February 18, 2019

TV Ad Spend is Increasing

Companies like American Express, Proctor & Gamble, and Amazon directly correlate TV ad spend to increased sales.

In the past several years, we’ve been hearing that TV is dead, irrelevant, and even outdated. We’ve seen a rise of digital marketing and significant shifts in media budgets. Trends have favored the uptick of bigger portions of budgets being allocated to digital for mobile, social, search, and more. However, TV is not dead. TV ad spend is actually on the rise.

In mainstream media, TV seems to be getting pushed aside in favor of digital media trends; however, that’s not necessarily true. Ad spending on TV is continuing to grow and is projected to continue upward. This growth is driven by the expansive reach TV offers. According to Nielsen, the average American watches nearly four and half hours of live TV per day.

With an increase in audiences known as “cord-cutters,” and now “cord-nevers,” also comes the “over-the-air homes (OTA).” These are homes that receive broadcast TV free, without a subscription, with antennas or antenna capable TVs. This type of viewing gives consumers access to live TV such as news, sports, and other premium programming. OTA homes have increased nearly 50% since 2010 and that number is only growing.

Growth in Over the Air TV Homes

How audiences consume other forms of media is also a factor in TV ad growth. For example, second and third screens are extremely common while someone is watching TV. Instead of hindering TV viewing, this actually is a good thing. 68% of adults report utilizing another screen to look up information about what they are watching on TV.

Multiple large-scale companies such as American Express, Proctor & Gamble, and Amazon directly correlate TV ad spend to increased sales.

At the beginning of 2019, we’ve seen the biggest digital players, who pushed other brands to go digital, continue to increase their own TV ad spend, notes Bailey Lauerman’s Associate Media Director, Megan Storm. There will always be a place for traditional TV in media budgets to drive brand growth and sales. Traditional TV will continue to provide strong reach and, combined with the right media mix based on the industry, will bring results to brands who want to grow.

Amazon now spends more on TV advertising than McDonald’s. Read more in the Wall Street Journal article here.

To get in touch with our Associate Media Director, Megan Storm, email [email protected].


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