TV Ads Continue To Slump As Money Flows To Google, Facebook

By Bob Fernandez

WWR Article Summary (tl;dr) EMarketer projects that digital platforms, Google, Facebook, and others, accounted for 43.6 percent of total media ad spending in 2016. That’s expected to grow to 56.8 percent by 2020 and 62.1 percent by 2022.

Facebook’s woes won’t help revive television advertising that is expected to decline in 2018 for the second straight year, research firm eMarketer says in a recent report.

EMarketer doesn’t expect TV advertising to rebound until 2020, and then only slightly by 0.5 percent, because of the NBC-broadcast Tokyo Summer Olympics and the presidential election.

Television advertising has been battered by the popularity of the ad-free streaming service Netflix, which has led to declines in Nielsen ratings for broadcast-TV and cable-TV ratings, and increased in targeted ads on social media and digital platforms such as Google and Facebook. Even streaming device Roku now sells ads, adding more competition for legacy television networks.

Comcast’s NBCUniversal and Fox have said they would cut their advertising load, or the number of advertisements during dramas and entertainment shows, as viewers expect a more enjoyable viewing experience, one not cluttered by a parade of ads. Comcast also has launched an advanced advertising group in New York to target television ads to audiences.

“The ad dollars follow the audience and the TV audience is declining. I don’t think there is a reason to sugarcoat this,” Paul Verna, principal analyst for video at eMarketer, said in a recent interview. “I don’t think you are looking at a dying industry,” Verna said. “We are looking at a shift.”

According to eMarketer, television advertising fell 1.5 percent in 2017 to $70.2 billion and will drop 0.5 percent this year, in addition to a 1 percent decline in 2019.

Facebook has come under attack in Washington for allowing the unauthorized use of personal data to target political ads during the 2016 election.

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