TV Ad Industry Terrible At Marketing

Dave Morgan

Founder & CEO

Originally posted on MediaPost

If you bring up the topic of television among industry folks these days, you’re very likely to hear that the TV ad biz is on its last legs, with audiences and ad effectiveness evaporating into the ether of digital video, YouTube, smartphones and Facebook. Many say it’s only a matter of time until the multichannel TV package goes the way of the milkman. (For younger readers: Yes, there was once a time when you got your milk and butter delivered to your door early in the a.m. by local dairies.).

I believe that these perceptions are significantly out of touch with reality. The TV ad industry hasn’t been doing a very good job telling its story, extinguishing perceptions in the market that media users have abandoned TV and TV advertising for pure digital media.

I’m not a Luddite. I started in digital ad tech in the early 1990s and was there for the births of the banner, the ad server, the ad network and behavioral targeting. Today, however, I work at the intersection of digital and linear TV – and I am shocked at the disconnect between belief and reality among so many in our business today. Here are some of my favorites myths:

Belief: No one is watching TV, certainly not Millennials. Reality: According to the Nielsen Cross-Platform Report, the average American watches more than 34 hours of television every week, up more than 25% from 15 years ago. Not only do Millennials watch TV, they watch six times as much of it as they do digital video, and 35 times as much as they watch video on a smartphone.

Belief: TV viewing is collapsing; just look at the ratings of the top shows. Reality: Ratings of top shows have been declining for years and years, but not because viewership has been dropping – see the stat above documenting the 25% surge in viewing from 15 years ago. What is different is that viewers are watching many more different shows, on many more different networks, at many more different times. It’s called fragmentation. The Web was born with it, and TV now has it in a big way. Two-thirds of all TV viewing in the U.S. now occurs on an episode with a rating under 0.5. Yes, that’s two-thirds of all viewing!

YouTube is biggest platform today for video advertising. YouTube represents more than 50% of the digital video consumed in the U.S. today. However, as an RBC Capital Markets analyst has reported, the syndicated TV show Judge Judy will deliver twice as many U.S. audience ad minutes in one half hour as YouTube will deliver in a day. Now you know why she is paid so much. Just imagine if you compared the numbers for all of CBS versus YouTube.

Why do these perceptions persist?

First, many are crystal-balling it instead of paying attention to present events. There’s no question that Internet Protocol video is the long-term future of video entertainment and advertising. It’s easy sometimes to miss what’s happening now when everyone is focused on what might happen 10 years from now.

Second, the TV ad industry doesn’t market itself well, because it never needed to. It’s not used to an ad world where it’s not the bright shiny object. When the competition was print, radio and direct mail, TV’s sight, sound and motion made it sexy. Unfortunately for TV today, if you’re not a digital, mobile, social-first marketer, you’re not likely to get promoted.

Third, the TV ad industry is small and relatively insular. TV folks usually don’t talk to the broad advertising marketplace, but just to other people focused on the small screen. Only recently has the industry discovered the importance of putting digital folks into significant roles in their businesses. And TV folks spend more time fighting for share of TV ad budgets than fighting for a bigger industry share of marketing budgets overall.

What to do? It’s time for TV media owners to wake up and tell their story and be willing to take on the digital ad and marketing world on their own terms. This means talking about more than sex/age GRPs. It means measuring, accounting, and guaranteeing not just GRPs, but actual media outputs.

TV advertising’s unfair competitive advantage is its massive, fast reach and action-driving impact. It puts butts into seats. It moves products off shelves. It drives massive numbers of people to websites. TV needs to track all its ads from impression to impact and compete with pure digital channels on the numbers, not just on the past.

What do you think?

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