Market Analysis – 82101902 – Television placement

Executive Summary

The global Television Placement market, valued at est. $159 billion in 2023, is mature and undergoing significant transformation. While traditional linear TV ad spend is projected to decline, the overall market will see a modest CAGR of est. 1.1% over the next three years, driven entirely by the rapid growth of Connected TV (CTV) and addressable advertising. The primary challenge and opportunity is managing the strategic reallocation of spend from declining linear formats to high-growth, data-rich digital TV environments to maintain reach and improve ROI. Failure to adapt to new measurement currencies and programmatic buying methods presents the single greatest threat to procurement value.

Market Size & Growth

The total addressable market (TAM) for television ad placement is experiencing a structural shift, with growth concentrated in digital extensions of the medium. The global market is forecast to grow from est. $159.0 billion in 2023 to est. $169.5 billion by 2028, a compound annual growth rate (CAGR) of 1.3%. The three largest geographic markets are 1. North America, 2. Asia-Pacific, and 3. Europe. While North America remains the largest market by value, its growth is nearly flat, with APAC projected to see the highest regional growth.

Source: Estimates synthesized from Magna, eMarketer, and PwC Global Entertainment & Media Outlook reports.

Key Drivers & Constraints

1. Shift to Digital Viewing: The primary constraint is audience migration from linear broadcast/cable to on-demand and streaming services (cord-cutting). This fragments audiences and erodes the value of traditional, broad-reach ad buys.
2. Rise of CTV/AVOD: Connected TV (CTV) and Advertising-based Video on Demand (AVOD) platforms (e.g., Hulu, Peacock, Pluto TV) are the main demand drivers, offering data-rich targeting capabilities previously exclusive to digital media.
3. Live Events & Sports: Major live programming, particularly sports, remains a powerful driver for linear TV, commanding premium ad rates due to its large, engaged, and appointment-viewing audiences.
4. Measurement Transformation: The industry is in flux, moving away from Nielsen's panel-based monopoly toward a multi-currency system (e.g., VideoAmp, iSpot.tv) that measures viewership across linear and digital platforms, creating complexity for buyers.
5. Economic Sensitivity: Advertising budgets are highly sensitive to macroeconomic conditions. Economic downturns typically lead to immediate cuts in ad spend, particularly in the more flexible "scatter" market.
6. Political Cycles: In key markets like the U.S., election years create significant demand spikes and inventory shortages, driving up prices for all advertisers.

Competitive Landscape

Barriers to entry are High, predicated on immense capital for media buys, long-standing relationships with media owners, sophisticated data infrastructure, and the global scale required to service multinational advertisers.

⮕ Tier 1 Leaders * GroupM (WPP): Largest global media buyer, offering unmatched scale and access to proprietary data through its Choreograph platform. * Omnicom Media Group (Omnicom): Differentiates with its "Omni" marketing orchestration platform, integrating data for cross-channel planning and measurement. * Publicis Media (Publicis Groupe): Leverages its Epsilon data division to offer identity-based targeting and performance analytics, bridging TV and digital. * IPG Mediabrands (Interpublic Group): Strong position in the North American market with a focus on data-driven, audience-first buying strategies.

⮕ Emerging/Niche Players * The Trade Desk: A key technology platform enabling programmatic buying of CTV inventory, challenging traditional agency models. * MNTN: Performance-focused TV platform that combines ad creation with automated media buying on CTV, targeting direct-to-consumer brands. * VideoAmp: A measurement and currency provider that is also building out media optimization and planning tools. * Horizon Media: The largest independent media agency in the U.S., known for its agility and strong client relationships.

Pricing Mechanics

Television ad pricing is primarily based on a Cost Per Mille (CPM)—the cost to reach 1,000 viewers—or a Cost Per Point (CPP) against a specific demographic's rating point. The final price is a complex negotiation influenced by several factors. Key variables include program ratings, audience demographics, daypart (primetime is most expensive), and seasonality, with Q4 being the highest-priced quarter due to holiday demand.

There are two main buying mechanisms: the Upfront market, where advertisers commit to large budgets 6-9 months in advance for preferential rates and inventory, and the Scatter market, for buys made closer to the air date. Scatter pricing is far more volatile and typically carries a +20% to +50% premium over Upfront rates, depending on real-time supply and demand. The shift to CTV is introducing programmatic, auction-based pricing, adding another layer of complexity and opportunity for data-driven optimization.

Most Volatile Cost Elements: 1. Scatter Market Premiums: Fluctuate weekly based on inventory; can increase >50% for high-demand events. 2. Live Sports Inventory: Rights fees for major leagues (e.g., NFL) have increased by ~80-100% in recent contract cycles, directly inflating ad slot prices. 3. Audience Ratings: A surprise hit show can see its CPM increase by +30% in-season, while an underperforming show's value collapses.

Recent Trends & Innovation

• Alternative Measurement Adoption (2022-2024): Major media companies (e.g., NBCU, Warner Bros. Discovery) have officially begun transacting on new measurement "currencies" from VideoAmp and iSpot.tv, signaling a definitive move away from Nielsen's monopoly and toward a multi-provider ecosystem.
• Retail Media Networks Enter TV (2023): Retailers like Walmart and Target are leveraging their vast first-party shopper data to partner with CTV platforms, allowing CPG brands to link TV ad exposure directly to in-store or online sales.
• Growth of Programmatic Guaranteed (2023-2024): A blend of programmatic efficiency and traditional direct deals, Programmatic Guaranteed (PG) is gaining traction in CTV. It allows buyers to automate the purchase of reserved, premium inventory, streamlining workflow without sacrificing quality.
• Interactive & Shoppable Ad Formats (2022-2023): Networks and platforms are increasingly rolling out ad formats with QR codes or other interactive elements, aiming to shorten the path to purchase and provide more direct attribution for TV campaigns.

Supplier Landscape

Note: Market share is estimated based on reported global media billings.

Regional Focus: North Carolina (USA)

Demand for TV placement in North Carolina is robust and cyclical. The state's diverse economy, with major hubs for finance (Charlotte), technology/research (Raleigh-Durham), and manufacturing, provides a stable base of regional and local advertisers. However, demand and pricing see extreme volatility during election cycles, as North Carolina's status as a key political "swing state" attracts massive ad spending, creating inventory scarcity. Local capacity is strong, with multiple network affiliates and cable systems covering all major DMAs. There are no unique labor or tax regulations that materially impact the procurement of this service within the state.

Risk Outlook

Actionable Sourcing Recommendations

1. Mandate a 15% budget shift from linear TV to programmatic Connected TV (CTV) buys over the next 12 months. This strategy will leverage superior audience targeting to reduce media waste and improve return on ad spend (ROAS). Partner with our media agency to establish new performance KPIs beyond traditional gross rating points (GRPs) that measure business outcomes.

2. Mitigate measurement risk by launching a multi-currency trial for 25% of the TV budget, using a certified Nielsen alternative (e.g., VideoAmp, iSpot.tv). This provides richer cross-platform data and reduces dependency on a single provider. Simultaneously, negotiate greater flexibility in upfront contracts to allow in-flight budget reallocation between linear and digital video based on performance data.