Wieser: TV Will Continue To Dwarf Other Media
TV is not likely to be dethroned in the next few years either--as it will continue to dwarf other media, including online video, in popularity, said Brian Wieser, director of industry analysis for Interpublic unit Magna Global.
"TV is not dead and it's not dying," Wieser told audience members at the OMMA Publish program on Tuesday, pointing to the 30 hours per person per week that people still spend in front of the tube. The convenience, relatively low cost and quality of content are among the reasons why traditional viewing will remain dominant.
TV ad spending also continues to grow, although at a slower rate than online or other digital media. And because it can deliver on the traditional industry measures of reach and frequency, TV still claims the lion's share of ad budgets. Last year, an estimated $60 billion was spent on TV advertising, compared to only $366 million for online video.
Wieser also attacked a widely held view in Internet circles that marketers' share of Web spending should equate with the amount of time that consumers spend online. A common estimate is that the Internet gets roughly 7% of ad dollars, while accounting for 15% to 20% of people's time.
"By that logic, there should be no money in search," Wieser argued, because people don't spend that much time per session on search compared to other online activities. But search has turned out to be a highly efficient ad medium. Based on average ad dollars spent per hour of consumption, it comes in at $9 compared to only 10 cents for TV.
The difference is that the growth of online advertising has been driven by small and medium-sized businesses using direct marketing vehicles--principally search--to drive sales rather than the big branding dollars that TV attracts. In other words, one could argue that the Internet is a victim of its own success as an efficient ad medium.
When it comes to emerging media--including online video and advanced TV technologies, mobile content, social-networking sites and online gaming--spending has been mostly experimental so far, according to Wieser. Those categories attracted only about one-third of the estimated $9 billion spent on search advertising last year.
Much of the spending on emerging media is also coming from smaller advertisers and e-commerce marketers who are "endemic" to the Internet, such as Amazon and eBay, rather than traditional brands.
So what will encourage more spending on emerging media? Wieser outlined various factors, including more widely standardized systems for ad buying and improved ability by agencies to analyze and apply user data. "There's all of this data out there, but the industry is relatively poor at using it," he said.
Instead, new media buys today often come down to "gut feel," Wieser added. "It's unfortunate, but a reality that advertisers won't pay to study, won't pay to experiment."
The greater complexity and unfamiliarity of emerging media buys compared to TV also acts as a barrier to more involvement. "Most of this stuff is so incredibly labor-intensive it becomes a deterrent to using it unless somebody's willing to pay for it," Wieser said.