SMI: Radio Off 16 Percent In January

U.S. advertising demand delivered a healthy year-on-year gain in the first month of 2016 despite uncertain economic conditions, pushing total ad market revenues up by 4% in comparison to the same time in 2015, according to Standard Media Index’s (SMI) latest data.

The total market stayed in positive territory in January, driven by dollars flowing into the television sector (up 1%) and digital media, which surged by 16% YOY. Broadcast jumped by 9% YOY, however cable TV advertising was down -3% for the month.

Broadcast ad revenues were driven by healthy network ratings in January which included the rebooted classic of “The X files” and bumper audiences for football. CBS’s AFC Championship match between the New England Patriots and Denver Broncos was watched by 53.3 million viewers – the second largest for the event in 39 years.

The magnetic pull of digital media continues into 2016, with marketers drawn towards the sector as many cable networks continue to face ratings challenges and advertisers scout new ways to reach hard to target audiences. Digital's share of total ad spend in January 2016 has increased to 27%, rising by 3 points compared to 2015.

James Fennessy

“January’s results are encouraging given current market uncertainty. Improved ratings, driven by the outstanding performance of the NFL, have delivered healthy growth for major broadcasters, even with a slight dip in ratings for the month. Cable hasn’t been as fortunate as revenue declines are tracking closely with softer ratings,” said James Fennessy, SMI’s chief executive officer.

“Digital continues to deliver healthy double-digit gains and, while this growth looks to be mostly organic, there is little doubt that the print and radio sectors are being negatively impacted. The one other bright spot is out of home advertising which continues to build on the great momentum generated in late 2015.”

In traditional media, SMI’s data showed that out of home advertising saw a spike in advertising, but the magazine, newspaper and radio sectors slid during the month into negative year-on-year comparisons.

SMI January Ad Market Highlights

• In January, broadcast TV grew by 9% and cable TV ad spend slipped by -3% year-on-year.
• Reporting on 80% of national advertising from global agencies, SMI’s data shows that Syndication, Local/MSO cable and Spot TV all fell by single digits in the month.
• Television's total market share is currently 59%, having dropped by 2 percentage points from 61% in January 2015.
• The top six broadcast networks saw ad sales growth of 10% YoY in January 2016. CBS and NBC saw double-digit increases thanks to strong ratings.
• Cable networks TBS, HGTV and Freeform continued their strong performance again in January with healthy double-digit percentage rises.
• In the print market, newspaper spending dropped -17% YoY while the magazine sector fell by -2% in the past month.
• Radio ad volumes were lower in January and declined by -16% YoY.

The top growth categories in a year-on-year performance for January were prescription pharmaceuticals (35%), consumer electronics (30%), beauty and grooming (15%).

SMI captures 80% of total national U.S. agency spend exclusively from the booking systems of five of the six global media holding groups, as well as leading independents.