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Agency spending last year held true to some familiar patterns, but diverged from 2016 in others, according to recent data released by Standard Media Index (SMI). The report indicates that digital again led growth rates, but that its growth is slowing.

A quick word on methodology before moving forward: SMI’s figures are sourced from advertising agencies’ billing systems and aggregated to show a combined picture of direct agency spend across media types. They do not capture advertising dollars spent directly with media groups.

Overall spending was up by 3.8%, compared to a 6.8% increase in 2016. Much of that decline owes to 2016 having been an Olympic year: Sports spending was down by 12% in 2017, but by only 1.3% excluding the Olympics.

While Entertainment programs saw relatively flat ad spend (-0.8%), News media posted a 4.1% increase, driven by double-digit growth for the 3 main cable news networks.

The following are some brief highlights, by medium, from the SMI report.

TV

Direct agency spending on TV advertising declined by 3% in 2017 after a 4.4% increase in 2016. But that 2017 decline was almost entirely the result of comparison to the Olympics in 2016; without that impact, national TV would have declined by just 1%.

In fact, SMI notes that “heading into 2018, ad spend in National Television is trending positively.” Indeed, national TV ad spend grew by 1.1% year-over-year in December, while remaining largely flat (-0.1%) for the fourth quarter.

(Kantar Media, which obtains its data via a different methodology, counted a 1% decline in total TV ad spend in Q1 2017, followed by a 4.2% decrease in Q2 2017, but flat thereafter.)

Broadcast TV (-3.9%) felt the sting of the Olympics the most, per SMI, as evidenced by NBC’s decline of 15.5%. Without counting the effect of the Olympics, NBC would have gained 4% in ad spend during 2017. (As Adweek reports, it’s in the midst of an upswing in ad spend in early 2018: over a span of about 3 weeks, it stands to make $1.4 billion from the Super Bowl and Winter Olympics.)

The Super Bowl – giant advertising event that it is with an estimated $534 million in ad revenues last year – swung the fortunes of 2 networks last year. CBS ad revenues dropped 4.2% year-over-year mostly as a result of losing the Super Bowl to FOX, which registered a 14.2% increase.

Overall, the top 5 networks in terms of ad revenues were CBS, NBC, ABC, FOX, and ESPN, which combined for 42.4% of all national TV advertising spending by agencies.

In terms of advertiser categories, SMI reveals that the Auto industry spent the most on national TV, despite a 13% decline in spending. Prescription Pharmaceuticals (+8%) and Food, Produce & Dairy (-4%) were the other top-spending categories, while Travel (+16%) and Non-Alcoholic Beverages (+10%) were the fastest-growing.

The biggest decline in ad spending on national TV came from the Entertainment industry, down 16%.

Digital

In 2016’s ad spending recap, SMI noted that there were some indications of a shift away from digital and towards TV. And while the TV ad market was down in 2017, growth also slowed for digital ad spend.

For the year, SMI registered an 11.6% increase in direct agency billings for digital advertising, down from 13.3% growth in 2016 and a 26.2% increase in 2015.

The IAB and PwC have been reporting strong growth in social media ad spend, which is now estimated to account for almost one-quarter of digital ad spend in the US. SMI’s report confirms that 2017 was a strong year for some social platforms: spending on Facebook and Instagram combined jumped by 40.5%, while Snapchat posted 51% growth.

However, SMI notes that there was a “marked deceleration” in Snapchat ad spend in the second half of the year after “tremendous” growth in the first half.

As for Twitter? It was the only major social platform to register a decline in agency ad spend, of 11.8%.

Print, Radio, and OOH

In contrast to national TV and digital, the markets for print and radio improved in 2017 relative to the year prior.

Overall print spending did decline, but by a fairly muted 3.5%. That compares favorably with 2016, when agencies spent 9.1% less on magazines and 13.1% less on newspapers.

Meanwhile, overall spending on radio advertising for the year increased by 5.9%, a nice bounce-back after a stagnant (-0.5%) year in 2016. Radio’s overall performance was strong considering that radio ad spend declined by 9% in December.

As for out-of-home (OOH), it continued to register healthy growth rates (up 4.6%), although not quite at the same level as in 2016 (up 6.9%). Unlike radio, OOH finished the year on a high note, with ad spending growing by 16% in December.

More data from SMI’s report is available here.

About the Data: Standard Media Index data is sourced directly from advertising agencies’ billing systems and then aggregated to show the combined picture of direct agency ad spend across all media types. It includes all media bookings from the participating agency groups and covers up to 80% of total agency spend across 15 global markets.

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