ANA: Social Media, Web Spend Up, TV Down
A new Forrester Research/Association of National Advertisers survey says TV marketers plan to spend 41% of their media budgets on television in 2010 -- the same level as a year ago. Still, this was down from the 58% level of two years ago. The survey says this illustrates a continued lack of confidence in the effectiveness of television ads.
The survey looked at 104 U.S. advertisers in 21 industries, representing nearly $14 billion in measured media budgets. It included companies such as Cisco Systems, GlaxoSmithKline, ING, Kraft, Marriott, State Farm and Clorox.
Some 62% percent of companies say TV ads have become less effective in the past two years due to increased advertising clutter. Worse still, virtually all advertisers believe the TV industry needs new audience metrics beyond reach and frequency; 82% of respondents would be interested in ratings for individual commercials.
But one sign that has turned around for TV marketers: The expectant lifespan of the 30-second commercial. Now, 19% say the 30-second spot will be dead in 10 years. This is down from 28% a year ago.
The future of addressable advertising is showing some mixed signals. While 78% are interested in targeting consumers more precisely, only 59% would be willing to pay a premium for it.
Future branded entertainment deals will grow, according to 80% of advertisers. And in 2010, 38% say they will spend more on branded entertainment as an alternative to the 30-second commercial.
Social media, Web advertising and search are stealing budgets from TV and other media. Of those surveyed, 77% said they would be moving TV dollars to social media this year; 73% plan to shift money to online advertising, and 59% will be spending more on search-engine marketing and 46% on e-mail marketing.
Other non-TV traditional media doesn't seem to be part of this trend. Only 15% said they plan to increase spending in traditional media such as radio, outdoor, magazines or newspapers.
"CMOs need to prepare for television's digital future by forcing change upon the TV advertising ecosystem," said David Cooperstein, vice president and research director of Forrester Research.
"We recommend that advertisers get ready for the future of television by preparing to deliver targeted commercials, delivering true branded entertainment experiences and embracing the connected TV."
The survey findings will be presented at the ANA's "TV and Everything Video Forum" on Feb. 11 in New York.
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"The survey says this illustrates a continued lack of confidence in the effectiveness of television ads." It's the shotgun vs. the sniper rifle. Killing is easier when you know exactly who is in your sights. Men 18-34 is a pretty wide target...
So the good news for television is that only 19% of those surveyed think the 30-second spot will be dead in 10 years...compared to 28% a year ago? Ouch.
But what if the way marketers used TV advertising were to change...dramatically? What if it became part of a true conversation-centric marketing strategy? What if it played to the strengths of social networking?
I don't have any reason to favor one medium over the other -- and that's not my point. But perhaps the problem with TV advertising today – and all other advertising for that matter – is that it ignores the emergence of the empowered consumer in an internet everywhere world.
At Media Logic, we're recently published a whitepaper entitled "Conversation-Centric Marketing: Making Sense of the New Social Order." It offers a new model for marketing and puts all media - paid, earned and owned - in a new context. I invite you to check it out and share your thoughts. Whitepaper and video are at www.mlinc.com. Comments are welcome on our blog, www.logicaljuice.com.
This is why I don't understand Vizio's superbowl commercial (http://tinyurl.com/y9nudtx). If we're migrating to smaller wifi devices, why would we want to surf on our HDTV's?
Lets see. TV's reach is shrinking, Audiences of TV are becoming more and more diluted over more and more niche channels, The percent of media consumption via TV is sinking, and The traditional 30 sec spot is losing favor. Of course TV's slice of the media pie is shrinking. Like it or not, TV ads have all too often not been held to the proper standards of measurement and effectivness.
The decisions and budgets on TV ad spends have been just as emotionally based as they have been rational. Newspapers were the first to work to transform their relationship with consumers and advertisers, now it is time for TV and Radio to do their part. This will be a positive for the industry in the long run. Excited to see how it transforms. In the meantime, online spends will continue to gain momentum.
I agree with David Cooperstein's recommendation to the advertising community. There is a tremendous amount of work being done by all TV advertising platform constituents to provide advertisers with reach, measurement and ROI for their TV ad spends - not just for traditional linear TV but for many new types of ad units being created as a result of the technological advancement TV advertising is undergoing. Sigma Systems for example is one such constituent; we've built an audience qualification solution that enables household addressability on all TV viewing platforms (see www.sigma-systems.com, solutions, advanced advertising). I encourage advertisers to engage and participate in this transformation and take advantage of the new TV advertising opportunities it offers.