elevision is still the largest adver-
Ttising medium worldwide and it has withstood the challenge of the Internet remarkably well. Ad spend remains firmly focused on linear TV advertising, and high-quality content is more valuable than ever as advertisers seek to squeeze more bang out of hit shows. “The days of monolithic television are long gone,” says William Cabrera, the executive VP of global research and modeling at Havas Media, which is active in more than 120 countries. “What we now have is television that is very much about convergence and content on
the Internet becomes stronger. In the emerging markets, such as India, Indonesia, China and Brazil, broadcast media is growing. Even print is growing.The emerging middle class in these markets is consuming the traditional media mix. The third speed is in the less developed markets, accounting for about one-third of the world, where there is not much change taking place in a fairly static media landscape. Perhaps mobile telephony will be a bigger factor in these markets.” Despite the swing to online in developed markets, things are looking up for TV, according to Irwin Gotlieb,
the set-top box actually switches to the DVR to run the commercial and then switches back to the linear stream. How the advertiser or the agency knows which ads the viewer wants to view depends on a huge amount of data that is available at the household level, without any identifiable personal information. But don’t throw out the ratings yet. “Having set-top-box data is wonderful, but the set-top box doesn’t tell me if it’s the lady of the house or the man of the house or the child who is watching,” Gotlieb admits. “So we will always have television panel data and we
holds, rising to 50 percent in the 18-to-49 demo and 66 percent among 18-to-49s who own tablets. In the U.S., live TV viewing fell from 89 percent to 85 percent from 2006 to 2011, according to a study by Nielsen. In the U.K., 90 percent of TV was viewed live in the first six months of 2012, according to the British commercial TV marketing body Thinkbox.The number of ads watched at normal speed actually rose 1.6 percent year on year to a record high of 491 billion spots. However, in the 51 percent of homes with DVRs in the U.K., time-shifted viewing accounted for
Buying TIME By Jay Stuart
Television advertising is evolving to meet the challenges of new devices and viewing habits. demand. And it will increasingly involve different devices, with consumers making their own schedules and choosing their own formats. But it is still television. It is audiovisual, it is engaging and it occupies a big chunk of people’s free time and dominates their media consumption.” According to the advertising giant GroupM, TV accounted for 43 percent of measured global media investment in 2011, a record high. However, GroupM warned that the figure might be a peak before a downward trend, with continued development of Internet advertising—notably online video—nipping at TV’s share. “We are seeing three speeds of advertising growth,” says Cabrera. “In Europe, North America and Japan, normal broadcast television will plateau in the next two or three years as
the chairman of GroupM. “With advanced advertising technology beginning to appear on the horizon, television will be able to go toe to toe with anything out there,” he says. ADDRESSING THE AUDIENCE
GroupM has been running addressable ads—commercials targeted to a specific device or consumer—in the U.S. since last October on 7 million DISH Network set-top boxes. DIRECTV and Verizon FiOS are also addressability-enabled, and other major players such as Cablevision are on the way. GroupM has measurement capability for about 20 million addressable set-top boxes, and that number is going to grow very rapidly over the course of the next three years. The ads are pre-loaded into individual DVRs, usually the night before they are shown. There is a keytone for the addressable ad and 10/12
will have to learn how to fuse the two into something that informs our strategies and our tactics.” According to Deloitte, advanced advertising, including targeted addressable and interactive advertising, will face a number of challenges to becoming mainstream. One is winning the acceptance of consumers and regulators. Another is establishing a clear competitive advantage over traditional TV advertising and existing forms of targeting and segmentation. THE DISRUPTORS
The advantage over traditional advertising might become easier to demonstrate as the disruptive impact of the DVR, which enables viewers to skip commercials in recorded shows, continues to increase. Research from Npower in April of this year showed DVR penetration at 44 percent of U.S. house-
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15.9 percent of total viewing in the first half of this year, up from 14.7 percent in the same period of 2011. As DVR penetration grows, live viewing will inevitably decline. The big new innovation in the market, the most dangerous to date for ad-supported TV, is automatic skipping of ads. In May, DISH Network rolled out Auto Hop, a subscription DVR feature that zips over ads automatically in recorded shows. FOX, NBC and CBS have all filed suits against the move. The reality of the DVR is a daunting one in today’s broadcast market. “Our business is selling 30-second and 15-second spots day in and day out,” says Mitch Burg, the president of the Syndicated Network Television Association (SNTA), a nonprofit body whose members are DisneyABC Domestic Television, CBS Television Distribution,Warner Bros. Brand Networks, NBCUniversal