Can Political Buffer Local TV Advertising from Significant Declines in Other Vertical Categories?

BIA TVForecast May2020

BIA has lowered its 2Q 2020 forecast for local media advertising. BIA is now forecasting that local TV ad spend in 2020 will be $18.5 billion, with $17 billion attributable to over-the-air revenue and $1.5 billion for digital revenue. BIA is also predicting local TV will generate an additional $10.44 billion from retransmission consent agreements between local TV stations and cable/satellite companies/virtual MVPDs.

Local television stations, like all media, will see significant decreases in advertising from many verticals. Political advertising will buffer those decreases in many markets with competitive Senatorial and Gubernatorial races and in Presidential battleground states. The $17 billion that BIA is forecasting for local OTA TV in 2020 is actually up very slightly (less than 1%) from 2019 spend of $16.8 billion. OTA TV is the only traditional media channel that BIA is forecasting will show any increase in ad spend in 2020, and that is because of Political.

Where are the biggest declines? Two of the hardest-hit business verticals in BIA’s updated 2020 local advertising forecast are Leisure/Travel/Recreation and Retail. This is not surprising since many of the businesses in those vertical categories have been either shut down since mid-March or operating at reduced capacity.

“Local television stations, like all media, will see significant decreases in advertising from many business verticals like travel, leisure and retail,” said Mark Fratrik, SVP and chief economist at BIA Advisory Services. “Political advertising will buffer those decreases in many markets that have competitive Senatorial and Gubernatorial races and in Presidential battleground states. Plus, continued growth in OTT and digital will help to soften the impact of the pandemic on advertising revenue.”

Speaking to the forecast, Fratrik offers, “Since we completed this forecast in early April, over 25 million Americans have filed for unemployment insurance and there are continuing economic concerns as the country moves to open back up. We expect political advertising will increase very quickly, and we anticipate certain verticals will rebound more quickly than others. It is going to be a dynamic marketplace this year, and we will continually monitor the nationwide and local economies to update our forecast based on new information.”

Accessing BIA’s Television Forecasts

To get more details on BIA’s TV forecast, new Local TV Market Profiles and Station Overviews are now available in the BIA ADVantage platform.  The following estimates and data is available for every television market:

  • Local TV Market competition and revenue
  • TV market revenue (Over-the-air, Online and Retransmission)
  • National/Regional vs Local Breakout
  • OTA Advertising Revenue Metrics
  • Station directory and multi-cast stations
  • Local data such as ethnic populations, household incomes, per capita income, retail sales, average, population and more

A comprehensive profile of all 210 television markets (plus Puerto Rico) is also available in the first-quarter edition of Investing In Television® Market Report and in BIA’s software database, MEDIA Access Pro™.  

BIA Vertical Opportunity Reports

Vertical Opportunity reports are available for purchase for several verticals, including Political, Healthcare, Home Improvement, Automotive and more.

BIA ADVantage Subscribers

BIA ADVantage subscribers can login to access these vertical reports and the new Local TV Market Profiles and Station Overviews for their local markets.

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