The Association of Commercial Television

HERE’S WHY TV IS STILL THE MOST POWERFUL AD MEDIUM test

As the media landscape has fragmented with the emergence of new advertising mediums, the television has had to radically evolve over the past two decades. Due to these changes, many have speculated on the relevance of TV ads in a digital world, and if advertising dollars ought to be reallocated elsewhere. While TV is unrivaled for its sheer, unadulterated reach, the problem has historically been that it’s difficult to measure and optimize its true effectiveness. But that’s all changing.

Today, TV is a true performance-marketing channel – one that can be highly targeted, quickly measured and optimized in-flight, just like its digital counterparts.

TV is changing, not dying

Despite the sensational headlines announcing TV’s death, television still dominates our media consumption. Yes, the amount of time we watch has declined each year, but if you look at the data, it’s really only by a few minutes.

What has shifted dramatically is the delivery and consumption of TV content. In the past, you had to tune in live to catch your program of choice or you’d miss it entirely. With VHS tapes, people started manually recording their favorite shows to watch later. Then came TiVo and DVRs, and with them a “set it and forget it” mentality. Enter Netflix, Hulu, Prime Video and the like, and you can get a sense for how viewing habits have kept advertisers on their toes in terms of strategy and ad spend.

Success requires real-time insights

TV advertising, once used primarily for brand awareness, is now driving people directly into the customer journey via digital devices. According to Accenture, 87% of U.S. TV viewers watch with second-screen devices in hand or nearby. These “active participation” viewers can respond to a TV spot in an instant, whether its via search, site visits, app activity or online purchases. Not only are viewers responding via digital, but they are doing so quickly after a spot airs. This, in turn, has provided advertisers with a treasure trove of real-time data to inform their TV campaign strategies.

With the right tools, advertisers can adjust campaigns in-flight and use real-time spot and response data to know the aspects of buys that are performing best, and those that aren’t. Having access to faster feedback on TV ad campaigns means knowing the buy elements that will lead to the best real-world response. This constant flow of information can then be used to continuously inform more targeted buys.

New metrics for measuring TV success

The old-school metrics of impressions and ratings can still be helpful in determining where to allocate funds, but to take full advantage of TV’s potential, advertisers need to tie TV initiatives directly to business outcomes. Success should be measured through brand-specific key performance indicators (KPIs), and the campaign must be optimized to benefit the most critical metric to your brand.

The question advertisers should ask is: “What is the real-world response I desire from my target audience?” If sales are the goal, then the campaign should be optimized accordingly as you look at accurate, same-day insights that tell you whether or not those online purchase journeys are happening in the minutes after your spot airs. And the immediate impact of TV isn’t the only thing that can be measured. Advertisers are increasingly quantifying the long-term impact of TV: how a spot drove interest in the days, weeks and even months after its airing.

If advertisers want a competitive edge in TV advertising, they need accurate, real-time data to understand if and how spots are resonating. Being able to attribute viewer actions, such as site visits, downloads, purchases, search activity, etc., directly to a TV spot is a powerful way to gain momentum as advertisers build the most effective campaigns possible.

Daniel Gulick is a head of customer success at TVSquared, a TV performance analytics and optimization company.

 

Source: https://www.smartbrief.com/original/2018/08/heres-why-tv-still-most-powerful-ad-medium

TV AD SPEND APPEARS TO BOOST DIGITAL KPIS FOR AUTO BRANDS test

Automakers that increased TV ad spending in the fourth quarter of 2017 saw a statistically significant boost in digital key performance indicators (KPIs), including unique visitors and search.

According to a new report from the Video Advertising Bureau that examined 25 domestic and foreign automotive brands, 19 brands had a positive or negative correlation between TV ad spend and website traffic, with only six brands not having a clear correlation.

Of the 19 brands that had a correlation, 11 increased their TV ad spend year over year by an average of 15%, and saw website unique visitors rise by 48% on average. The other eight advertisers reduced their TV ad spend by an average of 15%, and saw their website unique visitors decline by an average of 28%.

That correlation continued when TV ad spend was compared to search queries. The VAB report found that the more automakers increased their TV ad spend, the more consumers searched online for more information about them.

As an example, Toyota increased TV ad spend by 10%, and saw its search queries increase by 31%. Land Rover meanwhile raised its TV ad spend by 45%, and saw its search queries rise by 170% year over year.

The report found similar results among automakers that reduced their TV ad spend, with search queries falling accordingly.

