Tegna’s Big Markets Outperforming Small Ones

While the traditional top ad segments of auto and retail may be a little soft this year, Tegna President-CEO Dave Lougee says others are picking up the slack and demand is broadening. “So we have less dependence on auto than we once did,” he noted in his quarterly conference call with Wall Street analysts.

“We do see improvement in a lot of categories, especially insurance, which has been increasing all year by a significant amount. Media and telecom are all up. Medical, dental, services. These are all categories that are up major double digits,” Lougee told the analysts. “And with not many down categories,” he added.

The third quarter was sequentially better than the second, the CEO noted. “Auto and retail remained down, but only marginally, in low single digits. Retail’s actually hanging in there — just below down. And in fourth quarter I think auto will probably end up for us even a little up,” Lougee said, crediting that partly to political ad displacement in 2018.

One analyst wanted to know whether Tegna is seeing a difference in advertising demand between its large market stations and those in smaller markets. The answer is yes.

“In our case, we are,” said Lougee. “We’re doing better in our larger markets, with local being specifically strong.” He noted that is especially true in Texas. Tegna has a large portion of its station portfolio in the Lone Star State. “Texas is performing really, really strong, and that is driven by the large markets,” Lougee said.

Like other station groups, Tegna is anticipating record political revenues in 2020. Lougee declined to offer any projected dollar figures, but he is bullish on what lies ahead in the election year.

As that windfall approaches, Tegna has integrated its in-house national rep’s political sales operation with the Premion OTT sales effort. And while he can’t predict the size of next year’s political sales, Lougee noted that the targeting of OTT advertising is attractive to political campaigns. Premion, he said, is “in the right place at the right time.”