Commentary

Marketers Caught Between A Rock (TV) And A Hard Place (Digital)

If you think about it, marketers today simply can’t win when making a smart decision about where to place their ad budgets.

TV used to be the steady rock in the marketer’s relationship with advertising: sizeable, trusted and to a degree predictable. But the once-steady rock today has many real and a few perceived flaws chipping away at its role in the media mix. Enough with the rock metaphors; allow me to explain.

Despite the industry’s solid belief in GRPs, TV advertising is historically a medium with thin and crude measurement at its base. I have alluded in earlier posts to the fact that Nielsen measures America’s love affair with “Scandal” or “The Big Bang Theory” through a national sample of a little over 16,000 households. This in turn generates household ratings, the most coveted one being the 18-49 rating.

Take a moment and let this sink in. The value of and the inclusion in the plan is based on a tiny slice of the population. And the most frequently traded target reflects gigantic differences in life stage. What do you think the motivations are for a 20-year-old ordering pizza versus a 45-year-old mom of three?

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And then there is the “where they watch,” “how they watch” and “when they watch” problem. C3 ratings? C-7 ratings? C-30 ratings? The question “what is a rating?” used to focus only on how People Meters actually worked. Now it also relates to when a viewer should be counted.

And if that isn’t enough, marketers have to contend with the ever-increasing cost of buying TV airtime while audiences are flat or slightly declining. This decrease is especially true for younger viewers, who simply don’t think linear TV is all that relevant anymore.

Which brings us to the hard place that holds all forms of digital advertising.

The promise of digital is compelling: Always on! Personal! Infinitely measurable and measured!

In principle, digital advertising should be cheaper on all fronts: cheaper to produce, cheaper to buy (no 18-49 buying targets here!) and cheaper to measure (no People Meters needed!). The reality is that marketers are buying and producing so much digital that, relative to its impact on the marketing mix, it takes up a disproportionate amount of the marketing budget as well as eating up enormous amounts of marketing management time.

To top it off, digital advertising is riddled with fraud. There are some enormous numbers flying around. Kraft says that 80% to 90% of the digital advertising it buys is worthless. Earlier this year, Mercedes Benz in the U.K. pegged the number at 57%. Whichever you believe, both are shocking.

The reality is that digital has become an advertising mess and a marketer’s worst nightmare. The consumer is certainly always on, and able to make the experience highly personal. But for marketers, this has not translated into digital becoming a viable alternative to the diminishing value, impact and position of the rock that once was TV.

I have often said I am not against TV, nor am I against digital. Equally, I am not in favor of TV or digital. I am interested in finding the right path to connect consumers with brands -- and, when appropriate, vice versa. Right place, right time, right message, right context, and so on. But the two options that are, in principle, best placed to do so are both challenged and imperfect.

Now what?

6 comments about "Marketers Caught Between A Rock (TV) And A Hard Place (Digital)".
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  1. Jeff Sherman from OnMilwaukee.com, November 10, 2014 at 12:35 p.m.

    Good post, and - yes - there's a push/pull with the two.

    But, done well and with the right partners digital IS NOT "riddled with fraud."

    Who even watches real time TV anymore? Not me.

    Everything, yes, is challenged and imperfect.

    Go local and trusted to do digital and/or video/"TV" right.

    Happy to help if we can: http://liftdigitalsolutions.com/

  2. Leonard Zachary from T___n__, November 10, 2014 at 12:42 p.m.

    Maarten viewability and metrics from YouTube are worth more than viewability and metrics from a Nielsen poll.

    Maarten you paint digital media with a broad fraud stroke but on the apples to apples comparison above, digital media is the better value and does get the job done.

  3. Rick Miller from Big Chalk, November 10, 2014 at 2:10 p.m.

    Maarten, great post, as usual. I am not deeply concerned with Nielsen's panel size. If built by a trained statistician (which we all assume, because it's Nielsen), those 16,000 households can be projected with a fair degree of accuracy.

    What seems to get lost with TV, as it is measured today, is all the color related to engagement with TV and the ads that support the programming. Sure, Nielsen tells you what has been watched and by which demographics, but you don't learn much about engagement. That's where a panel of 16,000 falls short. The statistics you can project from that panel have to be somewhat binary in nature.

    Social Media has been seen as a piece of that engagement puzzle -- and I know from first-hand experience with social data that it can help. But we're a long way off from marketers trusting it and properly integrating it.

    As for digital fraud, well that's a problem beyond my pay grade!

  4. Tom Cunniff from Tom Cunniff, November 10, 2014 at 4:37 p.m.

    Maarten, what you describe is quite real for brand marketers and is both a major threat and a significant opportunity. The bad news is that TV's long-time ability to single-handedly generate awareness, close the sale, and reinforce good feelings about the brand is -- for most brands -- gone forever. TV can still do the awareness job better than any other medium, but audience sizes have shrunk and attention is now scattered over multiple devices. Digital's ability to reach consumers in the right place at the right time with the right message has long been exaggerated and is still imperfect -- BUT the rise of machine learning means it is now getting radically better much faster than before. IMO the answer to "what now?" is for marketers to re-focus and give real attention to getting their products and services right. Creating me-too products or coasting on reputation were once both surprisingly decent strategies. No more: a brand is only as good as people *say* it is, and the halo effect of one good product among a half dozen mediocre ones is now smaller. The major opportunity today is for the brands who really work to get their products and services right. Challengers can now far more easily leapfrog to the top, and incumbents can now far more easily tumble. What is needed now more than ever in marketing departments is the courage to fight for better products.

  5. John Grono from GAP Research, November 10, 2014 at 6:21 p.m.

    What is wrong with using server-based traffic data to establish the quantum of usage and some degree of profile where possible, alongside panel-based metered usage (at the operating system level rather than just the browser/app level) to establish the heuristics of usage (e.g. repeat usage, duplication etc.)?

  6. Paula Lynn from Who Else Unlimited, November 10, 2014 at 8:21 p.m.

    How about those unscientific experiments of throwing darts at the stock names as a picking device and not doing any better than the experts ? The same procedure may work for picking programs for your ads if you want to talk about wasting money. Enjoy !

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