The correlation between TV ad spend and KPIs continued when the VAB examined “social chatter” around automotive brands, with auto brands that increased TV spending seeing social engagements rise.

The VAB report is meant to underscore how TV and digital advertising complement one another just as much as they compete with one another. While many marketers are shifting ad dollars to digital, the VAB’s data suggests that those digital dollars could be made more effective when paired with a TV campaign.

 

Source: https://www.mediapost.com/publications/article/323651/tv-ad-spend-appears-to-boost-digital-kpis-for-auto.html

THE FUTURE OF TELEVISION IS … MORE TELEVISION test

CALL IT JEFFREY Katzenberg’s unicorn newborn. An operating company has come into being, ex nihilo, with the blandest of names—NewTV—and a valuation north of $1 billion. That’s something that has never happened before. Another thing that hasn’t happened before: the very first funding round for the company managed to reach the $1 billion mark. NewTV, then, is no scrappy startup. Rather, it is, from day one, an enormous privately owned corporation, run by a deeply experienced CEO, Meg Whitman, who formerly ran eBay and Hewlett-Packard.

And it’s probably going to fail.

Even at this unprecedented and mind-boggling scale, NewTV is a minnow, and TV as an industry has proved itself, in an era of disruption, to be surprisingly robust and resilient.

We live in an era where Netflix is eating the world, where kids and grown-ups alike can disappear down a YouTube rabbit hole for hours on end, where the amount of time we spend watching video on our phones only ever goes up rather than down. In that world, it’s easy to extrapolate to a time where old-fashioned television is dead, killed off by a slew of younger, nimbler disruptors. The reality, however, is that TV’s business model is secure, its revenues are gargantuan, and the barriers to enter its industry have never been higher.

Even Katzenberg knows this. A billion dollars is only half of the $2 billion he was originally asking for. And even $2 billion would be small table stakes at this game. After all, Netflix is spending some $12 billion a year in service of disrupting television. (The best articulation of Netflix’s ambitions can be found in this great piece by Matthew Ball.)

Netflix has vastly deeper pockets than NewTV. But even Netflix is going to find it incredibly difficult to replace TV altogether, for the simple reason that there’s simply too much money there. TV is, at heart, in the advertising business—advertisers spend some $70 billion a year on TV. While ad dollars have fled print media, the TV ad-revenue stream has stayed astonishingly steady. Yes, all the advertising growth globally is in digital, mostly through Google and Facebook. Digital advertising has, finally, overtaken TV as the largest ad market. But there are good reasons why TV’s central position in America’s households is much more deeply rooted than the would-be digital usurpers like to believe.

As Alexis Madrigal notes, Americans still watch a dizzying quantity of linear TV, and they don’t seem remotely unhappy with it. In the multi-trillion-dollar fight for America’s national attention, linear TV makes even Google and Facebook look like minnows. According to Nielsen, American adults spent 45 minutes a day on social networking, down slightly from six months earlier; they also spent 25 minutes a day watching video on their phones, tablets, and computers. By contrast, they spent 4 hours and 46 minutes a day watching TV, which was up 21 minutes per day from six months earlier.

That explains why the stakes—and the barriers to entry—are so high. All of those advertising dollars flow to TV companies, who are not going to give it up without a massive fight.

But even if ratings decline, TV remains the only realistic way for companies, especially if they make consumer packaged goods, to showcase their brands in front of the people who do America’s shopping. Soap operas are so called because they were originally sponsored by soap companies, and to this day, if you want to reinforce the brand values of a soap, the first place you’re going to turn is TV, because TV’s ability to build and maintain a brand is unrivaled. You can reach the same audience with the same message dozens or even hundreds of times; you can craft that message carefully and serve it up without accompanying distractions; you can take your time to tell a story over the course of 30 seconds, in a medium where 30 seconds is a short time rather than an eternity.

While TV is excellent at burnishing the brand of a dishwashing powder, its would-be disruptors are dreadful at it; Netflix, for one, doesn’t have any advertising at all. That keeps the ad dollars in the old economy of linear TV, where they are recycled into the kind of glossy, expensive, compelling shows that have had no trouble surviving and even thriving in the new attention economy. As Netflix has discovered, it takes many billions of dollars to create content that can begin to compete with television.

