Tag Archives: Digital strategy

Fading To Black?

Over the last couple of years I’ve written about cord-cutting and today I have another update of sorts.  As you know, this refers to people disconnecting from a “traditional” video provider such as a cable or satellite service and using only content delivered to the via “over-the-top” services – things that sit on top of a broadband connection.  These are services such as Netflix, Hulu, Amazon Video, and others.

Here is what caught my eye:

Thirteen of largest multichannel video providers in the U.S. — about 94% of the market (94.6 million subscribers) — lost about 345,000 net additional video subscribers in 2Q 2013 — down 0.4%, according to the Durham, N.H.-based Leichtman Research Group…The top nine cable companies lost about 555,000 video subscribers in second-quarter 2013, compared to a loss of about 540,000 subscribers in the second quarter of 2012…Bruce Leichtman, president and principal analyst for Leichtman Research Group, stated: “The multichannel video industry has leveled off, with major providers losing about 0.1% of all subscribers over the past year.”

OK, so not exactly a massive disconnect.  On the other hand, the trend is accelerating by most accounts, especially among younger people.  Now let’s think about the ongoing battle between Time Warner Cable and CBS.  No matter which side you’re on, it gives people the opportunity to seek alternatives, at least with respect to CBS and Showtime programming.  Once they figure out that much of the content is available elsewhere, cutting the cord becomes more viable.

Another anecdote.  This past weekend, I wanted to watch the Solheim Cup golf matches.  The place in which we were staying didn’t get the network carrying the matches and the live streaming via YouTube was not available in the US.  Solution?  I watched on a proxy server in Europe.  Not some sort of illegal torrent – simply a proxy server so they thought I was in France.  For those of us who are a bit more technically minded (and I think anyone under 30 fits the bill), this is a form of cord cutting behavior and negates the need for anything more that a high-speed connection to watch what I want on my own schedule.

Finally, some more research from STRATA shows that none of this is going unnoticed by the marketing community:

Focus on television advertising has hit a three-year low as the gap between TV and digital narrowed to its closest point ever, according to the most recent quarterly survey compiled by STRATA…TV advertising still remains the top advertising medium with 44% of survey respondents saying they are more interested in advertising on TV (spot TV/cable) than any other medium. While TV is still number one, this represents the lowest level of broadcast advertising interest seen in the STRATA quarterly survey in nearly three years. Gaining steadily on TV, digital is the second most popular medium at 35%…28% feel they will have a greater spend in Digital than Traditional in 1-3 years. 27% say they don’t ever anticipate a greater spend in Digital (down 45% and the lowest percentage ever).

Ad spending is a big part of the fuel that drives these businesses (and the Time Warner/CBS dispute points out the relatively new other piece – transmission fees).  If that piece shrinks, along with viewers and subscribers, the industry is in big trouble.  As the Chinese say, “interesting times”.

Your take?

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Filed under digital media, Reality checks, What's Going On

Is Streaming Hurting Traditional TV?

Once in a while a piece of research shows up that’s just confusing and such was the case the other day.  GfK Research has been doing annual surveys of network TV viewing for the past six years and the seventh iteration has produced some data that I can’t quite figure out.  Maybe you can help me.

Diagram of Streaming Multicast

(Photo credit: Wikipedia)

Over the last seven years:

the proportion of those who say they “expect to be able to watch my favorite shows on a device of my choice” has nearly doubled, from 19% in 2006 to 34% now. But those who watch network programs via streaming options are now more likely to say that this erodes their “traditional” viewing of the same shows. One in three (33%) report that they watch less “regular” TV as a result of streaming viewing, compared to one in four (24%) who say they watch more — a net differential of -9 percentage points.

In other words, viewers expect the networks to hand them the weapon with which the viewers murder the nets’ business.  After all, if they’re watching less, there are fewer eyeballs to sell.  It’s the old “trading analog dollars for digital dimes” argument.  But let’s turn to the man (Jeff Zucker, then of NBC, now of CNN) who made that argument and gain a bit of insight into the research:

“We believe in ubiquitous distribution, we want our content to be available everywhere,” Zucker said, also noting that “We’re not afraid to try things and stop them.”

He continued: “What we’ve lost in terms of viewers and ad dollars on the traditional analog systems is not being made up for on the digital side. Until we do that, there’s a risk to all our business plans,” said Zucker.

