Spot: Booming with record political dollars
New forecast predicts 10 percent gain for local TV
October 11, 2012
While print continues to struggle and growth in other traditional media is meager, spot television is cruising to a very good year.
The huge number of political dollars flowing to the medium, along with an anticipated bump in end-of-year bookings from retailers eager to reach holiday shoppers, will increase spot TV spending by 10 percent this year, according to a new forecast.
Revenue will increase to $20.3 billion this year, according to BIA/Kelsey, the Chantilly, Va., local media consulting and research firm. Last year spot brought in $18.437 billion.
Over-the-air TV spending will account for most of that money, $19.7 billion, up from $17.902 billion last year.
Digital revenue, though accounting for only a small portion of spot spending, will see stronger growth, up 14.9 percent this year from $525 million in 2011 to $615 million.
The total gains will be powered by political, which will infuse more than $3 billion into local TV station’s coffers by the end of the election period, according to the latest estimates from Wells Fargo.
That’s way up over the estimated $2.1 billion spent during the 2008 presidential campaign on spot television.
Though local cable has also been seeing notable gains, candidates continue to feel most comfortable putting their money in local broadcast.
It remains the best way to reach a wide swath of people with a single buy, because even at a time of declining ratings, broadcast still draws the largest audiences of any media.
The spot TV outlook was by far the most optimistic part of BIA/Kelsey’s most recent forecast for traditional media.
It revised its prediction slightly downward for radio, though it still foresees growth of 2.2 percent, to $14.868 billion this year.
Over the air ads will be up just 1.9 percent, from $14.115 billion to $14.377 billion.
Online, as is the pattern, will see a much bigger jump, 12.1 percent, going from $438 million to $491 million.
Buyers have noted, over the past few months, that radio is not seeing as much political spending as many had anticipated earlier this year.
It is still getting some spillover from spot television, with non-political advertisers being squeezed out by campaign and super political action committee spending taking refuge on radio.
The outlook is even drearier for newspapers. Unlike Borrell Associates, which recently predicted a 0.5 percent increase for newspaper print ad revenue next year, BIA/Kelsey doesn’t see much potential in print.
It’s predicting a decrease of 8.1 percent in newspaper revenue this year, including a print decline of 10 percent and online growth of 5 percent.
That’s bigger than the 5 percent dip BIA/Kelsey had predicted earlier this year, the company notes, because newspaper results so far in 2012 have been more disappointing than expected.
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