Move To Impressions-Based Measurement, Sports Betting Brighten ’22 Outlook

Over the past year, the local broadcast TV market saw many exciting advancements across a range of areas, including increased adoption of impressions-based audience measurement, the rapid rise of the sports betting category and, despite the auto industry’s ongoing challenges due to the supply chain, the continued rebound of auto advertising. And looking ahead to the new year, the outlook is bright.

The steady, industrywide embrace of impressions-based measurement certainly made for plenty of news, with several large station owners backing the currency for the buying and selling of local TV advertising. Meanwhile, Nielsen said it would provide further support to the shift by making impressions the default in all its systems starting in the New Year.

Even as the number of media platforms continues to grow, broadcast TV maintains its dominance. The GfK TVB 2021 Media Comparisons Study found that while ad-free streamers spend more time streaming content than the average adult, linear TV still leads the way. Broadcast TV also has the highest reach among ad-free streamers compared to all other platforms. The study also found that five times as many consumers view programs with ads on linear TV screens versus smartphones.

Another TVB study this year confirmed that TV and sports betting are a winning combination. According to BIA Advisory Services, online gambling ad spending on local broadcast TV is projected to hit $445.3 million in 2021 and $570.7 million in 2022. The study found that TV is the most important sports betting influencer for awareness, consideration and placing bets.

The supply chain continued to create a strain on the auto industry in 2021, with more than 11 worldwide production cuts due to microchip shortages, leading to sales forecasts being slashed and dealer new vehicle inventory at record lows. That has led to a “new normal” for dealers, one in which vehicle prices are higher (up 9% versus 2020) and incentives at a record low ($1,888). It’s also led to record profits for dealers, according to TVB auto analyst Steve Sturm, with the average dealership pre-tax profit in the first nine months of this year running at $3 million versus $1.3 million in 2020. The average per-vehicle gross profit in November was up 69% versus last year according to JD Powers, Cox Automotive, True Car, Automotive News and Ward Automotive.

Dealerships have invested much of that profit in local TV ads, which continue to be a mainstay for the industry. Spot TV advertising was up 8% the first nine months of the year versus 2020 as automakers and dealers continue branding to stay competitive.

As for what’s ahead in the new year, the local TV market will continue to be active, with trust in the medium thriving and revenues on track — due in part to anticipated spending on political ads due to the looming midterm elections. Sports betting, auto, political and home improvement are categories that will drive TV stations’ fortunes in 2022. We can expect further consolidations among broadcast groups as well. Meanwhile, the tremendous growth of OTT ad spend shows no sign of slowing down in 2022, as viewership soars and as broadcasters continue to refine their streaming offerings.

Steve Lanzano is president and CEO of TVB.