He said viewer numbers in Australia and South Africa were concerning in the first year of the expanded competition, then "plummeted" this season.
In addition, he said market research had shown fans were concerned about too many lopsided mismatches, reinforcing the need to revamp the competition.
Under the new structure, there will be 15 teams, with two cut from South Africa - rumoured to be the Kings and Cheetahs - and one from Australia - either the Force or Rebels.
Two of the teams introduced last year, Argentina's Jaguares and the Sunwolves of Japan, will remain.
Tew said South Africa had "taken note of reality" by agreeing to reduce its teams from six to four amid financial pressures and difficulty retaining top players.
When the 18-team blueprint was released in 2014, Tew was among those touting the possibility of even more expansion further into Asia and North America.
But he conceded it was now apparent that Super Rugby had been too "bullish" in taking the game to new frontiers.
Tew expressed sympathy for the teams facing the axe.
"Just think about the human element," he said.
"You've got fans, you've got established team structures, you've got players and families, there's a whole lot of stuff going on."