TV Weathers the Storm

Broadcast, cable control half of the $144 billion media market

If you can keep your head when all about you are losing theirs, you may be a television ad sales executive.

According to a new report from Kantar Media, TV stood alone in the fourth quarter of 2011, leading the advertising market with gains of 3.1 percent versus the year-ago period. This ran counter to how the other major segments fared—digital media fell 6.2 percent in the quarter, magazine spend was off 4.9 percent, newspapers declined 3.7 percent and radio dropped 5.6 percent.

All told, Q4 expenditures dipped 1 percent, marking the first time in two years that the U.S. ad market failed to show signs of growth.

As clients reduced spend in other media, TV dollars held firm. Thanks to a robust sports market—pricing for the NFL and college football was particularly hearty, and a seven-game World Series helped add more than a quarter billion dollars to the kitty. Broadcast networks saw Q4 ad revenue grow 7.7 percent to $6.41 billion.

Network TV also got a boost from a $9.25 billion upfront and the introduction of pricey new series such as Fox’s The X Factor. In its freshman run, a 30-second spot on Simon Cowell’s competition series cost as much as $325,000 a pop.

Cable networks were up 2.4 percent in the period, raking in $6.33 billion in ad sales. Reductions in CPG spending offset higher demand from retail and fast food, thereby slowing cable’s growth.

Spot TV was the only area that showed weakness, as expenditures dropped 8.7 percent to $4.02 billion. According to Kantar, declines in November and December spend were particularly vexing, given that they should have benefited from easy comparisons against diminished, postelection spending in 2010.

Buoyed by higher sell-out levels at Univision and Telemundo, Spanish-language TV grew 19.1 percent in Q4, to $1.5 billion, while national syndication dollars were up 11 percent to $1.3 billion.

All told, Q4 TV dollars added up to cool $19.6 billion.

“The contrast of resilient TV spending and waning budget allocations to other traditional media was plainly evident at the end of 2011,” said Jon Swallen, svp of research at Kantar Media Intelligence North America. “Some mature digital media formats were also touched by the year-end tide of reduced spending. Whether this is an isolated occurrence, or an early sign of digital dollars moving more quickly toward emerging and unmeasured digital platforms, bears watching.”

Overall TV spend improved 2.4 percent in 2011, growing to $68.1 billion from the year-ago $66.5 billion. TV last year accounted for nearly half (47.3 percent) of all media spend.

According to Kantar, the top 10 TV advertisers last year reduced their network and cable spend by just 0.8 percent to $10.1 billion.

Procter & Gamble remains the top TV spender, investing $1.72 billion in airtime. Last year’s allocation marked a 6.8 percent decrease from 2010. AT&T is the second biggest TV partner, buying $1.33 billion in commercial time (-12.6 percent), while General Motors cruised to a third-place finish with a $1.11 billion spend (-7.6 percent).

No. 5 Chrysler returned to the medium with a vengeance, spending $890.4 million in TV, an increase of 38.8 percent from $641.7 million in the previous year.