Saving The TV Business Model

Commentary

by Charlene Weisler, August 13, 2015, 5:00 PM 

As the upfront finishes, we see not only flat and declining sales, but also how this impacts media stock values. While I am no longer a TV network executive, I am an informed advocate of the industry as well as an investor in many media companies. So I have a vested interest in the health of the business and in the success of those working hard to make their companies profitable. 
So with the greatest respect, I say to my friends in the industry: I can’t help but feel frustrated by your slow pace implementing solutions to the changing media environment.
There are many reasons why this stagnation occurs. Internal office environments can sometimes foster fear of change, luddite-ism, risk-aversion and myopia.  Competitive external business forces can sometimes discourage collaboration across corporations. And so we tread water until we either swim or drown.

The current marketplace demands that we take more concrete action. Here are some suggestions on ways to invigorate the business model:

Agree to universal program and ad IDs. Measuring audiences across all possible platforms in a fail-safe, accurate manner is pivotal to maximizing revenue. But it is taking far too long to reach a consensus on standard universal content recognition IDs for programs and ads. Once we can all agree and apply these codes, we can truly maximize the value of all content across all possible and potential platforms.

“We need to make an honest and compelling case for what we need and stop accepting subpar workarounds as the best we can do,” says Janice Finkel-Greene, executive vice president, buying analytics, Initiative MAGNA, and a strong advocate of universal codes. “Systems that were once facilitators have become impediments, but it’s a situation that goes largely unrecognized because it has evolved so slowly. Now it’s something we live with like a morning traffic jam.” But she warns, “The universal codes are only the first big step in the process.  Once they exist, we will have to capture and report them by media outlet for verification and audience analysis.”

Stop negotiating and selling on age and gender proxies. There is nothing more frustrating to me than the continued use of the current proxies of age and gender to transact on television. Not only are they arbitrary breaks, (who came up with Adults 18-49 anyway?) they hardly reflect actual spending habits (which are based on lifestyle more than age). They also terribly undervalue inventory by discrediting and ignoring some of the biggest spenders of certain consumer goods, which are often Adults 50+.

On the front lines of this issue is Hanna Gryncwajg, senior vice president, sales, for RLTV, whose network targets Adults 50+ (which now includes the first wave of Gen Xers). She says, “I believe audience-based buying, driven through purchase and behavior data, would be a win-win for marketers and consumers.”

Compensating for declines by increasing the ad load only makes it worse. How many times do we “solve” for under-delivery by increasing the ad load? While it might be a short-term fix, it can soon become a vicious cycle that only denigrates content quality, encourages more ad skipping, and further erodes overall delivery.

There are probably many solutions to this problem. A few years ago, I advocated for pod curation: higher-performing ads could be rewarded with better pod position. Pod lengths could be calculated more scientifically – perhaps by program genre. Neuroscience precepts could be used to improve promo performance in the “A” position and rank ads more effectively. Taking these steps might even help slow ad-skipping.

Steve Sternberg, former senior vice president, research, at ION Media, and author of The Sternberg Report, has conducted extensive pod research. He says, "Part of the problem is that Nielsen's C3 measurement does not measure commercials, commercial pods, or DVR fast-forwarding. It is really a pretense at measuring commercials.  C3 was designed as a one-year band-aid until exact commercials or commercial pods could be measured by industry post-buy systems. That was eight years ago.
“We know that the first minute in a pod over-delivers C3 by 20-30% while every other commercial minute within the pod under-delivers C3.  So adding additional commercials to a pod should result in further rating declines."

It used to be easy to kick the can down the road and leave the solutions to the next generation of television executives. However, at this business tipping point, we need to act courageously now to ensure that there is a successful next generation.

