Why I Am Optimistic About the Traditional Television Companies

We can see this today as traditional television companies are entering streaming where the puck and the audience are going the right move for these companies to make Yet the economic profitability model they see in streaming is nowhere close to the way it was in linear for so longThis can certainly get strong people spooked It makes it appear that there is nowhere to go but downOne reason why the model does not seem to be there in streaming is because of the light commercial load Five minutes per hour is not 14 minutes per hourBut we all know hopefully that viewers are willing to pay for great content so AVODs Advertisingbased Video on Demand should all offer free access for up to 14 minutes ad load per hour a low subscription rate for five or so minutes per hour of ad load and a moderate subscription fee for almost no commercials at all or some variation on this theme that works to maintain television profitability at the traditional levelsHaving not seen evidence that television companies are actually testing such things in secret test markets it makes me optimistic to think that such testing will find solutionsA second reason Iamp8217m optimistic that the creators of content that is a level above usergenerated content will find solid footing for the future is that current trends in media research are bringing in much more information than we have ever had before as to how each media type works to benefit the advertiserFor example as seen in my articles here in MediaVillage Nielsen ONE Ads is showing that the only way to get campaign reaches in the 80s and 90s is to allocate around 80 of the video budget to linear plus network television streaming The traditional TV networks ought to be mining the heck out of Nielsen ONE Ads to ride this reach advantage and get the prices they need to carry on the business and make the best programs they have ever made As soon as they settle the strikes this is something to get done ASAPTake all the work that is now going on in the attention field for example It tends to show that television the longform leanback immersive experience greatly excels in attention and especially emotionKaren NelsonField was way ahead of everyone else in detecting the strength of the context effect of scrolling feed digital and user generated video shortforms Those media such as YouTube Facebook Instagram Tik Tok et al can affect memory in the one to two seconds they have the useramp8217s eyes on the ad but you canamp8217t tell a story in two seconds and without a story you are unlikely to get emotion other than annoyanceThese digital media are leanforward experiences quite different from switching gears and entering a fictional characteramp8217s story identifying with the character to have a vicarious alternate life experience As Karen says this imposes a ceiling on how much attention to expect in feed and shortform digitalIn fact in these media the context effect actually exceeds the creative effect unlike TV in which creative accounts for about half the ROI according to NCS Shades of Marshall McLuhan He said writing about television that the message has less effect than the medium itself and he was half right with TV but oh so 100 right about the digital mediaA biometric study presented at the Advertising Research Foundation ARF by Carl Marci and Foxamp8217s Audrey Steele showed that television has 38 times the emotional engagement effect as rich media display ads in digitalThe networks ought to be doubling and tripling down on these sorts of studies Not just to make the point about how much linear and network television streaming is worth and why to increase its share but also to learn how the get the most out of all media types And not just to be statesmanlike but also because there is nothing to stop the traditional TV companies from creating their own digital leanforward media but doing it even better than the existing first wave of digital media Imagine actors and writers and others under the TV tent becoming the most powerful Influencers on the planet Those altruistic actors and writers who go this way will have a very loud voice to make the world a better placeThese research studies to have the most positive realworld effect should be carried out in consultation with the ARF as scientifically as possible for example using random control trials Otherwise although the buy side and sell side can bring forth their own proofs no one will know what to believe in the C suite until the research itself can be vetted by truly objective expertsFinally not that there might not be lots of other factors to make the traditional television companies feel confident in the future there is addressable television The original Next Century Media NCM vision of addressable television still has not been materialized being able to buy the whole country including broadcast inventory as well as cablesatellite and streamingdigital addressably programmatically in a onestop shop against deterministic purchaser targets NCM showed it was possible in 1997 No one has put all those features together since thenOnce done right addressable will be an ROI powerhouse for the traditional TV companies The ability to addressably deliver immersive storytelling spots to targets who are really the moveable middle purchase prospects who also psychologically resonate with the ad that combination causing a leap in ROI will be a boost to network profitability As Byron Sharp would recommend the buys would be allocated so that all prospects would be reached with emphasis on the higher probability of yield prospects Byron would probably not recommend that latter part unless he has altered his thinkingNCM taught and the market has forgotten that addressable means that both buyer and seller can share immense benefits Both buyer and seller can increase their profits at the same time As if by magic but it is simple math A car company buys at 10 CPM but that is a 50 CPM against new car buyers If the seller makes addressable just to new car buyers cost 40 CPM the buyer saves 20 of media cost and the seller quadruples the take on those impressions and obviously both sides will negotiate to get that seesaw to balance more in their own direction and a balance will be found that is still highly positive for both sidesThe Calamity Jane attitude that has set back the traditional TV players should be washed away as soon as they do the math on addressable and set their armies in motion to set up the NCM version of addressable asap and globallyWhat will this do to digital Probably nothing Brands and agencies will quickly learn to start campaigns in TV with 30s move to 15s move to 6s and then move to digital 12 seconds Those 12second attention moments will bring back the punchline of the stories the user has already seen on TV and at low CPM those digital campaigns can remind people of the original 30second story and the emotions they felt when the first paid attention to itAnd of course radio outdoor and print will continue to offer other pathways into the cognitiondecision process maximizing the synergistic effect of all media togetherCarpe diemPosted at MediaVillage through the Thought Leadership selfpublishing platformClick the social buttons to share this story with colleagues and friendsThe opinions expressed here are the author39s views and do not necessarily represent the views of MediaVillageorgMyersBizNet

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Why I Am Optimistic About the Traditional Television Companies

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Bill Harvey

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Why I Am Optimistic About the Traditional Television Companies

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