Maybe the monthly SMI numbers point to a TV problem, rather than a market problem
Welcome to a midweek update from Unmade. Today: The advertising market may be (sort of) holding up, but television is not; and The Market Herald leads a downwards dip on The Unmade Index.
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Even The Matildas couldn’t dig TV out of its hole, but live content is still the only answer
Tim Burrowes writes:
August seems like such a long time ago.
That amazing night with the shouting and the penalties and whole Courtnee-Vine-writing-herself-into-sporting-legend thing was seven weeks ago now.
It may have been Seven’s biggest ratings night of the decade, but it didn’t translate into advertising revenue.
How Unmade covered the ratings:
That payday came four days ago with the AFL grand final. Just under 2.5m metro TV viewers watched Collingwood’s victory. Combined with regional viewing of 949,000 and 443,000 streaming on BVOD, it gave Seven a Total TV number of 3.855m.
The next day, the NRL Grand Final delivered Nine a Total TV number of 3.404m.
The Standard Media Index numbers for August – which were released yesterday afternoon – demonstrate how little commercial impact the Women’s World Cup had for Seven. Media agency revenues for broadcast TV for August were down by 15.4% compared to a year before.
The World Cup dollars went to the primary rights holder Optus Sport. Seven got the ratings but Optus got most of the spoils.
That’s no surprise. The relative lack of commercial upside for Seven West Media was telegraphed when the company did its end of year results announcement four days after the France game. When CEO James Warburton was asked about it in the investor call, he was quick to point out that AFL is much easier to monetise than football, where ads can’t be shown during the game.
How we reported Seven’s results in August:
The deal was for Seven to simulcast the Matildas games with Optus, and for sponsorship deals for the tournament to be a joint sell by both companies.
By the looks of the SMI data, that revenue mostly went to Optus. As a result, the digital video advertising category was up by 42% for the month in the SMI numbers. And ad revenue for Optus quadrupled, SMI said. Quadrupled. Admittedly off a low base, but even so.
Incidentally, we’ll have to get used to no longer calling the company SMI. Since selling to private equity it’s been steadily rebranding. Now it’s Guideline SMI.
Perhaps the most notable thing about the Guideline SMI data, which covers advertising spend via the media agencies, is that while the overall market is down by 5.5% compared to the previous August, the hit on the TV networks is much worse.
Money is shifting away from television. Outdoor advertising had a great month – up by 4.8%.
That creates a more worrying moment for the TV networks. It’s one thing to suffer in a cyclical dip, but what if the money doesn’t come back in the next cycle?
A long predicted trend is coming true. Only live content – news and sport – does well in the schedules.
Take Monday night of this week. The most watched program was Seven News with a 1.4m Total TV number across metro regional and BVOD. The only recorded show to score a Total TV number of more than 1m was Nine’s The Block on 1.2m. My Kitchen Rules on Seven did 900,000. Ten’s best performer was Have You Been Paying Attention on 700,000.
The television industry is going to need to find itself a new level. It’s possible for a medium to both be in decline and still be significant. The process is one that other media have been through. One question is whether TV follows the trajectory of newspapers, or of magazines.
Newspapers were in a decade-long downward spiral. In August, newspaper advertising revenue was only down 1.5%, which outperformed the market.
But magazines, which broadly means Are Media these days, are yet to find a bottom. Ad revenue into printed magazines was down another 12.3% for the month.
With two months of data available for this financial year, it’s too early to know how the market will pan out. SMI’s overall July number was down 1.3%.
If you want to make a case for optimism, it’s the fact that August’s decline of 5.5% for the overall market was in comparison to a record market that was up 2.4% last year.
Yes, marketers are cautious in a questionable economy. And they’re looking for alternative ways to reach audiences as TV becomes less reliable. But at least they’re mostly still spending.
Maybe it’s not a market problem but a TV problem.
Unmade Index sinks a little lower
Seja Al Zaidi writes
The Unmade Index dropped 0.98% as the ASX resumed regular trading yesterday. The Index, which measures how ASX-listed media and marketing stocks perform on a daily basis, fell to 622 points.
Most of the larger stocks performed poorly. IVE Group had the largest fall of 4.64%, and Southern Cross Austereo dropped 2.60%. Ooh Media’s share price declined 1.77%, and Nine’s 1.46%.
The Market Herald hit another new low, falling 3.85% to a market cap of $80m.
ARN Media had a strong day, rising 5.42%. Sports Entertainment Group, which owns SEN, rose 6.52%. Enero Group enjoyed a rise of 1.57% in its share price.
Time to leave you to your Wednesday.
We’ll be back with an audio-led edition tomorrow in which we talk to journalist Peter Greste, who became a global figure of attention when he was held captive by Egyptian authorities for more than a year. We discuss why the Alliance for Journalists Freedom wants a new organisation to oversee journalism.
Have a great day.
Toodlepip
Tim Burrowes
Publisher – Unmade
