TVB FORWARD

Digital To Be Main Driver Of Station Ad Rev

Between now and 2020, linear ad business will be flat, according to BIA/Kelsey’s Tom Buono. Other predictions from the TVB Forward conference include Pivotal’s Brian Wieser, who says spot will grow 4.5% this year in comparison with 2015 when both the Olympics and political ad spend is excluded. Jack Myers of MyersBizNet says the strong CPM growth of between 7% and 12% for national networks during the upfront and continued strength of the scatter market is good news for local TV.

 

Total local advertising revenue is likely to grow from $146 billion in 2016 to $172 billion in 2020. That’s a 4.2% compound annual growth rate. But traditional local revenue will be flat. All the growth is coming on the digital and mobile sides, according to Tom Buono, founder of the BIA Financial Network and CEO of BIA/Kelsey, speaking at the TVB Forward conference’s forecast panel session.

Online’s 28% growth this year will ramp up to 39% in 2020. Today, online makes up only 4.8% of total TV advertising, indicating the real opportunity to ramp that up moving forward, Buono said.

Local TV is second only to direct mail in a ranking of local media sectors, he said.

Brian Wieser, senior analyst of advertising, media, Internet at Pivotal Research, forecast that spot will grow 4.5% this year in comparison with 2015 when both the Olympics and political ad spend is excluded. Next year, he sees that variation on “core” at +2.8% versus 2016.

Jack Myers, chairman of MyersBizNet, noted that the strong CPM growth of between 7% and 12% for national networks during the upfront and continued strength of the scatter market is good news for local television — especially when combined with news during the upfront that some advertisers are returning some marketing dollars to television which been diverted to digital in recent years.

Myers sees spot up 12.5% in 2016.  Looking at two subcategories of that number: legacy station revenue is expected to grow 11.8% and broadcasters’ digital revenue should be up 25%. In 2017, Myers expects total spot revenue will decline 12.4%, with legacy spot down 13.5% and digital revenue up 5%.

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Harry A. Jessell, editor and co-publisher of TVNewsCheck, noted that Kantar Media figure for total ad spend for spot during this year’s first half is up 4.3%. He believes that is to be expected, as most political spending occurs in the second half of the year. TVNewsCheck’s annual survey of stations and analysts for this year has put total ad spend at 11.5% and core (minus political) up less than 1%.

See all of TVNewsCheck’s TVB forward coverage here.


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