Report: Ad-spend flat in 2017

Matrix Solutions, the global ad sales platform built for media, has released its first annual Advertising Spend Report – providing insights derived from the activity of more than 10,000 active users within media ad sales teams from 2016 to 2017.

“According to our data, overall ad spend remained relatively flat from 2016 to 2017, which means the stakes are higher than ever for media organisations looking to improve their bottom line,” said Mark Gorman, CEO at Matrix Solutions. “Understanding where brands are investing provides media ad sales teams with a leg up in bringing in revenue more efficiently.”

According to the report, political ads made up more than 12 per cent of the media industry’s advertising spend in 2016, totaling more than $1.5 billion. This number decreased after the election to $220 million in 2017. For a more holistic view of the media ad sales industry year-over-year, Matrix Solutions removed political advertising from its metrics and came up with the following trends:

  • Broadcast: Key areas of ad sales growth in broadcast included media/communications (6.56 per cent growth), general services (2.24 per cent growth), and health and beauty (0.70 per cent growth).
  • Digital Broadcast: Ad sales grew across nearly every category in digital broadcast (at an average rate of 13 per cent), with financial services being the only category that saw a decline (-2.09 per cent contraction).
  • Radio: Health and beauty (26.15 per cent growth), travel and leisure (24.28 per cent growth), general services (15.15 per cent growth), and home improvement (3.87 per cent growth) showed significant growth in radio in 2017.

Local advertising is becoming more important than ever, with local spending remaining flat/slightly down (-1.02 per cent contraction) and national spending down by more than $155 million (-4.15 per cent contraction) – excluding political advertising, which made up a significant portion of national budgets in 2016.

In 2016, companies in the Northeast spent the least amount of money on political advertising (more than $273 million), while companies in the Midwest spent the most (more than $440 million). Regionally, the South has been the least affected by the falloff of political advertising. But, if we exclude political ads from our analysis, the South and Midwest have seen the largest decrease in spending from 2016 to 2017, at -2.53 per cent and -3.71 per cent respectively.

Methodology

Matrix Solutions looked at $11 billion worth of media ad sales deals to see which categories and platforms were most popular across the media ad sales industry in the US – normalising each category across more than 10,000 unique active users.

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