Television and digital media were responsible for driving the overall advertising market into positive territory in May, where total demand increased by 8% on a year-on-year basis.
Despite recent ratings results which suggested a lack enthusiasm for summer programming, cable TV advertising (up 6%) performed strongly in the month, however broadcast networks dipped into negative territory (-1%) when compared to 2015. On a broadcast year-to-date basis, both cable (2%) and broadcast (7%) showed solid growth.
Latest SMI data also tracked strong results in upfront and scatter. While upfront spending has risen 2% through the first eight months of the 2015-16 broadcast year (October-May), the scatter marketplace has expanded eight times that rate: +16%. Both markets grew by 5% YoY across national TV in May.
“Off the back of May’s strong results, we expect the networks to deliver very healthy upfront increases in the coming weeks. A 16% increase in scatter dollars through the first half of the broadcast year proves that advertisers are moving money back to TV after some experimentation in digital last year, which didn’t drive the results brands were hoping for,” said James Fennessy, SMI’s CEO.
“It is also fascinating to see the big slowdown in search dollars and the recognition that digital video is where a lot of the action will be happening in the coming months. Excellent new video products from both traditional and new media are capturing an increasing share of the market and we expect this to accelerate as greater and better inventory becomes available.”
In SMI’s fastest-growing sector, marketers increased their investment in digital media by 15% YoY in May, despite digital's largest category, search, declining by -10% YoY.
SMI May Ad Market Highlights
- Total television – including national TV, Spot TV, Syndication and Local MSO/Cable – rose by 4% YoY in May.
- Total TV revenues are 5% greater in this broadcast year-to-date (Oct-May) compared to 2015.
- Upfront spending on Cable TV grew by 10% YoY in May, however advertisers pulled back in broadcast, which decreased by -3% YoY. Total upfront ad investment jumped by 5% YoY.
- The scatter market also jumped by 5% YoY in May. Scatter dollars in the Cable TV market accelerated by 6% and broadcast rose by 4% compared to the same time in 2015.
- Low debut numbers for summer programming affected combined ad revenues for the top six broadcast networks, which declined -2% year-on-year.
- Univision and Telemundo were the standout performers in broadcast television during May.
- SMI data showed that Cable TV continued its strong run in May. Advertisers shifted 6% more dollars into the top 20 networks in May 2016 compared to last year.
- Advertising on video sites (55%), social media sites (44%), and ad networks/ad exchanges (28%) saw the largest YoY gains, as new players like Snapchat, YouTube and Spotify ramp up their video offerings and start to aggressively target video advertisers.
- In May, ad revenues for newspapers were down -8% YoY. SMI’s results follow a recent report that highlighted that newspapers shed 7% of their circulation in 2015, the worst year since 2010.
- Radio ad revenues recorded 13% year-on-year growth in May.
- The best performing advertiser categories for May 2016 were quick serve restaurants (36%), financial services (29%) and prescription pharmaceuticals (20%).