What is the future of the ad industry?
What is it that makes ad companies tick?
A new report from the National Association of Broadcasters suggests that ad companies are on the verge of a massive transition to a new model of revenue-generating.
According to the report, ad sales in 2019 will account for about 20 percent of total revenues.
This is a huge shift from years past when ad sales accounted for about 15 percent of the industry’s revenue.
But that shift is still just a phase.
“In 2019, the ad revenue mix will change drastically,” said NAB President and CEO John Martin in a press release.
“It will be in the mid-to-high 20s percent of ad revenue, with a very modest share going to TV networks and broadcast affiliates, while TV networks will make up the remaining 10 percent of revenue.”
“In many ways, the industry is on a collision course with the next phase of the transition, the new model that will allow TV networks to compete with traditional ad networks,” he continued.
“But the new revenue model will still depend on television networks competing with traditional advertisers, which means that some of the most valuable TV ad inventory is still sitting in the hands of traditional advertisers.”
In other words, advertisers will still be paying TV networks for TV ads, but they will no longer be able to do so for every ad.
For example, if you have a spot that is about a person’s favorite sport and it features an image of a soccer player, you may be able get an ad on the site that will be more likely to draw the viewer’s attention to the soccer player.
The new model also will mean that ad buyers will need to be willing to pay more for ad inventory that is more targeted.
Advertisers will also have to compete more effectively against social media platforms, which are likely to be in a stronger position than TV networks.
In addition to the shift to a higher percentage of ad revenues from TV ad sales, NAB expects advertisers to need to spend more time on digital channels to keep pace with new digital advertising strategies.
As a result, the NAB’s Martin said, “the ad industry will need the most of the next decade to maintain its competitiveness.”
“The future is still uncertain, but the shift is here and advertisers are already seeing it.
It’s a big shift for the industry and we expect it will be a major challenge for the entire industry,” Martin said.
How big is the shift?
Nab’s report says that in 2019, TV ad revenue will account “for around 20 percent” of total revenue.
That’s not a huge change, but it’s certainly a substantial shift.
It’s also not a major change for the traditional TV ad market.
Last year, ad revenue accounted for more than half of all TV ad spending in the United States, according to Kantar Media’s Ad Spend Tracking.
To put that in perspective, television ad spending is still around 23 percent of all ad spending across the country, according the NPD Group’s ad spend tracker.
If TV ad revenues were to grow to 20 percent, it would mark a new low for the TV ad industry.
That means that traditional TV advertisers will be paying far less to advertise on TV than they were in the past.
While the transition to the new ad revenue model is still a long way off, it’s not entirely out of the realm of possibility.
NAB predicts that traditional ad revenue growth will be around 5 percent over the next few years, meaning that traditional television ad revenue is expected to grow by about 1.5 percent a year from 2019 to 2020.
And that’s assuming TV ad companies continue to make their ad inventory available to advertisers at a competitive price.
However, the transition is likely to take longer than that.
A lot of the growth in TV ad advertising will be coming from social media.
Since social media has exploded in the last few years and advertisers have been able to use ad platforms such as Facebook and Instagram to target audiences with their ads, it is possible that the ad business will start to experience a growth spurt in social ad revenue.
What will it take for TV ad to take off?
The NAB report also notes that in the years to come, the amount of time that traditional advertising is available to TV ad buyers is likely going to be very limited.
At the moment, TV ads are being purchased in a relatively short window of time and are being placed on a small amount of ad inventory.
Even though television ad sales are growing quickly, it will take years for the growth to take hold.
By 2023, the average ad spend per viewer on TV was $8 per hour, according Ad Age.
Meanwhile, in 2019 alone, advertisers spent $3.6 billion on TV ads in the U.S. When you factor in the $5 billion that TV ad spend will grow to over the course