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TV Is Still the Competitive Champ
Television is the still the king of the media jungle, but digital media is the obvious new big cat on the prowl. The roars of streaming video services (Netflix, Hulu, Amazon, HBO NOW, etc.) rise in volume, as they compete for wider acceptance and respect. Radio, out-of-home and direct mail, to a certain extent, have been able to maintain their domains. Print media, however, is left with such meager scraps that sustaining its life will continue to prove difficult and cable TV is watching its territory slowly dwindle.
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Collaboration Ensures TV and Digital’s Growth
As the king of the media jungle, TV is aware of the growing power and influence of digital media, but theirs is much more of a collaborative relationship than a competitive battle. Smart advertisers and agencies are using them in tandem, building brand through the enormous reach and frequency of TV and forging engaging, even personal connections with consumers with , social media and mobile. Although digital media’s advertising revenues will surpass TV by 2019, $83.9 billion and $81.0 billion, respectively, online TV revenues will only be $6.8 billion of TV’s total.
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Almost Every Household Has an HD TV
According to Nielsen’s Q Total Audience Report, “high-definition TV” had the highest and most-consistent penetration according to household income, including African American, Latino American and Asian American households. The “high-definition TV” penetration rate was the highest among households with annual incomes of $50,000 or more, which is the prize audience for most advertisers, since they have the most money to spend. Social media use and being “online constantly” also increased with household income levels during They were 56% and 16%, respectively, for households of less than $30,000 and 78% and 28%, respectively for households of more than $75,000.
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Time Trials The use of digital devices – desktop and laptop computer, smartphone or tablet – is both personal and work- or business-related. Some of that time is for non-Internet activities, so digital audiences are not constantly exposed to commercial messages. The time people spend with TV is totally personal, for entertainment purposes. Although many people multitask on mobile devices while watching TV, much of that activity is related to what they are watching, including commercial messages. Total average daily time spent with digital media, including mobile, desktop/laptop and other devices will reach 5 hours, 56 minutes by Time with TV, however, at 3 hours, 58 minutes, will be more than any of these individual devices.
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Drilling Down on Digital Use
The increase in the amount of time people will spend with digital media during 2016 and 2017 will decline significantly compared to 2011 and During 2011, it increased 19.0%, but is only forecast to increase 3.1% during 2017. Time spent with digital media is also fragmented generationally. Young adults (and teens) rule the mobile channel and are spending less and less time on a desktop or laptop, which is where older adults are more likely to access the Internet. By comparison, virtually everyone is watching TV, even teens. It is the central news, entertainment and sports device for the family, and for all ages of family members.
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Streaming Video Services’ Prey Is Cable TV
Although a growing audience is attracted to streaming video services (Amazon, Netflix, Hulu, YouTube, etc.), these services are much more of a threat to cable TV than the traditional broadcast networks and their local affiliates. According to research from cg42, a management consulting firm, “73% of customers of major cable providers believe they are predatory in their practices and take advantage of customers.” It is common for cable cord-cutters to purchase and install an antenna on their TVs, so they can still watch the major broadcast networks and local programming.
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Netflix Conquers the World
The big news in the streaming video services industry during mid-January 2016 was that Netflix had 74.8 million subscribers worldwide as of the end of December The service was made available to 130 countries during early January. In the United States, Netflix’s biggest market, there were 1.56 million new subscribers during Q4 2015; however, the target was 1.65 million, and 1.9 million were added during Q The total number of US users of over-the-top video services will increase from million during 2016 to million by 2019, a 6.8% increase.
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The Fragmentation of Radio
Radio reached 90.8% of all persons, 12+ each week during December Radio’s reach number has been eroding slightly since December 2014, when it was 91.3%. Much of the teen and young adult audiences have migrated to online radio services. According to Edison Research, the monthly online radio audience reached 143 million during January/February 2015 and 77% of that audience was 12–24. Edison also discovered that the Internet has surpassed radio as the first place people visit to learn about new music. During 2010, it was 39% for radio and 31% for the Internet. For 2015, the Internet was 44% and radio 32%.
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Out-of-Home Media’s Exclusive Territory
Total Q revenues for out-of-home (OOH) media increased 4.3% (compared to Q3 2014), or a total of $1.71 billion. Revenues also increased significantly during Q1 and Q2 2015, at 4.7% and 3.3%, respectively, compared to 1.0% and 0.8%, respectively, for the same quarters of 2014. Heavy TV advertisers, such as McDonalds, Apple, Verizon and Coca-Cola, were among the top 10 Q advertisers, but OOH media doesn’t compete with TV since consumers’ interaction with these media occur in totally exclusive settings.
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Justifying the Cost of Direct Mail
Currently, direct mail is able to deliver an acquisition cost and ROI that are competitive with other direct marketing channels, according to the Direct Mail Association’s latest Response Rate Report. For example, $19 and $15–$17, respectively, for direct mail; $11–$15 and $21–$23, respectively, for ; $16–$18 and $15–$17, respectively, for social media; and $16–$18 and $12–$14, respectively, for mobile. Why pay the enormous costs of direct mail, however, when simply posting content to social media and mobile, for example, could deliver essentially the same ROI? Digital media is much more of a threat to direct mail than television.
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Chasing Print from the Jungle
The latest data from the Newspaper Association of America reveals that there were 1,331 daily newspapers (morning and evening) during 2014, compared to 1,427 during Total circulation for morning and evening editions has decreased from million during 2011 to million during Sunday circulation decreased from million to million for the same period. Although the total US magazine audience increased 10% from the first half of 2014 to the first half of 2015, or 1.66 billion, print and digital versions’ share decreased 12.1% while the audience share on the mobile Web increased 50%.
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Guiding Your Clients Through the Media Jungle
Despite very slight erosion in TV viewing time and the increasing strength of digital media, the TV set is the still the individual and the family’s primary device for viewing news, sports and entertainment. The challenge for today’s advertisers, especially local retailers, is to learn how to use the complementary nature of TV and digital media in an efficient and effective manner. This combination is the future of media advertising and the sooner your clients embrace that future the better competitive position they will have in the marketplace.
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