Television dominated the Government/Political/Religion (“GPR”) vertical in 2012, according to BIA/Kelsey’s Media Ad View Plus. In 2012, television’s $3.1 billion of advertising from GPR represented nearly 3/4 of total advertising for this vertical.

2012 Government/Political/Religion Ad Spending by Media

The $3.1 billion of GPR advertising represented 15% of the television media’s total ad spend in 2012, with the vast majority of it coming in the Fall (September to November), based on information from the Television Bureau of Advertising (TVB). TVB has studied the spending patterns in the political category for the past several election cycles. The vast majority of political spending occurs in the Fall (September to November), with the exception of primaries, which provide some advertising revenue from January to September, at least in markets within battleground states. “Clearly local TV’s role as the campaign media workhorse has not changed” states the TVB about the 2012 election season.

GPR advertising is cyclical, peaking during big national and local elections, which occur during even years. The more hotly contested the elections are, the better for local television stations. In 2017, an odd year with no major political elections, the GPR advertising landscape is vastly different, with only 19% of GPR advertising revenue going to television. More GPR advertising revenue will be going to direct mail than television in 2017, according to Media Ad View Plus. In odd years, such as 2017, GPR is dominated by smaller local elections, which rely more on direct mail to get their message to voters in their districts rather than advertise to entire television markets.

2017 Government/Political/Religion Ad Spending by Media

The bounty that can be GPR revenue during the even years is not equal across the 210 Nielsen television markets. Markets located in battleground states will see greater GPR advertising spend than markets in states that are heavily red or blue. States such as Ohio, Virginia and Florida have become predictable battlegrounds states. These so called “purple” states see boosts during even years, with the Presidential, Senate and House races.

More information on BIA/Kelsey’s Media Ad View Plus is available here.

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In 2012, television dominated both the Automotive advertising and Government/Political/Religion (“GPR”) verticals, according to BIA/Kelsey’s Media Ad View Plus. More on the GPR vertical later.

Television’s $4.6 billion share of automotive advertising represented 28.4% of total automotive advertising in 2012. This $4.6 billion represents 22% of television’s total advertising revenue in 2012, making it the highest spending vertical for television.

2012 Automotive Ad Spending by Media

Media Ad View Plus’s automotive vertical includes five subcategories: automobile dealers and automotive manufacturers, other motor vehicle dealers, automotive parts and accessories stores, tire dealers, and gasoline stations and automotive repair. Of these, automotive dealers and automotive manufacturers were the predominant advertiser category, accounting for more than $3.8 billion of the total automotive advertising $4.6 billion spent on television.

“If it’s got a screen, automakers want to advertise on it,” said Ad Age in a recent article, Automakers Like Video, But Still Pour Gas On TV For Big Product Launches. While the automakers on Ad Age’s 100 Leading National Advertisers list have been increasing their digital advertising, “they’re also showing enduring faith in the American couch potato, with spending on television increasing from 2011 to 2012. Ad Age attributes the continued popularity of television to the automotive vertical to major product launches. The top five spending automakers, according to Ad Age, are General Motors, Ford, Toyota, Fiat (Chrysler Group) and Honda.

In 2017, television’s share of automotive advertising is expected to increase to 32%, while the shares going to other traditional media such as newspaper and direct mail are expected to decline significantly. Newer media, such as online and mobile, are also expected to increase their share of the automotive pie. Part of this increase can be attributed to the significantly lower GPR revenues expected to be spent on television in 2017. Without GPR dominating television commercials in 2017, as happened in 2012, there will be more inventory available for the other verticals, such as automotive.

More information on Media Ad View Plus is available here.

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While this would be a first, should this really be a surprise? 

Broadcast’s gains have to be measured amid the fact that it has benefitted from a surprising spike in spot demand given its ongoing ratings declines. The gains in CPM are a combination of higher unit rates and the impact of continued ratings erosion as each spot delivers less audience on average than it once did. So, in theory, even rates that are flat in a program would carry a higher CPM than it did one year ago if that program has a lower audience level. As the years go by, it takes an increasing amount of commercial inventory to reach target demo delivery goals than it did a few years prior. While it might have taken 20 spots to reach 100 demo points five years ago, it now takes maybe 25 or 30 to reach that same targeted delivery. While there were impressive CPM gains ranging from roughly 9 percent to 15 percent depending on the network’s place in the hierarchy, this year’s upfront totals will not equal the broadcast industry’s highpoint in 2004 thanks, in part, to that continued decline in delivery assuming a constant in the percentage of sold inventory. 

Given the demand present and despite the constant harangue of digital sellers with dollar envy, a number of advertisers have made it clear that television remains the primary focus of the marketing budget. But if the points aren’t there in broadcast, where do you turn? 

The growing appeal of cable networks have been both a cause and beneficiary of the ratings decline of broadcasters in terms of viewers and ad dollars. Cable’s timing has been impeccable as this increased demand for its ad inventory comes when the industry is putting forth better and more highly rated content than ever, including more first run, local news and sports programming, across a wider array of its networks. Upfront reports confirm that the continued decline in broadcast audiences is translating into ad buyers buying much more deeply into the cable network universe this year in order to meet the television campaign goals of their clients. It also appears that the gap between broadcast and cable pricing continues to narrow. These are the fruits of the continued fragmentation of the television world. Buys that might have been five or six networks deep in years past are now going past 10 or 12. The gains are moving beyond the first tier networks of ESPN, TNT, USA, TBS, Discovery, etc.

What does this mean for local markets? It’s hard to imagine that what we’re seeing play out in the upfront won’t also happen there. Local advertising buyers will also likely find themselves buying more spots on broadcast stations and more local avails on a deeper selection of cable networks from the MSO’s than ever before just like their national brethren. We can all debate the impact of cord cutting or cord shaving in this Netflix-influenced era, but one thing is pretty clear-cut: It doesn’t much matter whether you’re cable or broadcast these days, just as long as the word “television” follows. 

The real trick for both broadcast and cable TV sellers is figuring out how to grow the ad pie in their local markets instead of poaching each other’s clients and prospects. The strength of their traditional assets, including their brands and television inventory, plus their growing digital offerings give them great allies in that effort. 

I guess it’s not a bad time to be selling TV advertising, is it?

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