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A Challenging time for TV Broadcasters – and for the UK!

Over the years the TV advertising market has often reflected the economic climate for the UK. Since the Brexit vote there are clear signs from this market that the UK economy is facing a challenging time.

Prior to the Brexit vote in the first six months of 2016 we saw YoY increases in TV advertising revenues of 2%. Since the vote there has been a decline in TV Ad revenues, and this has carried through Q1 2017, where estimates suggest revenues could drop by as much as 9%.

Some of this decline can be attributed to an early Easter (historically a period of high advertising demand!) in March 2016, this year it is predicted that TV revenues for March 2017 will be down 14%. Despite Easter moving back to April, it is estimated that TV revenue growth for the month will be minimal.

Current economic signals – particularly increasing inflation and stagnation of wages – point to a squeeze. This is likely to affect consumer spending, knocking business confidence, and leading to instability as profits fall; all of which threatens a significant effect on future UK TV revenues, as advertisers find it increasingly difficult to fund future TV campaigns.

There is no doubt that the TV broadcasters are facing their biggest challenge since the recession of 2007/8. However, for committed advertisers, these conditions could provide a great window to exploit the opportunity these variable factors are producing! If audiences remain stable and revenues decline this will provide a deflationary scenario for TV advertising, making it even cheaper to advertise – allowing shrewd advertisers to take greater advantage of what is still the most impactful and powerful medium in the UK.

If you would like to know how to take advantage of these more opportune advertising conditions and turn the gloomy economic outlook to your benefit, why not contact us to see how we can help you to increase the momentum in achieving your objectives?

 

– written by John Alligan

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