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ITV expects advertising bump from winter World Cup

Broadcaster ITV has said it expects an advertising bump over the coming months as the World Cup is broadcast in the UK.

The business said it thinks that November advertising revenue will rise 3%, and December will be up between 5% and 10% compared to last year.

But it will not offset an overall decline in ad spending by ITV’s customers during the year.

The business said that ads had been more of a struggle this year than last, declining 2% in the first nine months, especially as the Euros were broadcast during last year’s summer months.

In August alone, advertising revenue fell by 21% compared to the month before, ITV revealed, while July and September also saw heavy falls.

“Traditional broadcast advertising spots are simply never going to regain their popularity,” said Hargreaves Lansdown analyst Sophie Lund-Yates.

“Primetime hits like I’m A Celebrity will boost things in the short term, but these highly popular shows are too few and far between for this to be enough.”

She said that the company’s digital plans – including the launch of new streaming service ITVX – will make up some of the lost ground, but it is still a small part of the company.

While ad revenue for the media and entertainment business dropped 2% to a little under £1.6 billion, digital ad spending rose 13%, but only made up £227 million in the nine months to the end of September.

“Video on demand and streaming progress has been admirable and no one can dispute ITV’s willingness to grasp the nettle,” Ms Lund-Yates added.

“The question is whether ITV’s digital schemes can build enough scale and popularity, fast enough. In today’s fiercely competitive landscape, there simply may not be enough spare eyeballs to go around.”

ITV’s studios division showed much more positive results on Wednesday. ITV revealed that revenue in the programme-making part of the business soared by 16% to £1.4 billion.

Largely as a result of that, the company’s non-advertising revenue was more than half of the company’s total.

Chief executive Carolyn McCall said: “ITV Studios continues to outperform the growing content market and will exceed 2019 revenues in 2022.

“It’s on track to deliver on all of its KPI (key performance indicator) targets and has a formidable slate to power it into 2023 as we further diversify the business by genre, geography and customer.

“We are making good progress on our new, free, ad-funded streaming service ITVX, which will be rolled out across devices and platforms in the coming weeks with the full launch of new and exclusive content on 8th December, in time to reach millions of viewers who will come to ITV for the Fifa World Cup.”