As Audience Reach Erodes, Some Networks -- Mainly Cable And CBS -- Fare Better Than Others

As advertisers and agencies wrap up their 2016-17 upfront negotiations, they might want to consider an analysis released this morning by an influential Wall Street analyst reviewing changes in the U.S. audience reach of Nielsen-rated TV networks. While ratings continue to serve as the currency that are the basis of most TV advertising deals, big TV advertisers still utilize media plans that seek to optimize the reach of viewers in the TV universe.

“While ratings tend to generate the bulk of focus in the press and among investors, reach metrics are often comparably important to the industry,” Pivotal Research Group analyst Brian Wieser writes in an analysis released this morning showing the rankings of 79 Nielsen-rated TV networks on the basis of their reach performance over the past 12 months.

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While most networks continued to lose reach due to the hyper-fragmentation of the media marketplace, some performed better than others on a relative basis. The analysis shows how each of the networks performed utilizing a simple average of the change in reach in the 12 months through June 2016.

While the major broadcast networks continue to deliver the greatest reach -- by a wide margin -- over their next-closest cable competitors, Wieser notes that "a handful of cable networks -- specifically TBS, TNT, FX, USA and AMX -- stand apart from the pack of cable networks given the broad appeal of the programming each runs, although monthly reach remains only around 50% for them."

That compares with a reach of about 80% for the Big 4 broadcast networks, but the major broadcast networks also happen to be losing relative reach at a rapid rate.

“There has been some erosion in reach over the past year of around 1.6%, although CBS has lost less relative to ABC, NBC and Fox,” Wieser notes, adding that with the exception of AMC, the broad appeal cable networks -- TBS, TNT, FX and USA -- all experienced significant losses of reach that were worse than industry averages.

Overall, Wieser says networks owned by Fox, AMC and Scripps “typically fared relatively better” than the average, while networks owned by VIacom generally lost the most relative reach.

“For advertisers, television budgets are typically optimized for reach and frequency,” Wieser writes, explaining the importance of the contribute each network makes to an advertiser’s audience reach delivery.

5 comments about "As Audience Reach Erodes, Some Networks -- Mainly Cable And CBS -- Fare Better Than Others".
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  1. Ed Papazian from Media Dynamics, July 25, 2016 at 10:59 a.m.

    Joe, are these average monthly reach levels and are they for adults, households or some particular demo?Thanks for any clarification you can provide.

  2. Joe Mandese from MediaPost, July 25, 2016 at 11:16 a.m.

    Ed - Here's how Brian Wieser describes the analysis: A data-set for each of 79 networks including household reach during the month of June 2016, a simple average of the change in reach over each of the prior 12 months and a ranking of relative performance on this basis follows in this note." He does not state wither it was for adults, households or a demo, but I'd assume it was either households or persons 2+.

  3. Ed Papazian from Media Dynamics Inc, July 25, 2016 at 12:24 p.m.

    Thanks, Joe. I'm guessing that its households----hoping I'm wrong.

  4. Haren Ghosh from Analytic Mix Inc., July 26, 2016 at 2:32 a.m.

    “For advertisers, television budgets are typically optimized for reach and frequency.” This is a problem today; agencies are using wrong metrics to optimize advertisers' TV budget. They are just taking general audience reach and using it against all brands, without even thinking through whether the general audience reach is relevant to the products they are in charge of. When we develop TV analytics models against brand specific ROI objectives, we clearly see the gap between what is being done and what should have been done.

  5. Jon Currie from Currie Communications, Inc. replied, July 30, 2016 at 4:14 p.m.

    If it is household reach, then by definition, wouldn't it have to be households?

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