Annual TV Market Round-Up – 1999

Revenue

ITV’s annual revenue growth showed an improvement on last year as total revenue came in at £1.9 billion, ahead of the Network’s £1.8 billion target. This represents an annual growth of 6.3% and compares to last year’s 4.8%.

Estimates from NTC’s Advertising Forecast put 1999 TV advertising expenditure growth at 8.2% and total UK display growth at 6.0% (final figures will not be available until later in the year). Both ITV’s and Channel 4’s revenue growth fall below the TV average, whilst Channel 5 and the satellite stations are performing above the average in terms of their own growth.

ITV’s strongest growth months were February and March, up by 16.7% and 14.8% respectively, whilst May saw revenue drop back 15.1% compared to 1998. This is largely due to the World Cup in the summer of 1998 when fmcg advertisers moved substantial amounts of adspend to either side of the World Cup, particularly to April and May. This accounts for the year on year decline in revenue for each of those months.

Amongst the ITV franchise companies, Carlton saw its share of the revenue drop by 0.6% points year on year to 15.7%. This puts Carlton behind Central as the franchise with the largest revenue share; Central took 16.5% during 1999, a 0.5% points increase on 1998.

From January 1999 Central & North Scotland report as one area. This prohibits year on year comparisons.

Channels 4 and 5 were also subjected to the World Cup effect in 1998, resulting in relatively weak performances in April and May last year. The full figures are shown below:

Channel 5 continues build its business strongly during 1999, with revenues across the year increasing by 27% to £177.0 million. As with all channels, the autumn period was the strongest for C5 in terms of advertising revenue; however, these months also showed the relatively small year on year growth compared to the rest of the year.

A similar pattern emerges on satellite television, with a relatively weak month in May, but overall revenue growth coming in at 23.4% to £352.0 million.

Costs Per Thousand

Costs are up for all audience categories on ITV and Channel 4, with ABC1 Adults rising by 4.7% and 1.3 % respectively. On ITV it was the cost of reaching men that rose most sharply year on year, whilst C4’s Women and Housewives/Children are becoming more expensive.

Channel 5 became cheaper for all audience types bar Housewives/Children which rose by 5.8%.

Commercial Impacts

Commercial impacts on ITV were up for all audience categories year on year with ABC1 Adults increasing by 1.8%. The most significant impacts increases for the Network came from Women and Housewives, up by 2.6% and 2.7% respectively.

This is a much stronger performance for advertisers than has been achieved by ITV for the last few years, where most audience types have been showing declining commercial impacts.

Channel 4 is doing well delivering the all-important ABC1 Adults, with commercial impacts for this audience rising by 5.1% year on year. In contrast with ITV, impacts for Women and Housewives/Children both declined last year, by 0.3% and 0.9% respectively.

Channel 5 is showing more and more commercial impacts for advertisers, particularly in the ABC1 Adults category which grew by 37.4% year on year, the largest growth of all the audience types.

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A summary of the key news events from 1999 is available by clicking A Look Back At 1999….