TV still on top, for now
Despite the ongoing fragmentation of how people view video, TV remains the strongest brand-building medium available. Scientific research continues to identify this in studies conducted by Core, Ebiquity, Gain Theory, Thinkbox, Peter Field and Les Binet1-3.
Linear TV remains the dominant form of video consumption. In the Republic of Ireland, 79%4 of daily video viewing, among adults, is of linear TV (i.e., watched at the time of transmission or within seven days). Even for younger adults (aged 15-24), linear TV still accounts for 46%4 of the 159 minutes they spend viewing video each day. However, it is important to note that TV will not always retain its unassailable position, as viewing patterns continue to shift and live viewing ebbs. But, for the next five years or so5, TV will continue to be the number one choice for mass-market brand building.
Use the spectrum wisely
In the traditional sense, TV is just one part of a ‘spectrum’ of platforms and formats through which people consume video. In the Republic of Ireland, 8%6 of households no longer have a TV set. Therefore, it is important to consider the full spectrum of video options when planning an advertising campaign.
It is not just the spread of platforms that we must consider; the role of each format, its orientation, environment and ability to hold attention must be reflected in the suite of creative assets developed.
Addressable TV – too early to make a difference
Addressable TV has been available in the Republic of Ireland, through Sky AdSmart, since 2017. Ostensibly, addressable TV advertising seems an attractive proposition, as it can serve different ads to different households watching the same programme. However, its usefulness in this country is limited, especially for national brands, due to low reach and a limited range of targeting options.
Although AdSmart enables advertisers to choose from 13 lifestyle-oriented segments (created by Experian), it only facilitates targeting at a household, rather than at an individual, level. It uses probabilistic matching to form like-minded clusters of households, but it cannot use actual data due to GDPR restrictions.
AdSmart is a useful and growing addition to the marketing mix, but not many advertisers find the target segments scalable enough to justify investment. This will change somewhat when the option to create custom segments using marketers’ own data is available, although Sky has yet to announce a launch date for this option.
Another limiting factor is AdSmart’s reach in Ireland, because it is only currently available on 13 Sky channels. This will change in the future; it is expected that AdSmart will include Virgin Media channels late this year, or early 2020. But, for now, the restricted weekly reach of campaigns is the most obvious drawback of the AdSmart service.
For now, the only clear-cut advantage to using addressable TV is its ability to target regionally. It is possible to ringfence any county and this is very useful for local advertisers and some national brands who need to upweight certain regions or tailor a message to specific areas.
Over the top services are growing
Although advertising is not available on Netflix, the platform is obviously having an impact on traditional advertising-funded broadcasters who continue to experience declining viewing levels.
While we don’t know the exact share of viewing that Netflix achieves, we do know that the subscription video-on-demand (SVOD) sector’s share of all video viewing, among all adults, grew from 7.6% in 2017 to 9.7% in 20184. As you would expect, the impact is more significant for younger audiences, with SVOD now taking 23%4 share of viewing for 15 to 24s. SVOD includes Amazon Prime, NowTV and Netflix, which dominates the category.
This sector of the video industry will continue to grow, particularly as other services such as BritBox and Disney+ emerge over the next year. Facebook also has ambitions to become a major video hub.
Live TV will always feature in people’s viewing repertoire, but its share will decrease over time. National broadcasters need a clear content strategy to compete effectively with this growing global threat. How can a broadcaster like RTÉ, with a budget of €250M7, compete head-to-head with SVOD, which has $50Billion8 to spend on content? The answer is to let the SVOD sector focus on mass-market drama, non-fiction and comedy, leaving RTÉ a clear run to develop programming specifically for Irish audiences. This is a strategy that RTÉ is planning for and understands well.