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Political TV Ad Revenue Expected to Reach $22 Billion in 2006"

31 May, 2006 Response This Week

NEW YORK – reports that revenue from political television advertising will increase by more than 7 percent and generate an estimated $22.2 billion, according to projections by BIA Financial Network. The gain is expected to offset 2005’s TV revenue decline of 7.5 percent, and “reinforces” local television’s dependence on the political campaign cycle.

Mark Fratrik, vice president of BIA, told Brandweek, “Whereas the market used to be able to count on automotive advertisers increasing advertising expenditures every year, in some cases we’re seeing those additional dollars moving to other, more contemporary [media], and television broadcasters have to rely on political advertising in even-numbered years for any meaningful annual revenue growth.”

Of course, while local TV networks welcome political advertising, those ads clog up space for direct response media buyers. Election cycles, especially the spring primary season that has been hampering DR media efforts throughout the second quarter, chew up much of the remnant space that DR short-form buyers are used to getting on the cheap.

While record media buying results for the DR world appear to have extended their 2005 run into the first quarter of 2006, many media leaders in the DR space have told Response that results since the dawn of the second quarter in April have been surprisingly poor.

“Local TV stations are in precarious positions and must think creatively to drum up new revenue streams,” Fratrik added.

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