TV ad continues to decline as digital ad spend grows

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TW ads are expected to generate just $70 billion in ad revenue in 2019. 

The traditional TV ad spend in the U.S. has declined to 3% this year. eMarketer said that this trend will that TV ad spend peaked at $72.40 billion last year whereas digital spend in all formats now takes more than half of the overall ad revenue. 

Included in the report is the forecasted growth of TV ad spend in 2020 by 1.0% due to the presidential campaign and the Summer Olympic Games but after that, it will keep a ‘long-term decline’. By 2022, TV ad spends will from below one-quarter from the total US ad spend. With the continuous decline, TV ad spend is expected to have less than 30% of all TV ad spend revenue this year, an all-time low for the ad industry. 

People are watching less

U.S. viewers have been spending less time watching traditional TV. On average, viewers only watch 3 hours and 40 minutes/day. Additionally, the report stated that all the age brackets have shown a decline of time spent watching TV but it’s most apparent to the viewers aged 17 years and below. 

Monica Peart, forecasting director at eMarketer noted that there’s a shift from traditional to digital viewing thus causing the subscription decline in pay-TV. Major networks have suffered from lower ratings and lower viewership over the year. Despite the gloomy future of traditional TV, it still has the widest audience reach today that’s why advertisers still invest in it.

Peart further added that the doors aren’t closing for traditional just yet as this industry is highly affected by world events. Every now and then, it’s ad spend will increase by a little but will come down again. It may reach its peak of $72 billion again but it’s next to impossible for the TV ad spend to increase due to the decline in bot viewerships and ratings. 

What does this mean? 

TV has been a long-standing channel to reach a wider audience and improve brand presence. Compared to other traditional mediums, TV has survived the test of time. However,  the changing attitudes of viewers are changing the game for traditional TV. With this decline in rates, the ad space and slots for marketers will become cheaper. Digital ad spend costs more and advertisers may revert to TV ads until it’s still effective in promoting brand awareness. 

Advertisers go where the audiences are. TV still has the widest reach today but digital platforms are fast catching up. 

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