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What: Standard Media Index has released market actuals and updated media forecasts through 2023. SMI expects the full U.S. advertising marketplace to expand by 8% in 2019.
Why it matters: The TV market is heavily concentrated; the top seven media owners account for 84% of ad spend season-to-date. Through April 2019, upfront revenue is down 0.5% annually. On a two-year basis, upfront revenue was down 3.6% on an average weekly basis.

According to Standard Media Index’s forecasts, U.S. advertising could expand by 8% in 2019 excluding cyclical events like the Olympics and World Cup. While major marketers are anticipated to grow a mere 2.5%, small and medium-sized businesses (SMB), who generally self-manage their ad spending through digital tools, will grow by nearly 14%.

SMI has noted that major marketers have limited incremental investments in search to a +1.6% growth level through the first four months of 2019, down from double-digit growth in 2018. Similarly, incremental investment in social has been reduced to +24% growth level through the first four months of the year from +50% in the same period last year. According to SMI, social grew by over US $150 million in the January to April period in 2018, while in 2019 that figure was “only” US $25 million.

Ad formats across all digital platforms are showing long-term growth. On a two-year CAGR basis, audio is up 7%, search is up 10%, display (driven by social) is up 11%, but video tops the list with growth at 15%. Actually, video is the dominant content and ad format in the U.S. among major marketers, as 63% of ad spending is being invested with video publishers or, growingly, digital video ads on non-video publishing.

SMI points out that the TV market is heavily concentrated; the top seven media owners account for 84% of ad spend season-to-date (Oct. 2018 – Apr. 2019). However, the actual delivery of the 2018-2019 season-to-date is not experiencing the level of advertising activity expected last summer, when it was reported upfront demand was between +3% to +4% overall. In reality, through April 2019, upfront revenue is down 0.5% annually. On a two-year basis, upfront revenue was down 3.6% on an average weekly basis.

 

Top Media Owners (2019-to-date)
10.5%Google
10.4%(new) Walt Disney
9.2%NBC Universal
8.6%CBS Corp.
5.5%AT&T (incl. WarnerMedia)
4.8%Facebook
4.2%(new) FOX Corp.
3.8%Discovery
3.7%Viacom
1.9%Microsoft

What: Azteca America, a U.S.-based, Spanish-language network wholly-owned by HC2 Network Inc., a subsidiary of HC2 Holdings, Inc. (NYSE: HCHC), unveiled its 2018-2019 programming line-up at its annual upfront presentation in New York City. We talked to Craig Geller, Executive VP, Network Sales, Digital, and Marketing, about what’s next for Azteca America this year.
Why it matters: Azteca America enters this upfront season on the heels of a recent acquisition by HC2 Network Inc., which provides expanded distribution and scale across its linear and digital channels.

As part of this year’s upfront season, Azteca America presented its programming for this year in New York City. Among their new offering, they will have a few original series including a reality show, updated findings from a recent Nielsen study, a network-wide initiative celebrating Hispanic women in the U.S., and the return of the Miss Universe competition to the network. Portada talked to Craig Geller, Executive Vice President, Network Sales, Digital and Marketing at Azteca America, to find out what’s next for their positioning after the HC2 acquisition.

Portada: Azteca America is now owned by HC2. In what way has Azteca America’s positioning/ strategy changed as a result of this?

Craig Geller: “Our positioning and our strategy of strength, stability and scalability have not changed. What has changed, is the ability to execute against that plan with a company that wants to bring valuable content, grow the viewership and solidify the organization’s competitive positioning for the changing media landscape.”

Portada: In your experience, how has the Hispanic marketing landscape evolved over the last years?

C.G.: “The Hispanic media landscape has changed in that today versus years ago, there are so many more choices for consumers. Choices used to be limited but this has evolved. Choice has led to change, change has led to opportunity and opportunity has led to growth.” 

Portada: What has been Azteca America’s role in this evolution?

C.G.: “Our role is to provide opportunity and choice not just to the viewer, but also to the advertisers. In addition, our counterprogramming strategy distinctly separates us from our competition and our ability to provide impactful solutions to advertisers has resonated and worked.” 

Portada: Which are the opportunities when targeting Spanish-speaking audiences in the U.S?

C.G.: “Anytime that you can connect with this viewer, you earn a loyal consumer. Data shows us that there is a tremendous opportunity to reach and connect with the U.S. Latina as well as with U.S. Millennials.”

Portada: Which are the salient features of Azteca America’s offering at the upfronts in terms of programming?

C.G.: “We will continue our counterprogramming strategy that has been a success for Azteca in past years. We want to provide our audience with the greatest in entertainment, from game showand reality series to scripted series and novelas, as well as news and sports, anywhere, anytime and on any screen.”

Azteca America is willing to take calculated risks that create opportunities for our advertisers and partners to engage deeper with our audience leading to growth.

Portada: What distinguishes Azteca America’s offering from its competitors?

C.G.: “Azteca America today is well positioned versus our competition to actually capture and grow the audience in that we can take the best of what TV Azteca in Mexico has to offerproduce our own original content and purchase content that has already run in Latin America and that has had proven success. This is our competitive advantage. Azteca America is willing to take calculated risks that create opportunities for our advertisers and partners to engage deeper with our audience leading to growth.”

Portada: Do you distinguish between digital (OTT) offering and linear broadcast offering when working with your clients?

C.G.: “Providing an audience to a client is agnostic to the screen. The difference is the way that agencies are aligned. Our offerings have to be defined because the way that the agencies look to purchase audience may be siloed. What that says is that not everybody is a video investment buyer. You may have someone who buys digital and someone who buys TV. More and more those people are being more aligned to just buy video, but today it’s not a one-size-fits-all in terms of how the agencies are structured to go out and buy video content.” 

Portada: Do you have programming around the 2018 World Cup?

C.G.: “As part of our programming agreement with TV Azteca, we will be airing “Pasión Rusia,” on Azteca America. In addition, our website will have a dedicated page to the global sporting event. Through our partnership with Mexico’s popular sports magazine, Fútbol Total and the contributions of EFE journalists covering the event, we will be able to bring the excitement and passion to our viewers this summer.

This is a prime example of how we continue to leverage our relationship with TV Azteca, providing a competitive edge.” 

Portada: What is the role of data analytics in Azteca’s programming plans?

C.G.: “Data science and market intelligence play an integral role in our programming strategy. Understanding the viewers’ journey, their tastes and desires in terms of content, is always going to be at the forefront of everything we do.” 

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