question of the week
Are brands really falling out of love with TV? And if so, how are agencies adapting?
We ask whether TV really is falling out of favour with marketers - as Kantar claims - and if so what implications this has
20 September 2023
'The death of TV' has been falsely proclaimed so many times that it's almost staggering that anyone thinks it a mantra worth repeating. Except that this time the research behind the headline-grab was from Kantar and it explored the role of TV advertising in the modern marketing mix.
According to Kantar's latest Media Matters report, TV has plummeted from third on the list of preferred media channels for marketers in 2022 to 12th. The survey of 900 global senior marketers and 16,000 consumers added that while TV remains the most trusted ad channel, only a net 6 per cent of marketers say they will upwardly revise TV spend in 2024.
The news prompted a stern rebuttal from Lindsay Clay, the chief executive of Thinkbox, who pointed out that the decline in viewing of linear TV is well documented but that any definition of TV should include on-demand viewing, where reach is growing.
Either way, it's always interesting to see this debate resurface again - and check out the basis upon what the hypothesis is built. And if TV is really falling from favour among marketers, what does this mean for the business model of agencies, whose talent and commission-based funding has traditionally been heavily dependent on the attractive - and effective - nature of TV advertising for so long?
Simon Davis, chief executive officer, Walk-In Media
My short answer would be that Kantar’s methodology is so flawed, especially in the archaic separation of the different flavours of TV, that it reinforces the value of having grown-ups in media agencies who are paid to question things on behalf of clients.
However it does shine a light on the main challenge facing marketeers – so many channels, and so little budget. Now more than ever, the core function of the media agency becomes one of effective integration – producing plans which generate the optimal commercial outcomes from the spectrum of channels available, including all the platforms now delivering TV; and then accurately measuring those outcomes cross-platform.
Unfortunately, the prevailing network media agency model in which specialisms like investment, performance, social, data, tech etc are made separate through centralisation, is making this objective harder to achieve for marketeers. Experienced generalists who can pull it all together for clients are being squeezed out of holding companies, making them more profitable for shareholders…but less effective for marketeers.
Justin Pahl, Co-CEO, VMLY&R
Of course agency models need to change! Customers' lives are changing: where they spend their time, what they are doing, and what they need from brands. Linear TV may be falling away, but as Lindsay Clay says, on-demand is growing. Agencies need to be the leading voice for brands to keep ahead and win as the world moves forward.
Today, future facing agencies will have a holistic view of the entire customer journey, helping brands show up in the moments that matter most - whether that’s on social, on demand, at the point of purchase, or - you’ve got it - on TV.
And it’s not stopping anytime soon, the roles of agencies will continue to broaden, and with this, we are likely to see a shift in the way brands appoint and engage. Project-based scopes will begin to increase, and we will see agencies pulled in one of two directions; increase focus and specialise or grow into one that can orchestrate strong connected experiences across all touchpoints.
Jon Goulding, chief executive, Atomic
The Kantar research shows a continual shift from linear TV to digital and on-demand in terms of media effectiveness. But crucially, it also suggests a continual decline in the quality of creative work in those channels and an increase in consumer dissatisfaction with advertising seen as a ‘begrudging interruption’. OOH and Cinema show strong popularity partly due to the ease of consumption but also as it’s combined typically with better creative ideas and production qualities. It makes these channels more acceptable or, dare I say, even enjoyable for people to consume.
So, there are implications, of course, not just for media agencies but also for creative agencies to embrace non-traditional TV further but with an ever-greater responsibility to produce work that consumers appreciate and are entertained by when they consume it. Some might even appreciate it many times over and still have a smile on their face. That would be a worthwhile goal for any brand and creative agency!
Geoff de Burca, joint chief strategy officer, EssenceMediacom
I think the start point in the research here is wrong – viewing TV and other types of videos in silos - when actually the type of quality broadcast content that is the perfect context for building brands is now watched on big screens at the audience’s convenience. Meanwhile the amount of time we spend watching video content of all sorts is growing and spreading to a multitude of formats. There is now a broader AV landscape than ever, all the evidence we see is that planning it holistically allows for no loss of reach and even greater impact. But a siloed or single platform approach doesn’t create the conditions for outsized impact for brands.
Celine Saturnino, managing director, Total Media
TV falling out of favour with marketers could be a point of definition in part, however we have also consistently seen brands either choosing alternative brand platforms that offer a more interactive consumer experience or investing more into short-term acquisition channels this year.
For many agencies the implications of these trends are primarily structural and skills based – agencies with siloed media teams will quickly lose out to integrated propositions providing a holistic approach to planning media across all consumer touchpoints. The focus for agencies with outdated structures has to be investment in training for multi-skilled media planners and integration across divisions.
Moving investment away from linear TV also has implications for resource requirements with areas such as digital media, requiring more intensive agency resourcing. Naturally, this impacts cost management and the future agency model requires a laser-sharp focus on the use of machine learning and automation to reduce time spent on administrative and repetitive tasks.
Lastly, agency commercial models require a complete overhaul as the legacy model of commission as a percentage of media (which is still the way a large number of contracts are traded either in part or in full), is outdated and not at all in touch with the requirements of modern media.
Theo Izzard-Brown, chief strategy officer, Dentsu Creative UK
Clay is right to differentiate between linear and on-demand TV. TV media is costing more for fewer eyeballs, which in a time of flat media budgets makes linear TV in isolation a hard sell. OFCOM reports the number of programmes pulling in more than 4m viewers has halved since 2014, there were only 48 of them in 2022.
The real question isn’t so much ‘where’ as ‘how’. In today’s new entertainment economy brands are built and grown in altogether new ways. People will happily spend a lot or precisely no time with brands based upon their ability to entertain, and media innovation often plays a part. In Ronseal’s case we invited the British public to watch paint dry for an entire 3-minute ad break and launched the highest rated advertiser funded programme in its Channel 4 timeslot with the Great Garden Revolution.
Lisa Stoney, joint head of planning, adam&eveDDB
The shift away from TV advertising has not felt dissimilar to watching icebergs melt in the Arctic: we rationally know it’s happening, but emotionally haven’t accepted it. Regardless, we’ve had to adapt while holding onto two truths: TV advertising is still a ‘thing’ (it’s usually the most effective for brands with a healthy budget) but also, it’s not really TV advertising anymore - it’s just video advertising that needs to work in every format, time length and across media. This changes the creative challenge, but doesn’t diminish it. With the exception of Christmas and a few other tentpole moments, the ‘big reveal’ has already had its day. That simply means the focus can gravitate back towards what we’re all here for: the work. And making great, brand led stories that sell things. Whether you’re watching your favourite Christmas ad on Instagram, YouTube or TV is by the by - people love stories, and stories work brilliantly as video. So the future is video, wherever it lives.