Tag Archives: media & advertising

A New Dark Age?

Are you watching less TV than you used to? If the answer to that is “yes” then you’re not alone. Oh sure, you’re probably spending a lot more time in front of a screen, but when I ask that question I’m asking about cable network programming delivered live or watched via DVR within 3 days. That measurement, by the way, is known in the business as C3 ratings and there is not a lot of good news. Michael Nathanson, a senior analyst with MoffettNathanson LLC issued an analysis of recent data and this lede from the International Business Times sums it up nicely:

The biggest American horror story on cable last year, didn’t come from FX — it came from Nielsen. Ratings across national cable television networks tumbled 9 percent in 2014, triple the decline seen in 2013 and more than quadruple the 2 percent decline seen in 2012. To call it a crisis would be an understatement. If the trend continues, TV could be heading for a new dark ages.

Why the dark ages analogy?  You’re seeing it in the news.  Cable operators pay these networks a lot of money each month (OK, you’re right – WE pay…) but if no one is watching maybe losing those networks from their systems isn’t a big deal.  That sort of explains the stories you read about networks going dark on some systems (as I’m writing this Verizon just turned off the Weather Channel and Dish turned off Fox News for a few weeks)over what those fees might be.  Without a hue and cry from consumers who appear to be moving on to alternatives, the networks have no leverage.

While some in the industry are complaining yet again about faulty measurement methods, the reality is that people are shifting their viewing habits away from live, linear programing.  Even sports, which is supposed to be immune to this, suffered a 5% decline. You’re probably aware that HBO, NBC and CBS are launching their own streaming services. That sort of move might hasten the demise of business model that has fed TV networks with licensing fees as the cable and satellite distributors focus more on their broadband ISP businesses and less on TV.  After all, if they can distribute the programming services for free via their internet side, why pay?

Hopefully this is good news for those of us who pay for this stuff.  What do you think?

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The Early Warning System Is Going Off

There’s always a scene in movies about some epic disaster during which an early warning system goes off.  A young scientist believes a comet will hit the Earth but the older scientists tell him he’s nuts.  A tsunami monitor goes off when there are calm seas and the woman watching it disregards the information.  You know the drill.  As the audience, we know that disaster is coming but those who have the information are blissfully unaware until disaster strikes.millennials-broadcast

I thought of that as I read a couple of articles the other day.  The first is from the good folks at Poynter who reported on some research the NY Times did.  Quite an eye-catching headline:

Thirty-four percent of millennials surveyed watch mostly online video or no broadcast television, new research from The New York Times says.

Now granted, the study was among 4,000 current users of online video so one could argue, like the woman watching the calm sea, that the sample is skewed.  The again, given the high percentage of young folks that are online video watchers, I’d listen.  After all, cord cutting is no longer dismissed as the rantings of some early adopter lunatics.  There are numbers that prove it’s for real, especially since we’re not talking about “cord-nevers” – young people who never had cable TV – just a broadband connection for streaming.  As one report had it:

While 3.2 million new U.S. households were set up in the last three years, the paid-TV industry only added 250,000 subscriptions in that same period.

Not so good.  And if that’s not a loud enough alarm, here comes the near-miss fireball from out of the sky that gets everyone’s attention, courtesy of our neighbors in the Great White North:

The Canadian government will soon require cable and satellite television providers to make it easier for customers to buy only the channels they want rather than pay for bundles, the country’s industry minister said on Sunday.

“We don’t think it’s right for Canadians to have to pay for bundled television channels that they don’t watch. We want to unbundle television channels and allow Canadians to pick and pay the specific television channels that they want”

Sound familiar?  It should, since it’s the same fight that’s been brewing here for several years and which intensifies each time your cable or satellite bill goes up.  Cable executive are rightly scared that their penetration into the household base will fall, making subscriber revenues drop and ad sales impossible.

Young people tuning out in droves.  The fundamental business model under attack.  Have we reached the end of the TV world?  Not yet.  But in my mind the early warning systems are howling.  What do you think?

