It’s well known that, more than ever, consumers of video content are turning to digital and streaming platforms and watching it on screens of all sizes. It turns out it is now a global phenomenon — one that has led to the worldwide shrinking of linear television ad spend, new data from WARC show.
WARC’s latest Global Ad Trends report, “The Changing Shape of TV,” finds that television media is changing across Earth as audiences shift from linear TV to connected TV. This led WARC to explore a decade of ad spend data to understand “the decline in linear TV and the reactive rise” of Connected TV.
WARC also sought to explain why definitions of “TV” are fracturing and what will shape its future.
The big takeaway?
- Linear TV represents just 12.4% of global ad spend, down from 41.3% in 2013.
Alex Brownsell, Head of Content at WARC Media, comments, “There’s no doubt that Linear TV’s role is slowly waning, both in viewing and ad spend, as audiences shift to the expanding ecosystem of Connected TV. However, new players such as ‘Big Tech’ and retail media sellers hope TV can help them win brand dollars, and smart TV makers are creating their own ad-funded TV channels.”
Nevertheless, the findings could lead some in the U.S. broadcast television industry — one at the precipice of a major technological and ownership evolution — to run to the store for quick relief from a bottle of Kaopectate.
Brownsell says, “As consumers move seamlessly from one form of video to the next, advertisers are being challenged to reappraise how they define TV — be it a specific type of video ad format, a media owner or simply the largest screen in the home — with important implications for planning and buying, frequency management and measurement.”
Between 2014 and 2024, linear TV ad spend worldwide declined by 27.5% in absolute terms — extending to a 50.8% drop when adjusting for inflation. There are sector variations: linear TV spend for tech and electronics has fallen by 42%, while household and domestic products have increased by 12%.
While Linear TV still commands more than three-quarters of all TV investment, “however, increasingly brands are rebalancing TV spend towards Connected TV, which now accounts for nearly half of all TV usage in the U.S.,” WARC says, citing Nielsen.
The total video market, excluding social video and YouTube, is forecast to take a 15.9% share of spend in 2025, per WARC Media forecasts.
Meanwhile, there is a rise in linear TV costs being seen globally, and the U.S. is the pacesetter, WARC concludes.
“The decline in user reach has been accompanied by an acceleration in advertising costs,” it says. “While analysis shows a clear upwards trend in global average TV CPMs, that increase is especially pronounced in the U.S., Germany and UK.”
In markets like Brazil and Japan, linear TV CPMs are lower today than they were in 2012, according to figures from WARC Media, the World Federation of Advertisers and ECI Media Management.
YOUTUBE: ‘THE NEW TV’?
Consumers easily switch between video distributors and devices, but for advertisers, the definition of TV has never been more contested. Google’s YouTube is making a concerted play for TV ad dollars. “The platform earns a rapidly growing amount of revenue from ads displayed on Connected TV screens, and TV companies themselves are looking to boost monetization by distributing content on YouTube,” WARC says.
In 2024, YouTube earned $36 billion in ad sales across devices, more than the “Big Four” broadcast networks combined.
And, if there’s any doubt that YouTube has its sights on Paramount+, Peacock, Disney+ and even FOX, consider this from WARC: “The platform is looking to acquire sports IP to sustain this momentum and expand into sitcom-style programming,” it says.
How that unfolds will likely be closely watched by broadcast TV industry leaders. That said, WARC concludes, “In a world where Big Tech speaks directly to CFOs in the language of growth, TV ad sellers wish to prove outcomes, not just exposures. The industry requires more standardized and robust measurement across all forms of TV.”
This leads WARC to outline the forces that are shaping TV’s future.
“The next decade in TV will be defined by data convergence, device gatekeepers, platform-fit creative, and new buying models,” it says.
- Retail data fuels pivot to performance
The integration of retail data with TV promises to redefine how brands approach campaigns. “By next year, global retail media spend is forecast to exceed the total TV market,” WARC Media says. “Retailers may increasingly assume the role of senior partners, with TV services an upper-funnel arm amidst a full-funnel proposition. Broadcasters know that reach and frequency are no longer enough. Retail data can help TV to prove outcomes, and not just exposures.”
- TV’s shift in creative
Less standardization of non-broadcast ad formats means fewer reasons to treat the 30-second spot as default. Some brands are experimenting with interactivity like QR codes, shoppable overlays, and gaming integrations. AI will also be a disruptor.
- TV’s small business opportunity
Small brands are a key target for TV media owners. The largest brands in the world spend on average 38% of ad budgets on TV; among smaller brands that falls to 9%. A shift to programmatic selling in Connected TV may open the medium to a new share of advertisers.
Editor’s Note: References to “CTV” have been changed to “Connected TV” to avoid any confusion with Bell Media’s CTV broadcast network in Canada.
