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Finding the Way Forward: Brands on TV

November 28th, 2016   ||    by Charlene Weisler   ||    No Comments

Has the bloom faded on digital advertising? There are more brands on TV, showing increased TV ad spending over previous years. According to AdAge, Chipotle is running TV ads for the first time since 2012 in select local markets. The company has been increasing its promotional and marketing spending in the face of declining sales, with second-quarter spending at 4.3 percent of sales in 2016, up from 2.3 percent a year earlier. The recent presidential election is also a testament to the power of television. According to TheStreet, TV political ad spending in 2016 has broken all previous records. And BIA/Kelsey has been forecasting a general return to TV for ad spend.

But in a digitally hyped media atmosphere, one might still be tempted to ask: Why advertise brands on TV? The answer is simple: Among those working in the television marketplace, there’s arguably no stronger media platform for brands in terms of reach, accountability, measurability, and engagement than television.

The Agency View

From the agency perspective, “Advertisers are expressing an increased interest in utilizing TV nationally, regionally, and on a local-market basis. This may be coming at the expense of other media such as print, OOH [out-of-home advertising], as well as digital,” stated Russell Zingale, president USIM, Eastern Region. “Driving this interest is the increased availability of consumer-focused data through the buying platforms of addressable and programmatic TV. TV will continue to work hand-in-hand with digital, one not replacing the other. Through innovation (providing efficiencies) and data-focused metrics, television is strongly positioning itself for future growth,” he added.

Helen Katz, the SVP director of global analytics and insight practice for Publicis Media, explained the company’s work with clients “has given us the confirmation that many advertisers already believed, that ‘television works’. We proved this through the many (50+) closed-loop experimental-design research studies. In comparing the response of targeted households known to have been exposed to our advertisers’ addressable ads to matched homes that were not exposed, we have shown, each time, the power of TV to elicit sales, or attitudinal shifts, or retail visits with granularity.”

The Network View

TV’s appeal was also noted by Howard Shimmel, chief research officer for Turner who said, “We saw advertising dollars come back to TV for several reasons, notably greater intelligence around TV ad effectiveness; industry issues faced recently by digital brands, including viewability; and powerful capabilities like audience targeting, once only available on digital, coming to television.”

According to Adweek, Turner and Horizon Media recently partnered on a study with MarketShare that analyzed thousands of marketing optimizations used by major advertisers from 2009 to 2014. The result showed TV advertising effectiveness remained steady during that period, outperforming digital and offline channels in metrics like sales and new accounts. Turner also conducted a joint analysis with TRA and A&E which showed that for every dollar CPG manufacturers cut from TV, they lost $3 in product sales.

The Brand View

For brands, TV still commands the greatest amount of viewer time and attention and continues to provide efficiency and measurable reach. “TV as a traditional medium is still important,” said Rich Lehrfeld, senior VP global brand marketing and communications, American Express, in AdvertisingAge. “When we run a heavy TV schedule, we see a lift in sales and product awareness. We need to run two weeks of digital to get the reach of one day of broadcast.”

The predictions that TV would be eclipsed by digital haven’t proven very accurate. TV’s ability to reach and engage—while offering granular, standardized measurement—places it in a stronger competitive position than ever. The future will be televised.

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