magid: Local TV To Feel ‘Devastating’ Ad Impact
Research firm Magid says advertisers now plan to pull back on their broadcasting buys by 36% this year as they aggressively hoard cash. To curb the crisis, Magid says account executives need to fully understand their advertisers’ business so that they can advise them how to market — and how to use TV — through the pandemic.
Local TV advertising is expected to drop 10.6% in 2019, a non-election year, according to a new forecast by BIA Advisory Services, which sees overall local advertising growing slightly more than in its previous reports.
Department of Justice antitrust chief Makan Delrahim says that Justice will hold a two-day workshop on the impact of online advertising on the local broadcast TV market, and whether it should adjust its merger reviews given the argument that the edge is now competing for the local car dealer ads and should be considered part of the relevant competitive market.
Maximizing Local TV Ad Revenues
BIA Kelsey’s Tom Buono and Mark Fratrik discuss several areas that they believe offer near-term opportunities for TV stations, including strong economic conditions, growing online/digital advertising, social media and cross-platform advertising, political advertising, ATSC 3.0 and more.
A new report from Borrell Associates says that 68% of all businesses that buy local TV commercials plan to increase their spending on digital and mobile media in 2017. “Broadcasters need to realize that it’s their game to lose.”
Station Ad Revs Averaging 3%-4% Growth
BIA/Kelsey examined the annual revenue changes that have occurred since 1988 and those it predicts will occur through 2018 to generate a four-year moving average. By continuously averaging four years, the impact of two election years (one presidential) and two non-election years are incorporated into the prediction. The overall trend in local TV’s advertising averages is around 3%-4%. That consistency is expected to continue, which will make local television advertising a continuing, important part of the advertising mix, BIA/Kelsey says.
Exclusives
Washington, D.C.: TV Time Getting Tighter
Spending and pricing are flat but demand is rising, and it’s expected to finish up 4% to 6% this year with heavy spending for the Virginia gubernatorial election. Telecom, auto, financial, tourism and entertainment are the main categories driving the market.
Local TV’s Role In Electing A President
Leveraging the most effective media strategy is not something to be trifled with in such a high-stakes game as winning the presidency of the United States. It takes careful planning, a keen understanding of local markets and a strategic base of local broadcast television to deliver the highest prize in the land.
Phoenix was one of the markets hit hardest by the recession, which devastated the city’s once-booming real estate market. But Phoenix has also been one of the first markets to fully recover, and that has led to an active and healthy media economy heading into 2013. Auto is driving huge demand for first-quarter inventory, and if you buy at the last minute you’ll be paying a 20% to 25% premium. Radio is also healthy.
Anthony’s Pizza & Pasta, a chain with 26 franchised locations in Denver and surrounding areas, has been relying heavily on out-of-home because of its low CPMs and effectiveness at brand differentiation. But this year, the chain is switching from 90% OOH to 90% television. Moreover, it’s running nearly a dozen different spots.
PIC Media Group — the longtime seller of national 10-second TV commercials for a number of syndicated and cable TV shows — and GreenLink Networks, a local TV and social media marketer, have merged.
Advertisers that buy network TV because they presume it’s cheaper than buying spot TV, may be throwing money out the window. That’s according to a new TVB study that found that spot TV often less expensive than buying network scatter.
