Ad Market Increase Likely to be 4.1% for 2017

BY Kathy Crosett
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Brian Wieser, media analyst at Pivotal, is out with another revised forecast for 2017 ad sales. Earlier this fall, Wieser estimated a total increase of 4.4% for the ad market. He’s backed off a bit and now expects the year to end with a 4.1% increase. Here are the details.

TV and digital advertising make up the bulk of the ad market, TV, in particular, is a format under pressure. According to Wieser, national TV is down 2%. When the 6% drop in cable and broadcast TV is factored in, the entire TV market is looking at a 4% dip in 2017. In fact, the national media companies Wieser tracks only count 57% of their revenue from TV, versus 59% at the same time last year.

It’s not enough to expect marketers to substitute a dollar for dollar switch from TV to digital formats, says Wieser. The large national marketers which have been stalwarts of TV advertising are, in some cases, pulling back on advertising altogether.

Nonetheless, the digital estimated expansion of 21% during Q3 of 2017 will boost the ad market. Wieser points to large e‑commerce brands as one source of continued growth in the digital ad market. Digital advertising is also being buoyed by small local businesses that don’t have sufficient financial resources to commit to large TV buys or are “too small to efficiently use television.” This line of reasoning is supported by growth recently reported in the OOH market and analysts emphasizing the importance of large tech company ad buys.

Major year-​end forecasts are due out from Madison Avenue shops next week. It will be interesting to compare their numbers to Wieser’s. In the meantime, sales reps can stay busy by selling inventory of both digital and traditional ad space to small local businesses.