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Horns

Business took me away for a hotel stay last evening. As you might know, Rancho Deluxe, better known as the home office, is located in a pretty quiet suburban town. Some random deer sneezing is about as loud as it gets in terms of external noise.  Living in a city is different and last night’s stay reminded me of when we lived in Manhattan. It’s rarely quiet.

Car horn symbol

(Photo credit: net_efekt)

The sound that seems to dominate is that of horns. Car horns, truck horns, construction horns. All day and most of the night, their incessant sound can drive you nuts until you learn to ignore it. Which is, of course, the business point.

Too many brands use their marketing messages much as a driver uses a horn. Think about how you use your car’s horn.  There are the friendly little taps to let someone know you’re there and to come out to the car.  There are the intense, lean-on-that-sucker blasts to tell the moron texting that the light has changed and to get moving.   Despite its simplicity, the horn can send a lot of different messages, all of which are intrusive and attention-getting.

Marketing is like that too.  Some brands are still treating their audiences like the line of traffic in front of them.  They blast away even when it’s obvious that the horn will do no good.  How do you react when a driver does that to you?  I don’t react well.  Than again, you learn to ignore it.

Consumers have learned to ignore car horn marketing.  The harder you slam away, the less chance you have to get them to pay attention.  Using car horn tactics in channels such as social media can do way more harm than just the apathy caused by ignoring your messages.  Your inept marketing can be held up for ridicule, much like the dope that’s too busy reading his email to drive.

Horns can be lifesavers – alerting another driver you’re behind them as they back up or making sure a pedestrian is aware you’re coming, for example.  If they’re abused, however, they’re just so much noise and serve no purpose.  We need to make sure that our marketing doesn’t fall into that trap.

You with me?

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The Natives Are Restless

Today we hit once again on the “everything old is new again” theme that we touch upon from time to time. One of the best media analysts in the business is my friend Dan Salmon at BMO Capital Markets. He released a report on a “Native Advertising Summit” he attended. It made me smile and I’d like to share why that was.

First, what the heck is native advertising?  Way back in the olden days of the web, we used things such as  banners, boxes, buttons.  This ad units sat on the web page hoping a user would notice them.  Others, such as pop-ups, interrupted users’ content experiences.  These units are still the purview of all of the programmatic buying found via ad networks and other RTB platforms.

So-called native advertising is way more integrated.  Sponsored Stories, promoted Tweets,  and sponsored videos are just a few of the  formats sprouting up across the web, giving brands a channel to connect directly with consumers through content and publishers a new opportunity for revenue.  As Dan wrote in his report:

It is increasingly clear that the native trend is becoming a pressure point for publishers pushing back on recent digital ad innovation that has mostly centered on real-time bidding, programmatic ad buying, and improved yield for buyers much more than sellers. At the same time, these publishers are finding a willing and hugely important constituency on the buy side, but one that is traditionally under-represented in digital marketing: branding-oriented advertising budgets.

In other words, publishers are sick of the dive to the bottom CPM‘s are taking and so we’re going to use something very old:  sponsor integration into content.  It’s Your Lucky Strike Theater all over again!  I’m sure there will be all sorts of technologies sprouting up to make this happen in a more efficient way, but the activity is the same.  Sponsors are trying to gain both visibility as well as shared brand equity with the content they’re sponsoring.  You see this in sports all the time (and it dates back to The Gillette Cavalcade Of Sports in the late 1940’s).

To touch on my favorite theme – the tools change but the basic business doesn’t.  We can call it native advertising or we can call it sponsorship   I call it smart, even if it isn’t really new.  How about you?

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Influence and Spending

I always look at research with an eye toward the axe the researcher is grinding. The fact that a survey is conducted to prove a point doesn’t necessarily negate the value of the findings but it does mean we have to be careful about how questions were asked. That said, I took a look at a study released by the folks at Technorati Media called the Digital Influence Report.  It takes a look at the role “influencers” have on purchase decisions and how brands are spending to reach the influencers.  I guess the thinking is that if these folks like your product they’ll drive their friends and followers to make a purchase.
Technorati‘s axe to grind is that they sell ads on blogs.  They’ve put together target segments of bloggers.  Not surprisingly, one characteristic of the aforementioned “influencers” is “Influencers are most active on blogs, as 86 percent say they have them and 88 percent of those say they blog for themselves.”   However, even with an axe to grind, the point is a good one.

