How Covid-19 is Impacting the TV Industry
The COVID-19 pandemic initially boosted traditional TV viewership and shifted advertising spending toward categories like toys and cleaning products, but as the pandemic progressed, traditional TV viewership declined amid increased streaming, programming cuts, and billing issues, while disputes over Nielsen's ratings accuracy have led to skepticism about the true extent of these changes in the TV industry.
The number of streaming households outpaced homes paying for traditional TV for the first time last year. However, TV viewership remains relevant for advertising.
Early in the pandemic, MediaRadar tracked how lifestyle changes impacted TV advertising. There was increased spending from categories like toys, games, and household cleaning products, while sports advertising plummeted.
Nearly a year and a half since the pandemic began, the question remains: have these impacted TV categories leveled off or recovered?
Traditional TV Viewership Reportedly Decreased, but Networks Want Trust and Accuracy
With widespread stay-at-home orders, Americans initially watched more cable TV in the spring. TV ratings surged, even among younger generations who typically use streaming platforms. This seemed to counter the shift to streaming.
“Widespread ratings surges are exceedingly rare in the age of cord-cutting to begin with,” reported Adam Epstein at Quartz. “Especially now, at the time of the year when days get longer and warmer and we spend more time outdoors.”
However, the increase in viewership was temporary. Thinner programming, tighter bills, and the rise of streaming options likely led to a decrease in viewership.
By Q3 of 2020, viewership of traditional TV was decreasing across age groups, according to Nielsen. However, broadcast networks claimed that Nielsen was undercounting viewership. When TV networks called for Nielsen to lose its accreditation, the ratings firm submitted a hiatus request to the Media Rating Council (MRC).
“Nielsen has essentially announced ‘you can’t fire me, I quit’ just hours before the MRC suspension vote process is activated,” said Sean Cunningham, CEO of the VAB. With less trust in Nielsen’s tracking, it’s hard to accurately assess how much TV viewership decreased.
Nielsen will still release ratings, which will be considered by the TV industry, but perhaps with skepticism. The extent of this skepticism remains to be seen.
MediaRadar Insights
Last year, news and entertainment programming held steady compared to 2019. In 2021, it is up slightly over 2020, with $3.44 billion in 2021 versus $3.4 billion in 2020 (January – July).
As kids stayed home, parents bought more puzzles, activities, and toys. This sector grew 101% between February and March 2020. Now, it’s slowing down. Kids entertainment is down 27% year-over-year (January – July). In 2020, there was $238.2 million across 21 networks, while 2021 advertising spend is at $174.5 million across 19 networks.
Sports programming, which declined with event cancellations, is now up 67% year-over-year. This is largely due to the Summer Olympics, which accounts for $1.15 billion of advertising spend in 2021.
Without the Olympics, sports advertising would be up 38% year-over-year. In 2020, there was $3.93 billion across 30 networks, while 2021 increased that ad spend to $5.43 billion across 31 networks.
Viewership data is becoming harder to access across screens, streaming platforms, and paid TV. However, using MediaRadar, ad sales reps can see which categories and brands are spending most and across which formats.
For more updates like this, stay tuned for more updates on coronavirus and its mark on the economy.
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