If TV Is So Dead, Why Are Online Companies Its Biggest Backers?

Has anyone else been wondering when television would fall over and finally quit this mortal coil? It has been predicted for years, hasn't it? There hasn't been a conference gone by where someone wasn't telling middle-aged dinosaurs that social and digital were the way to go and television had had its day -- too old, too analogue, too time-intensive and way too expensive.

Well, guess what? It turns out that television grew last year in the UK, and guess who the main supporters were? That's right -- the online giants. The businesses that are truly digital, that have no stores to support and so you would imagine would be pumping nearly all of their budget into digital are actually -- and for the first time -- the biggest backers of television. Together, online businesses invested 8% more in 2016 than the year before, taking total spend up to GBP639m, according to figures from Nielsen. 

Their rise to the the top of the league of tv spenders was helped by food attributing 10% less budget to the channel last year, as well as beauty and cosmetics dropping 3% of spend. In the fourth spot was entertainment and in fifth place was automotive -- the only other top five category to have increased spend (by 3%) during 2016.

Now, if you want to write off television for some other reason, such as share of market, then there is a stat for you in AA/Warc figures. They reveal that the channel is down from 26% of UK ad spending in 2015 to 25% in 2016. It's probably a good time to point out that in a growing market, that's a quarter of a much bigger pot. At just over GBP5bn last year, tv in the UK grew by a fraction of a percentage point -- but again, let's not forget that even standing still, as a proportion of a growing market, means it is actually growing. eMarketer predicts this proportion of overall spend for tv will decrease marginally over the next couple of years, but to labour the point, it's a reduced proportion of a growing market. 

I see two driving forces behind television's continued rude health. I have been talking with guys from some of the big agencies and they're all pretty much saying the same thing. The people behind these online brands want to get the word out to as many people as once as they possibly can on a tried and tested channel. For a quick rise of brand awareness, it's hard to beat tv. Perhaps more to the point, as one pal confessed, the margin on selling a brand sponsorship of a show is much larger than selling a bunch of media, and it's pretty simple too with so many channels and so many shows now calling out to be "brought to you by company x."

Digital display is the other surefire way to build up awareness, but it is beset by problems. A report todays suggests that more than a quarter of programmatic ads do not meet the IAB's quality standards. Plus, we also learned from the IAB this week that 22% of the UK public are blocking the ads anyway, and when you factor in ads being unviewable to a human (so we're including fraud here too), estimates can vary from a fifth to one in two ads not hitting the mark. Then there are the murky waters of brand safety that have recently been highlighted by an investigation by The Times -- let's not also forget that Facebook stands accused of some very dodgy video metrics. 

With all this to bear in mind, is it any wonder that there is life in tv yet? Is there any better proof that its biggest supporters are online-only companies? 

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