TV Ad Influence Continues to Drive Spending

For years, we’ve heard how online and social network venues are going to capture the attention of consumers and convince them to buy products and services they’ve seen advertised on these channels. But, the actual numbers tell a different a story.  TV remains a top influencer on consumer purchases.

New Kantar Media data indicates that while overall ad spending is growing at the rate of about 2.6%, TV is experiencing a rise of something more like 7.6%. The numbers are even more impressive for the Spanish-​language TV format. Here’s how spending increases are breaking out by TV segment:

  • Spot TV 2.5%
  • Network TV 7.0%
  • Cable TV 7.4%
  • Spanish language TV 20.7%
  • Syndicated TV 15.7%

This kind of growth is surprising considering the change in audience. Nielsen data indicates that the TV audience is actually shrinking. In the 4th quarter of last year, 1.7% fewer people were watching TV. In addition, time spent watching TV is fairly stable at about 153 hours and 19 minutes per month.

So why are advertisers spending more money on a saturated format? It’s all about influence. For the Hispanic population, studies show that these consumers appreciate TV ads that target them and their recall increases by 30% when ads are played in Spanish.

In the general population, consumers give TV the highest grades regarding influence by media type. However, there is some degradation of influence when correlated to age:

  • Ages 18–34: 40.8%
  • Ages 35–64: 36.5%
  • Ages 65+: 32.7%

The high rates of influence from TV ads have been reported from several major research shops including ExactTarget, Nielsen and Kantar Media. The biggest reason for the influence is trust. Here’s what consumers trust completely or somewhat with respect to marketing:

  •  Recommendations from people I know 92%
  • Consumer opinions online 70%
  • Editorial content in newspaper 58%
  • Branded websites 58%
  • Emails I signed up for 50%
  • TV ads 47%

For ads on search engine results pages and social networks, the numbers hover at 40% or lower. Analysts notes that even online consumers are more likely to trust TV ads.

The dominance of TV is unlikely to change at least through 2016. Seasonality will impact TV media buys, especially in years with heavy Olympics and political spending, but the format's overall growth will exceed the average media spending increases. TV should experience 6.7% compound annual growth rate between now and 2016 while the total ad market will have an increase of about 5.9%.

[Source: Data Dive: US TV Ad Spend and Influence. Marketingcharts. August 2012. Web. 13 Aug. 2012] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.