2020 vs. 2019: A Look at Changes in National TV Ad Spending by Industry
2020 was a turbulent year for TV advertising with larger than usual swings in both viewership and category spends. We have covered some of those larger TV viewership trends in previous articles but wanted to dive into Nielsen’s AdIntel to provide a view on TV Ad spending by category and show the massive shifts from 2019 to 2020. We are using Jan-Nov 2020 vs. 2019 data based on availability at the time of the report.
Overall national TV spends were down 8% in 2020 when compared to 2019. This represents about $4B less in linear TV spend than the previous year, with about three quarters of that loss coming from just two categories! More on that in a minute. The first half of the year had the larger drop of 13% vs. 2019, while the second half of the year only reported a 2% drop year on year. The composition of industries that were spending more is a very interesting component. Below is a chart showing a handful of key category fluctuations for the overall year as well as how the first half of the year was impacted vs. the second half of the year:
Probably not too surprising that entertainment, which is primarily driven by motion pictures and amusement parks/sporting events had the largest decline from a total dollars perspective. Entertainment as well Auto are two of the largest categories for National TV advertising and in 2019 they reported over $10B in spend. The declines in spend from those two categories re-shaped the TV ad landscape in 2020 due to their significant share of total ad dollars spent. Travel, and alcohol also all had sizeable drops year on year. What is interesting is that both auto and alcohol regained momentum in the back half of the year which contributed to the overall TV ad market rebound.
The two areas that saw sizeable increases in ad spend last year were direct response products and media companies. These two categories contributed to nearly $1B in incremental national TV spending in 2020 combined! Perhaps it is not too surprising given that COVID has driven people indoors more than usual which has increased overall media usage (TV and Streaming included) as well as increased e-commerce usage which makes up a sizeable portion of the Direct Response industry.
Early views of 2021 point to a continued rebound of overall TV ad spending, but it is likely that some of these trends will continue for the foreseeable future as the changes in how people consume media content continues to drive changes in television spends by industry.