Bad press for the digital duopoly isn’t driving marketers back into traditional channels.
Last year saw Alphabet's YouTube weather a stream of negative coverage after major brands’ advertising was found placed with controversial content. That torrent has ebbed somewhat as the site moved to reassure advertisers last December by hiring new content moderators.
Now, Facebook finds itself in similar crosshairs as it deals with the Cambridge Analytica data scraping controversy.
But these media maelstroms afflicting the digital advertising duopoly aren't causing a shift of marketing dollars back to traditional TV, a new report finds.
In fact, advertisers scaled back their TV ad spending to the tune of $1.07 billion last year over 2016, according to eMarketer, a media research firm. That trend carries over to 2018, when TV’s share of U.S. ad spending drop to 31.6 percent – a 2.3-percent decrease from the previous 12 months.
The firm predicted that through 2019, TV will continue to shed roughly $1 billion a year — settling at $69.17 billion next year before edging up to $69.52 billion in 2020, boosted in part by the presidential cycle. The forecasters attributed the decline to an increase in cord-cutting, which increasingly has viewers shifting to digital platforms.
As a result, digital is seeing the ad dollars pour in. This year, eMarketer expects total digital ad spending to jump nearly 20 percent up to $107.3 billion.
Still, one area of television, over-the-top (OTT) platforms like Roku and Hulu, is seeing growth.
“Over-the-top platforms are growing in number and size, and many compete directly with pay TV by offering bundles of live channels at attractive price points,” said Paul Verna, an eMarketer analyst. “[We] expect the offerings to become even more robust as more players enter the market.”
The report doesn’t predict a straightforward decline for TV. The research firm is predicting that it will regain ad dollars in 2020, as President Trump’s reelection and the Tokyo Olympics bring viewers back to TV. But that won’t be a sustained rebirth. TV’s share of the ad pie will fall to a quarter of the total spent by 2022.
“As ratings for TV programming continue to decline, advertiser spending will also continue to see declines, especially in years that do not boast major events such as presidential elections and Olympic games," said eMarketer senior forecasting director Monica Peart.