Local Messages Open Up The Future Of TV Advertising

Cyril Daoud is the CEO of Hoppr, a global advertising innovator whose technology extends messaging and branding on digital devices.  getty If you want to advertise during the Super Bowl, expect to pay $5.6 million for just thirty seconds of airtime. With an audience of 102 million people around the world […]

Cyril Daoud is the CEO of Hoppr, a global advertising innovator whose technology extends messaging and branding on digital devices. 

If you want to advertise during the Super Bowl, expect to pay $5.6 million for just thirty seconds of airtime. With an audience of 102 million people around the world on Fox and all its platforms, you’d think the bang is worth the bucks. Before 2020, that might well have been the case, but the 2020 Super Bowl was played on February 2 — right before the coronavirus shut down economies around the world.

In the post-Covid-19 dystopian advertising landscape, it’s difficult for brands to justify paying for even basic TV advertising, as sporting events are cancelled or shows can’t be made or are delayed. Major brands, from Pepsico to General Motors, are clawing back up to 50% of third-quarter spending — as much as $1.5 billion.

But while this could be cause for panic, broadcasters are pivoting to an old game to rescue their revenue streams — local advertising. Cheaper and hyper-targeted, local advertising is making a comeback as the TV industry embraces digital marketing techniques long thought to be anathema to the small screen. And as this trend grows, we could see TV advertising become a more democratic space as major brands and local businesses get the opportunity to connect with audiences using smarter, more relevant methods pioneered in the digital realm.

Rise And Fall Of An Airwave Empire

The world’s first official TV advert was broadcast in 1941 in the United States during a baseball game to spruik watches to a tiny audience. TV advertising then accelerated with local businesses and big corporations accessing the airwaves side by side. When local TV stations in the U.S. amalgamated into national networks, advertisers could reach enormous general audiences and local ads fell away.

TV advertising worldwide grew rich with big budget productions like British Airways’ memorable “Face” campaign or Carlton Draught’s “big” ad, pushing the boundaries of what was possible for brands. Yet, the days of big-dollar ads look to be nearing an end, with the global TV industry posting the sharpest falls in ad spending since the 2009 financial crisis and more than half of global advertising sales now migrating online.

The future of advertising is local

TV retains its prestige, but the revenue streams are being siphoned away as digital advertising delivers more and more content to millions of mobile phones, tablets and laptops worldwide. It’s brash, bold and innovative, and in Australia, digital advertising is worth over $8 billion, far outstripping the nation’s TV ad market of just over $2 billion.

It’s popular because the price of entry for digital advertising online is far lower compared to TV, and advertisers have far greater ability to target specific audiences compared to the small screen’s more general appeal. Yet, the small screen is catching up fast. Right across the spectrum of TV services new styles of advertising and audience engagement are emerging that fuse the best online digital practices with the prestige and reach of TV. This technology allows advertisers to serve targeted, interactive adverts to specific audiences segments during the same program — even live broadcasts.

This tech is also unlocking inventory never used before on the screen, even within streaming services. These range from static, clickable display ads on the home screen with a call to action to non-intrusive ads on synopsis screens and even pre-roll ads served remotely between the user clicking the show and the content commencing. These are perfect ad slots to sell to small businesses, especially because they cost far less than a marquee position.

Cheaper By The Dozen

Whereas in the past, an advertising campaign on a traditional TV service would cost tens of thousands of dollars and take many weeks to produce, an addressable campaign can be assembled far more quickly and at a much cheaper clip. There are also services emerging like subscription-based TV advertising packages, drawing small businesses to the small screen that will need ad partners to develop their content.

These kinds of innovations are already drawing market share. In a recent U.S. survey, 91% of 200 agency media buyers for local and regional advertising said they are planning to invest portions of their budgets into addressable solutions, video on demand or over-the-top services.

Advertisers Unlocking The Future Of TV

Although digital advertising is a firmly established market force, there remains a distinct split in the communications sector between those who focus on digital and those who stick to TV.

If the sectors find ways to work together, TV advertising specialists could leverage their expertise to find new ways to market locally on the small screen, while digital specialists will unlock new inventory to deploy their internet-honed skills — because there will always be Super Bowl-level ads with huge budgets.

But locally targeted, interactive and personalized messaging from a wide pool of advertisers with smaller budgets may just be the steady play the industry will need to embrace.

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