National Spot TV Is Making a Big Comeback

However in this column during the past few months I have repeatedly noted that national spot TV share of spend has been on the riseIn my May 12 column prompted by my friend Tim Spengler I reported on the growth of adspend by insurance companies and noted a 262 rise in their investment in national spot TV in Q1 2021 year over year YOY according to the authoritative Standard Media Index SMIIn my June 3 post I noted that CPG advertisers upped their national spot TV investments 428 in Q1 2021 YOY Source SMIAnd in my May 20 article I observed the 2923 lift in online retailer investments in national spot TV Source SMISpeaking with my RMT partner and CEO Bill McKenna as well as friends in the business I discovered as I39d suspected that a goodly part of this expansion has been with nonlinear inventory such as ads delivered via OTT streaming apps supported by CTV and AVOD platformsMcKenna summarizes the situation thusly quotFor national advertisers including large retailers OTT is seen as an opportunity to efficiently improve audience targeting reducing wasted linear frequency and increasing conversions nationally and in local markets Augmenting national linear campaigns with OTT provides brands with new regional and local targeting capabilitiesamp160amp160amp160quotWhile OTT viewing has been progressively baked into the Nielsen national measurements for many years local Nielsen DMA panelbased measurement services have excluded Broadband Only Households ie cord cutters and other homes with no cablesatellite or local antenna reception on any HH TV set from the DMA TV universe definition According to published reports in October 2021 Nielsen is ending this practice when BBO homes with 5 minutes of local TV channel OTT viewing are to be added to local DMA Nielsen panels The immediate effect of this methodology change is an expansion of the DMA TV universe definition increasing the HUTPUT base for ratings calculations and adding OTT impressions Concurrent with the adoption of BBO homes in local DMAs the Nielsen local currency metric is expected to change from ratings to impressionsquotMultiple published studies confirm that today local market OTT viewing of ad supported programming occurs on TV network programs and selected affiliate news apps supported by custom media apps available on multiple platforms including AVODs and eMVPDs including CTV This insight portends an October 2021 reduction in local market ad inventories as expressed in target audience ratings and to a lesser extent target impressions when Nielsen adds BBO HHs to its panelbased local DMA measurement servicesquotLocal broadcasters especially independents need to understand the impact of these methodology changes adjust their pricing policies to meet the reduced local ad inventory convert guarantees to impressions CPM avails and increase their OTT program distribution within each station39s DMAquotAs ATSC 30 continues its rollout the value of spot inventory will potentially double mainly as a result of making it all addressable commercials capable of taking back response as easily as with digital and made accountable by the equivalent of quotset top box typequot data which can be matched to sales data and brand effects measured by the interactivity functions which enable surveysIt will be important to ensure that national spot is buyable programmatically and the sooner that happens the faster the comeback the national spot TV medium will make Reset Digital and RMT are already making linear TV buys programmaticThe biggest opportunity is for the US national spot TV industry to band together to finance a major educational campaign aimed at marketers agencies and other media companies to reteach them the importance of geographic targetingThe key point is that any brand39s ROAS varies by geographic market ROAS Return On Ad SpendThe reason that this is the case is that all brands and all innovations roll out following an Scurve and different geographic markets are at different points in that S curve at different times It makes no sense to throw ad dollars into toppedout markets The best place to put ad dollars are in markets in which your brand is in its fastgrowth phase RMT offers the predictive equation I developed with the ANA many years ago now called HYOPS for hyperlocal opportunities The model maps the geographies predicted to have the highest ROASIf you are a TV station owner or ad sales executive you need to find out which brands are in their fast growth stage in your market The education campaign recommended above needs to budget to license as much purchase data in as many product categories as possible to be used not only in trade and consumer advertising primarily aimed at national advertisers and their agencies but also by the ad sales forces of all stations participating in the education campaignYou will also want to license adtechmartech which makes it easy to help marketers and their agencies decide how to optimally allocate their ad spend by national and local media and to do that planning programmatically whereby activation may swiftly follow the whole process programmaticOne such platform already available is OptiBrain All the major digital media offer the ad buyer a portal through which to optimize and make the buy then track it and improve it in flight so why not TV TV networks that own TV stations are in a very good position to lead the charge in optimizing nationallocal buys for the buy side as an added value service And so are TV station groups and independent TV stationsPS In Erwin Ephron39s book Media Planning his first chapter quotThe Man Who Invented ADIsquot that was me contains the line quotThe ADI helped create the 11 billion national spot television mediumquot The whole point of the ADI and Nielsen39s subsequent DMA version was to be able to analyze and optimize the sales effects of any TV campaign However it has rarely been used for that so perhaps now is the timeClick the social buttons to share this content with your friends and colleaguesThe opinions and points of view expressed in this content are exclusively the views of the author andor subjects and do not necessarily represent the views of MediaVillagecomMyersBizNet Inc management or associated writers

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National Spot TV Is Making a Big Comeback

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Bill Harvey

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National Spot TV Is Making a Big Comeback

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