ITV ad revenue rocked by Olympics
ITV’s advertising revenue dropped 6 per cent in its third quarter as advertisers reined in spend during the Olympics and Paralympics, but the broadcaster is still expecting to outperform the TV market across its full year.
The news comes ahead of ITV’s expected announcement that it will be rebadging its channel brands and their idents as it looks to better reflect the differences between the channels in its portfolio and grow its share of viewing.
Ad revenues slumped 10 per cent in July and 9 per cent in August but this was partially offset by just a 1 per cent drop in September, which ITV says still leaves its first nine months in “positive territory”. Ad revenue for the nine months September was £1.077bn, up slightly from £1.074bn in the same period the previous year.
The broadcaster set out a five-year transformation plan in 2010 to garner half of its revenue away from traditional ad break slots, through sponsorships, digital deals and its ITV Studios production and distribution business. “Non-NAR” revenue rose 15 per cent year on year to £730m in the nine month period, meaning about 46 per cent of its total revenues came from non-traditional advertising.
Of this figure, ITV Studios grew revenues 20 per cent to £498m. Online, pay and interactive revenues grew at “about 20 per cent”, although ITV did not draw out an exact figure in its results.
Adam Crozier, ITV’s chief executive, says it has made further progress in “reshaping and rebalancing” the company to ensure it is more robust both commercially and creatively.
He adds: “This has been an extraordinary year for UK television with many unique events including the Queen’s Jubilee, The London Olympics and the Paralympics. In fact nine out of the top 10 programmes aired will not return next year and as we expected this has affected our viewing performance. However, we do not expect our viewing performance in 2012 to impact our advertising share in 2013 and we are focussed on growing our share of viewing next year.”
For the fourth quarter, ITV predicts its TV ad revenue will be down 2 per cent – with a drop of 2 per cent in both October and November, while December ad revenue is expected to be “broadly flat”.
Crozier says: “The economic outlook remains uncertain and we continue to see monthly volatility in the UK television advertising market, but the underlying trends have not changed. Over the full year we expect ITV Family NAR to be broadly flat and that we will again outperform the television advertising market.”
The TV advertising market is expected to decline 0.7 per cent, according to The Advertising Association and Warc’s latest forecast.