So actually, it seems that what the research is saying is not that interest in what the networks are airing is lessening – quite the contrary.  27% of those who use streaming or downloaded video now say that they “watch a greater number” of shows because of these options — more than double the 2006 figure of 12%. And 21% report that they spend more time watching TV content thanks to digital viewing options.  The problem seems to be with “regular” TV, which I assume means the program stream as offered by the network through your TV at specific times.  Survey results show 33% say they watch less traditional TV with streaming options, while 24% say they watch more.  As recently as 2008, GfK’s research showed that streaming options provided a net benefit to regular TV viewing; that year, the differential was +5 points, with 25% saying they watched more regular TV, while 20% said they watched less.

What all of this seems to mean is overall TV viewing isn’t declining.  The question for TV nets is how to derive as much revenue from streaming as traditional viewing. GfK also found 32% are visiting network sites via a mobile device so let’s put that inventory into the mix as well.  Maybe the research is a cry for sellers to do a better job of getting premium CPM’s for these measurable engaged viewers of the streams?  What do you think?

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Filed under digital media, Thinking Aloud

Wiggle Room

Maybe you’ve been playing along with the home version of Instagram‘s TOS controversy.  The interwebs have been buzzing about it for the last couple of days and since I hate to miss a party I’d like to pile on.  However, I have a bit of a different take here, so before you turn away in disgust at my blatant attempt at link bait, please read on.

Via Crunchbase

For those of you who haven’t been paying attention (or who aren’t Instagram users), the basic facts are these.  Instagram, a widely used photo-sharing application, announced it was modifying their Terms Of Service to include this language:

“…you agree that a business or other entity may pay us to display your username, likeness, photos (along with any associated metadata), and/or actions you take, in connection with paid or sponsored content or promotions, without any compensation to you.”

Pretty clear what it means in my mind but I’m not a lawyer.  Actually, since these are for users to read and understand, I shouldn’t have to be.  In any event, many users were distressed that their images could be used without their permission in commercial ventures.  As one might expect, since there are quite a few professional photographers on the service, they were among the most alarmed, and posted that they were deleting their accounts.  So did many users.

The CEO of Instagram stated the following:

“To be clear: it is not our intention to sell your photos. We are working on updated language in the terms to make sure this is clear.”

Intention?  Hmm.  Here is my take on the whole thing.  If you’re not going to do something, say so.  Don’t use careful, lawyer-like language – “not our intention”.  It makes you seem like you’re lying.  If your kid was dressing up on a school night and says “it’s my intention to stay home and do my homework”, you wouldn’t just leave it at that.  We need to be clear and honest with our customers and partners.  Wiggle room isn’t part of that.

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Filed under digital media, Helpful Hints

Running Full Speed In The Dark

If your business does anything in the digital space you probably have some sort of system in place to measure that digital activity.

Image representing Google Analytics as depicte...

Image via CrunchBase

Having run an online commerce site I can tell you that those analytics are second only to actual sales figures in importance.  Having run and consulted on sites where content is king (as opposed to commerce!), the data helps you to understand user preferences, content gaps, and how best to engage the reader.

That’s why something I saw the other day was so disturbing to me.  The folks at DBD Media recently conducted research on Google Analytics implementation across 50 e-commerce websites and found that 80% of retailers don’t know how to use Google Analytics:

  • Only 50% of e-commerce businesses track main conversion
  • 73% of businesses are inflating traffic in their analytics reports,through self referral issues.
  • 60% of GA accounts were not correctly synced with Google AdWords, meaning Pay Per Click data is not being passed-on and is hampering accurate ROI measurements for paid search.
  • 67% of websites haven’t integrated social media tracking
  • 30% of websites have incorrect e-commerce tracking implementation.

There are more findings but for a commerce site these are the most critical ones.  I suspect that if we were to survey content sites we’d find similar issues.  Why does this happen?  According to the folks at eConsultancy:

Our recent Online Measurement and Strategy report finds that the most commonly cited barrier for company respondents was a lack of budget and resources, with 50% of respondents listing this as an issue. Following this was a lack of strategy (31%) and siloed organisation / lack of co-ordination (26%).

For supply-side respondents the most commonly cited barrier was a lack of understanding / don’t know what to measure (47% compared to only 24% for company respondents), followed by a lack of budget and resources (42%) and a lack of strategy (37%).

The first item is particularly galling.  I suspect that has to do less with an actual lack of funds that a failure to reallocate the funding from some legacy activity into analytics support.  What could be more important, especially if your entire business is online?

When you’re doing your next budget, think about what activities add revenue and profit   Maybe those need to be your top priorities as you’re allocating funds? “We did it this way last year” isn’t a system – it’s an impediment.  You with me?

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Filed under Consulting, digital media