Happy TV Executives Seek Halfway Digital Advertising Goal Line
A happy 50-50 advertising scenario is the near-term goal of what some old-line media-centric companies are seeking. Wired magazine, for example, says over 50% (59% to be exact) of all its ad dollars now come from digital efforts.
Magazines would love to get to this level, as many troubling books are posting much smaller digital shares against their old-fashioned print revenues. Can one call the 50% digital advertising mark a financial success? It would be so for any magazine (or other media company) whose share of digital ad dollars would more than make up for any loses incurred in their traditional advertising formats.
But what does this benchmark mean for TV networks and studios?
For those media, it comes down to where premium video -- that is, big time TV shows – lands. In theory, premium video gets more in advertising (pre-roll) on a cost-for-whatever basis than any other digital advertising, including the messaging that surrounds print-like digital content.
By way of rough comparison, total broadcast networks’ TV advertising dollars come to around $12 billion a year -- with another $12 billion for cable TV networks. All this comes against some $2.7 billion in total digital video advertising. Premium video advertising holds the greatest share here.
We don't know exactly what each network gets in digital video advertising sales. Hulu -- a major provider of premium video for three of the four major broadcast networks -- pulled in $695 million in 2012, with around $500 million of that coming from ad sales.
Surely that doesn't come close to any 50% benchmark of traditional TV national ad dollars. But if growth trends continue as they are, you could imagine networks' blue-sky projections might get them there -- someday.
Right now TV doesn't have the ad sales woes of magazines and newspapers, as TV continues to find growth trends and positive stories to tell marketers about traditional TV media. Still, that tradition could still weigh on TV -- just like print -- someday.
Howard Mittman, VP and publisher at Wired, told Ad Age: "Hitting 50% is proof that there is a successful template inside of this industry that can be followed by others and that having a magazine doesn't necessarily need to be an analog anchor around your technological neck."
All to say, media's future still looks to be a pain in the neck.