Bad Economies Are Fertile Ground For New Media Channels
For almost 80 years, every major economic crisis to hit the U.S. has launched a nascent medium to national prominence. The Great Depression provided the catalyst for radio to evolve as a major communications medium in the 1930s. Television took its place as a national medium during the recession of the mid-1950s. Cable television moved from hotel rooms to homes during the energy crisis and subsequent recessions of the late 1970s and early 1980s. The Internet emerged from the military and academic realms into the mainstream during the 1988 recession. After the 2000 recession, online advertising growth exploded.
So what is it about a lousy economy that creates the perfect environment for the adoption of new media? The answer has more to do with human nature than economics, though there is some of that at work too. It is well understood that people are naturally adverse to change. Organizational and behavioral change only happens when the consequences of not changing exceed the risk associated with the change. So it is not surprising that when consumers are buying and profits are rolling in, corporate marketing organizations have no motive to risk market share or a failed campaign by diverting advertising budgets to emerging media. However, when a recession the magnitude of the one we are currently climbing out of hits, it becomes necessary for all organizations to reassess what is working and what is not.
John Wanamaker, founder of the nation's department-store industry, once lamented, "Half my advertising dollars work, I just don't know which half!" That level of ambiguity is no longer an option in today's new economic reality. Every CMO understands that effective and efficient engagement of consumers capable of buying their companies' product has become the top priority.
Consumer media consumption trends and technological changes accompanying the current recession portend a much larger shift in the media landscape this time around. Mobile advertising and digital place-based networks, which display content and advertising on screens in public places, are to this era what cable and radio were to years past. They are aimed at targeting consumers during the 44% of the day that consumers are actually awake and out of their homes (source: PQ Media, actively making purchase decisions.
Until recently, the public mainly consumed media in the home during predicable hours like evening prime time. Today, a significant percentage of the public gets its news, information and advertising while on the go. According to a recent Arbitron Out-of-Home Digital Video Display Study, digital place-based media reaches two-thirds (67%) of U.S. residents aged 18 or older each month. These digital place-based networks turn elevators, lobbies, airport terminals and taxis into efficient and effective communication channels for today's marketers. These networks enable advertisers to target very specific audience segments with engaging content that draws attention to their advertising message.
A poor economy, however, is only one factor setting the stage for the emergence of transformational media. The other critical element that has accompanied the post-recession adoption of new media channels is the availability of third-party audience measurement data. Organizations like the newspaper industry's Audit Bureau of Circulation and broadcast's Nielsen and Arbitron ratings provide objective credibility for circulation and viewership claims.
In digital place-based media, the industry organization OVAB (the Out of Home Video Advertising Bureau) has created guidelines for calculating audience sizes. Over the next several quarters, numerous digital place-based networks will release independent third-party research that will provide advertisers with the equivalent of the broadcast industry commercial ratings, thus setting the stage for widespread adoption of the medium.
Neither digital place-based media nor the recession started the mass media's market share erosion; audiences have been splintering for years into finer and more elusive pieces. In the 1940s, viewers would watch televisions through appliance store windows. When the masses could afford televisions, advertisers followed them into their homes. Today, consumers are on the go and advertisers must engage them out of their homes, on the road, in the air or at the office if they are to prosper in the new economic reality.