Analyst: Digital Ad Woes Could Help TV Marginally

Ratings among the key issues, Nathanson says

With some advertisers stopping their spending on Google, YouTube and Facebook, some of those ad dollars could return to TV, though likely not many, according to a new report.

Michael Nathanson of MoffettNathanson Research said that as a result of the headlines about measurement issues on thse platforms, he is often asked by investors if TV can win back money from digital competition.

“While we think, on the margin, that is indeed possible, digital’s over-reliance on both the long-tail of small to medium-sized enterprises and non-brand direct marketing dollars provides resiliency in the marketplace,” Nathanson said.

That means only a small portion of digital spending comes from the kinds of major marketers that tend to buy advertising on national TV -- one reason why both digital and TV advertising were able to grow in 2016.

Nathanson said other factors may be more important in determining the growth of TV advertising.

The first is ratings, which have been falling in the year following a change in Nielsen’s methodology that gave cable networks a boost at the beginning of 2016.