May 29, 2013
As seen on Business Insider
Television is going through a complete transformation—or several transformations at once. As viewers move beyond traditional broadcast models to consume media in new ways, marketers are scrambling to adapt so they don’t get left behind.
Advertising up-fronts and traditional network buys will likely always have a role to play, but to reach the right audiences in the right way, brands and marketers have to understand the implications of the new TV landscape and develop new strategies that reflect the way we watch now.
Cord-cutting is already mainstream – Nielsen reported last month that more than 5 million U.S. households use non-TV devices and services to get their content, a 150% increase over the past six years. With its all-at-once release of a full season of “House of Cards” in February, Netflix expanded binge watching from a way to catch up on past seasons to an option for new programming—a move that makes the notion of a standard September-to-May TV season seem quaint and outdated. And dual-screen experiences delivered via TV and mobile devices in tandem promise even greater innovation to come.
In principle, these changes are good for marketers, providing new opportunities for deeper viewer engagement. As people take more control over what, when, and how they watch, they become more invested in the experience and engage more actively. The increased interactivity available online and on handheld opens the door to direct participation in the experience, from games to social media to commerce.
The online dimension also supports targeting in ways traditional TV never could, making it possible for marketers to use data from ad exchanges to find the right consumers wherever they are and however they consume content.
While this creates a new wealth of actionable data for marketers to use, the transformation of TV poses a significant threat to traditional marketing. How can brands avoid disintermediation when people aren’t exposed to ads in the traditional way, and instead can easily skip past TV ad pods, defect to non-broadcast platforms, or opt for pay-per-view streams and downloads that eliminate ads entirely? Most fundamentally, how do brands reach the young, money-spending consumers who are abandoning traditional TV en masse?
Looking Beyond the Generalizations
The first step for marketers adapting to the new world of TV is to research exactly what it means for business. The viewing audience isn’t just changing form; it’s also fragmenting and diversifying rapidly. For every consumer who cuts the cord and makes do with a single screen, there may be another who prefers multi-tasking or second-screening and wouldn’t think of abandoning their incumbent pay service.
Sports fans can be reluctant to give up the live broadcasts available on cable and satellite, and casual entertainment viewers who primarily watch television series and movies have no need for a service beyond Netflix, Slingbox or Apple TV. One brand’s target audience might favor short clips of online video, accessing them periodically throughout the day on mobile, while another’s base might prefer long-form prestige programming, served to a flat-screen over a laptop’s HDMI port.
More broadly, what other trends in user behavior and economic activity might have interesting implications or applications? M-commerce continues to grow in sophistication and popularity, as consumers go beyond browsing and price-checking to complete transactions via handheld; is there an opportunity to deliver second-screen campaigns with buy-now features? Travelers who have boarding passes sent to their smartphones for paperless check-in might be the perfect targets for offers from hotels and restaurants in their destination city to campaigns designed around romantic getaways, business travel, or family fun.
Each of these viewer profiles implies a distinct set of attributes and capabilities, from the number and size of the screens they use, to the availability of interactivity, to the duration of their viewing sessions and their tolerance for ads. Go beyond the generalizations about today’s audience to find out what emerging habits actually look like.
Invest, Test, Repeat
Whatever forms the viewing audience assumes in the coming months and years, one thing is already certain: mobile will be more important for virtually every type of viewer. As people abandon traditional TV habits, brands and marketers have must be ready to follow them with ads, offers, and other campaigns delivered via mobile.
At Velti, many of our brands have seen that mobile offers new kinds of engagement to explore: dual-screen promotions that pair mobile contests, games, and commerce with TV content; mobile communities around binge-watching shows; m-commerce opportunities linked to filmed or live content; native advertising and content marketing that make branded messages the main attraction. While brands expand strategic vision, they’ll also need to rebalance resources and deepen investment in mobile marketing technology, targeting, and expertise to reflect its increasing performance.
The shift in consumer mindset from traditional TV to mobile, on-demand content is pushing the advertising industry toward a shift of its own from mass TV advertising to more targeted, interactive, and engaging mobile tactics. We’re just at the tipping point, and the future looks exceptionally bright for those who can adapt to the changing rules of TV.