- Share this article on Facebook
- Share this article on Twitter
- Share this article on Email
- Show additional share options
- Share this article on Print
- Share this article on Comment
- Share this article on Whatsapp
- Share this article on Linkedin
- Share this article on Reddit
- Share this article on Pinit
- Share this article on Tumblr
CBS Corp.’s chief research officer David Poltrack said Monday that broadcast network TV advertising revenue should grow strongly in 2016 after a flattish 2015.
Speaking at the UBS Global Media and Communications Conference in New York, he predicted that broadcast networks would see 2016 ad revenue rise 9.5 percent, or 5 percent in underlying growth adjusted for Rio de Janeiro Summer Olympics spending. “We might even see double-digit growth,” which would be the first such gain since 2004, he said, acknowledging that this will be seen as a contrarian and bullish forecast.
Poltrack also predicted growth in consumer and marketing spending and other positive economic trends helping ad momentum, along with the chance to win dollars from top cable networks that have seen ratings declines. “2016 stands to be a very strong year” for the broadcast networks, he summarized.
A year ago, Poltrack had predicted that broadcast ad revenue would remain “stable but not growing” through at least mid-2015. Overall, he had projected flattish advertising revenue in 2015, or growth of 2 percent on an underlying basis when adjusting data for the Olympics boost in 2014.
On Monday, Poltrack said that broadcast networks ad revenue has been improving in every quarter of 2015, meaning final figures should be close to what he had predicted for the year. He confirmed strong scatter ad market trends and his forecast.
For 2016, the strong scatter market likely will mean “a strong upfront,” Poltrack added.
The research guru said he continues to believe in the preeminence of broadcast TV, adding, “I see nothing on the horizon that will threaten that preeminence.”
Poltrack focused a portion of his presentation specifically addressing the benefits of digital versus TV ads. While TV still commands the lion’s share of the global ad pie, digital has been growing steadily, and ad forecasters Monday morning said digital will overtake TV as the biggest ad category in the coming years. Digital should overtake TV by the end of 2017 globally, and in 2016 in the U.S., according to Magna Global.
Poltrack said that advertisers “are refocusing on the central role of television advertising” in their marketing plans. And he argued that TV is all about reach, not efficiency, saying efficiency-focused digital-centric approaches that have become more popular have at times failed. “Change is now underway,” he said.
Poltrack said digital’s reach was less than TV’s and that “digital campaigns work better when supported by strong broadcast campaigns.” He presented data supporting his comments and concluded that the last thing an advertiser should do is “using TV dollars to fund its digital efforts.”
About fall TV season trends, Poltrack said it was likely there would be make-goods for networks based on trends so far. But he said any make-goods should be manageable because less upfront inventory was sold. NBC and Fox are in line with last year’s performance this fall season, while ABC is down, he said.
Here are some other nuggets from Poltrack’s popular annual presentation:
* Netflix homes in the U.S. are now at 42 percent versus 36 percent last year, up half as much as last year.
* CBS primetime shows this season have a total audience across platforms of 13.8 million, up from 13.3 million 10 years ago.
* In 2011, 47 percent of new shows were discovered via live linear TV viewing. In 2015, this figure has fallen to 36 percent.
* Younger viewers are moving away from DVR viewing to VOD and streaming video, while people age 50 and older are showing increased DVR usage.
* Broadcast-only homes without Internet now account for 5.2 percent of U.S. households, versus 4.6 percent last year. “That is good for broadcasters” as they are losing cable competition and have no new Internet competition, Poltrack said.
Sign up for THR news straight to your inbox every day
State of the Union