Analyst Cuts 2015 TV Ad Growth Outlook - Broadcasting & Cable

Analyst Cuts 2015 TV Ad Growth Outlook

Lower ratings, shift to digital raise concerns
Author:
Publish date:

Analyst Brian Wieser of Pivotal Research says advertising revenue growth in 2015 will be weaker than previously forecast.

In a new report, Wieser sees TV growing at just 1.4%, with cable up 3.3% and broadcast down 1.7%. Back in June, he'd forecast a 4.1% increase for TV.

"Reported audience declines certainly aren't helping, as there could be some risk that inventory guarantees made at the time of the most recent upfront go unmet. If they continue into next year, our estimates may still prove to be too optimistic," Wieser says in his report.

The broadcast and cable networks aren't helping themselves. "We think the television industry itself is generally failing to create the conditions whereby large brand marketers or agencies willingly champion the medium publicly," Wieser said.

For one thing advertisers measure themselves against direct competitors, which means they can maintain their share of voice even as spending declines. At the same time, Wieser says "recent conditions have produced a genuine willingness among most marketers to at least consider placing their TV budgets with the Googles, Facebooks, Yahoos and AOLs of the world, even if they aren't doing much at this point in time."

All of which makes Wieser more conservative in the longer term. He's now forecasts that national TV growth from 2014 through 2019 will be 3.1% versus the 3.7% compounded annual growth rate previously expected.

(Photo via Ervins Strauhmanis's FlickrImage taken on Sept. 19, 2014 and used per Creative Commons 2.0 license. The photo was cropped to fit 3x4 aspect ratio.)

Related