For as long as I’ve been in media (since the late 1970’s, thank you) someone is trying to make the point that the audience/spending equation is out of whack.  The argument is always “we’ve got X% of the audience and yet we’re only getting Y% of the budget and we should be getting a lot more.”  There’s truth in that although it does ignore a few key factors:  environment, cost/value ratios, and others.  In this case, the food chain look like this:  spending against social media is about 10% of the digital spend, and spending against influencers is roughly 6% of social.  In other words, it’s tiny, especially compared to the influence these people have against purchase decisions.  As you can see on the chart I’ve embedded, 32% of consumers identify a blog as a source most likely to influence a purchase decision.

We can debate the merits of this particular study but I think the point is a good one.  There is too much of a herd mentality when it comes to advertising and that appears to be the case in social advertising as well. Blogs have as much influence as Facebook but Facebook gets more than half of all spending against social.  In part that’s due to its ubiquity.  In part that’s due to the “safety” factor – you don’t get fired for buying a market leader and it’s a much easier sell when the higher-ups have actually heard of the medium you’re buying

I take all research with a grain of salt.  That doesn’t mean I don’t believe it but we should always try to get beyond the intent (or bias!) of the researcher and into the good stuff that might be hidden inside through our own evaluation.  What do you think?

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What’s On Your TV Might Not Be TV

Some information I think is significant came out a couple of weeks ago and I made myself a note to share it.

English: A child watching TV.

(Photo credit: Wikipedia)

Sorry for the delay!  It has to do with yet another tipping point being reached and this one has to do with how we use the “cool fire” that’s the focal point of a room in many homes – the TV.  The folks at NPD Group put out a release that summarized the study:

According to The NPD Group,… over the past year, the number of consumers reporting that the TV is their primary screen for viewing paid and free video streamed from the Web has risen from 33 percent to 45 percent. During the same period, consumers who used a PC as the primary screen for viewing over-the-top (OTT) streamed-video content declined from 48 percent to 31 percent. This shift not only reflects a strong consumer preference for watching TV and movies on big screen TVs, but also coincides with the rapid adoption of Internet-connectible TVs.

In other words, people figured out how to shift the viewing for the desktop to the TV.  Why is this significant?  In my mind, it make Netflix a cable channel in consumers’ minds and not a streaming service.  That’s an example.  Of those viewing online video on the TV, 40 percent use their connected TVs to stream video via Netflix, 12 percent access HuluPlus, and 4 percent connect to Vudu.

Another reason it’s significant is pretty obvious – when the TV is being used to stream web content it’s not being used to watch “traditional” TV, at least not in “live” mode.  Of course, there is a ton of time-shifting going on and it’s a lot of what we think of as “TV” that’s being shifted and watched.  Still, one wonders how this affects what used to be the fundamental underpinning of the business: the ability to deliver ad impressions to marketers.

Unless you’re a live-sports addict (ahem…), cord cutting is rapidly becoming an option for a lot of people   While this might be another nail in the coffin of the traditional PC (hello tablets), I think it’s also something to which TV service providers need pay attention (which I know they are).  The TV is a screen, just like the PC, the tablet, or the mobile device.  It’s becoming just as content-provider agnostic as are those devices.

Do you watch web video on your TV?  How?  Apple TV?  XBox?  Own a web-enabled TV?  Have you cut the cord?  What’s that like?

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Missing My Wallet

Birthday Cake

Image by Пероша via Flickr

I had a birthday recently and am now firmly ensconced in the 55+ demographic. I know that this doesn’t matter to any of you since my youthful spirit shines brightly. However, it seems to matter a lot to people doing research or trying to sell stuff. What a shame.
This really hit home to me as I was being screened for yet another online survey. I take these for a couple of online music services in order to get the service for free. However, although I live in a nice zip code and am an active consumer (with opinions about everything as you all well know), I screen out of a lot of surveys – my opinions aren’t needed –  and I’m pretty sure it’s the age screen that determines that. Huge mistake, and here’s why. Continue reading

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