It’s eminently possible for an entire medium to lose the attention wars: We’ve already seen that happen with print. People spend much less time reading physical newspapers and magazines than they used to, with the result that those ad dollars ended up migrating to exciting new digital platforms. But TV is going to be much harder to kill than print was. A newspaper article in web-page form is faster, cheaper, and more convenient than in print form. TV doesn’t work that way: It’s a lean-back, experiential medium where people like to waste time. It’s not an information-delivery mechanism; it’s an entertainment format that has been perfected and optimized over many decades.

Felix Salmon (@felixsalmon) is an Ideas contributor for WIRED. He hosts the Slate Money podcast and the Cause & Effect blog. Previously he was a finance blogger at Reuters and at Condé Nast Portfolio.

 

Source: https://www.wired.com/story/netflix-new-tv-television-future-jeffrey-katzenberg/

WHY BIG TECH SPENDS BIG ON TV test

If you read the trades regularly, there’s a good chance you’ve read that TV is dying. It’s less likely you read that Google, Netflix, and Amazon collectively spent more than $1B on TV advertising in 2017.1

Can both of those things be true? Why would tech giants spend so much on a dying medium?

At times like this, it’s best to fall back on the old maxim that says “don’t believe everything you read.

“During October 2017, Google spent $17M more on TV than Target and Walmart combined.”

For years the headlines have been telling us that TV is dying, and as a result, many people believe it. In fact, according to the Video Ad Spend study released by the IAB in April of this year, 66% of advertisers are shifting funds from TV to cover increases in digital video spend.

As we’ve written before, however, headlines don’t tell the whole story. And in this particular case, even a cursory look beneath the surface shows that TV is not even close to dying. On average, Americans spend 4.5+ hours watching TV a day.2 That’s over four times more than they spend watching YouTube, Twitch, Netflix, Hulu, Amazon, and all other digital video combined.3

Thought millennials were always on their phones? The generation proclaimed to be cutting the cord en masse spends 2.8x more time watching live or time shifted TV than they spend engaging with social media on their phones.4 And, out of their total TV usage, only 18% is spent streaming video.5 Again, don’t believe everything you read.

Now, about that claim that Google, Netflix, and Amazon spent $1B on TV advertising. Given the numbers above about how much time people actually spend with TV, it probably won’t surprise you to learn that this is actually true. In fact, during October 2017, Google spent $17M more on TV than Target and Walmart combined.6

But is the fact that people watch a lot of TV enough to demand such a massive expenditure from just three companies? Not anymore. The reach and scale of TV has been unmatched for decades, but in this era of fragmentation, where audiences have become spread out across hundreds of channels, it’s become harder for brands to reach large portions of their audience with traditional advertising methods.

So why do the tech giants spend so much on TV? Because they know it works, and they can prove it. Digital-native companies are hyper-focused on being able to prove their return on ad spend (ROAS). This knowledge helps them determine which channels to invest in, where to allocate resources, and how to optimize future campaigns. Until recently, digital was the only channel that offered this level of measurement.

Today, advanced TV platforms can help brands reach their target audience much more efficiently, with media plans often featuring thousands of spots across upwards of 50 networks. What’s more, some platforms have measurement capabilities that allow brands to know exactly who saw their ad and what action they took as a result. The learnings derived from this data, as well as those from subsequent campaigns, can be applied to make TV advertising more efficient than ever.

It’s not just the tech companies that are taking notice, either. Unlike most companies who are moving dollars from TV to digital as noted above, last year, Procter & Gamble—citing wasted impressions and questions of brand safety—made news when they announced that they’d be taking $200M out of digital and putting it into TV. What happened? They increased their reach by 10%.7

Traditional brands and digital-natives alike can take a cue from these giants of industry. They know that with the right advanced TV platform they can reach more of their audience, more efficiently than ever before. And they know that by proving the impact of their campaigns on business outcomes and optimizing accordingly, they can turn TV into a growth engine for their companies.

Not bad for a dying medium. Remember, don’t believe everything you read.


1 Based on Kantar/Ad Intel data.
2 Nielsen Audience Report Q1 2018
3 Nielsen Audience Report Q1 2018
4 Nielsen Audience Report Q1 2018
5 Nielsen Audience Report Q1 2018
6 Based on Kantar/Ad Intel data.
7 AdWeek, When Procter & Gamble Cut $200 Million in Digital Ad Spend, It Increased Its Reach 10%

 

Source: https://www.simulmedia.com/blog/2018/08/09/why-tech-giants-spend-tv/