Engaging A Generation Of Visual Buyers

By Matt Langie Monday, Aug. 17, 2015

We’ve heard a lot from the media about millennials being a generation of narcissistic, lazy and entitled people. But considering there are 75 million millennials in the U.S. alone, I believe it’s unfair to lump them together so readily. These consumers’ lifestyles vary so drastically that it’s nearly impossible to produce far-reaching marketing content. In the fall of 2014, Exponential Interactive released the results of a study they conducted with 4 million young adults. Those who were surveyed self-identified with 12 different sub-groups of millennials – from the “Brogrammer” to the “Millennial Mom.” This substantiates that millennials do not see themselves as a homogenous group. Marketers shouldn’t see them as such either. A more comprehensive depiction of this group is that they are avid users of digital devices. Some 85% own smartphones, a reality that has shifted how millennials are influenced by content and by one another. The ubiquity of digital devices has made it easier than ever to consume loads of content, and that’s exactly what millennials are doing. It comes at a cost, though. The wealth of articles, photos, videos, social media posts and blogs is contributing to everyone’s minimized attention spans. According to a study conducted by Microsoft in 2015, the average attention span is 8 seconds, down from 12 in 2000. This calls for an easier way to consume even more content. With over 2.6 billion images shared daily, visual content is what seems to be making waves. Indeed, platforms dominated by images are seeing the most growth. Tumblr, Pinterest and Instagram were the three fastest-growing networks in 2014, according to data from GlobalWebIndex. Images are certainly the new “language” of the millennial consumer. Capitalizing on the Growth of Images Though a one-size-fits-all marketing approach isn’t likely to perform well with this demographic (or any demo as smart marketers already know), there are specific strategies marketers can adopt to capitalize on the growth of this vast image consumption. Here are my top three I’d recommend for your consideration: 1. Make it easier to for consumers to take action on your images. Millennials spend more money online in a given year than any other age group, according to Business Insider. On average, these consumers spend some $2,000 on ecommerce per year. The takeaway for marketers is to make it as seamless as possible for them to shop for the products they love on platforms they frequent. On Instagram, for example, many brands have turned their Instagram feeds into shop-able galleries, and in turn, they are driving qualified traffic and revenue to their websites. One online retailer found that mobile visitors referred from Instagram averaged 19% more page views than the brand’s average mobile user, while another saw Instagram become a top revenue driver. 2. Harness user-generated content. Gen Y consumers can be just as effective as the world’s top marketers when it comes to influencing other shoppers. Some 68% of millennial social media users in the U.S. reported in a 2014 Webby Awards survey that they are at least somewhat likely to make a purchase based on a friend’s social post. User-generated content is tremendous. The consumers of today love celebrating new purchases and experiences on image platforms. Marketers should use that to their advantage. Fan images can be harnessed to drive engagement on social sites, ecommerce pages, emails and other channels. The use of fan images has earned one luxury retailer a20% click-through rate online and an 11% increase in time-on-site. It pays off. 3. Tap influencers. A survey conducted by Variety in 2014 found that YouTube stars are more influential with U.S. teens than are mainstream celebrities. Though millennials are slightly older, the idea isn’t far off base. Brands are already benefitting from tapping the self-made Instagram, Pinterest and YouTube influencers. An online beauty retailer, for example, sees more than 16,000 image submissions per month from fans. The inclusion of these photos on the brand website have contributed tonearly a four-fold lift in on-site engagement. Turning Pictures Into Points of Purchase To the visual consumers of today, images go beyond aspiration and celebration. Photos are becoming the point of purchase. Always-on shoppers expect every image they encounter to be actionable in some way. Brands who don’t take note will miss out on valuable relationships with this crucial demographic.

Keeping Up With The Millennials

by Thom Forbes, August 14, 2015, 12:33 PM 

Susan Murphy figures she’s been doing content marketing since she was graduated from Marquette University with a degree in journalism 30 years ago and landed a job as an assistant account executive at Edelman Public Relations. Still, sitting in meetings lately with younger, tech-savvy associates, she has been wondering if everything has been moving faster than her ability to keep up through hands-on osmosis.

“My biggest fear is becoming a dinosaur,” she says. And so, when she saw an offer for a free trial of lynda.com, the online learning company acquired by LinkedIn in April for $1.5 billion, she signed up not only to learn new skills, but also to see if she really knew what she thought she did about posting, tweeting and brand vigilance, 24/7.

“The first day that I logged on and started taking notes about what courses I’d be inte
rested in, I came up with 32 of them,” she says. “Most are in areas related to content marketing.”
Over the years, Murphy has ghostwritten op-eds and letters to the editor, implemented internal and external communications plans as an in-house manager and freelance consultant, and developed scripts and speeches for the likes of General Electric’s Jeffrey Immelt, Time Inc.’s Dick Parsons and America’s Walter Cronkite.

Not that emerging content platforms have escaped her attention. Murphy has long been a fervent personal networker on Facebook and LinkedIn. As senior vice president of public relations for the Ad Council in the late ’00s, Murphy was responsible for introducing social media programs into the mix of the organization's public service advertising campaigns.

“Content marketing is something I’ve always done naturally,” she says, “but I feel like it is becoming a specialty with certain formulas and best practices.” And that has made the formulaic press release about as relevant as the press agents of yore looking to get their clients a line or two of “ink” from a newspaper columnist.

“It’s all about delivering value now, because everyone is suffering from information overload and time poverty,” Murphy says.

There are several educational options open to mid-career professionals who want to keep up with digitally native Millennials, such as Marketing Profs, the Content Marketing Institute, and many events, including MediaPost summits.

Academia is getting into the act, too. The Newhouse School at Syracuse University, for example, has partnered with the social media platform company Hootsuite in a self-paced, 15-lesson “Advanced Social Media Strategy” course that takes most students 60 hours to complete and provides an “industry recognized” credential when they do.

Then again, there’s the time-honored technique of crying for help when you need it.
Last week Emma Siemasko posted about being asked to write a video script by the owner of a company for whom she had created “hundreds of blog posts, emails, and other marketing assets.” She had never done a script before, but quickly said “yes” — and then asked two colleagues in the know for some brainstorming help. She now has enough experience to pass along tips herself about the fastest-growing segment in content marketing.

Meanwhile, Murphy has so far taken three courses on lynda.com. Two were about Twitter, and mostly confirmed that she pretty much knows what’s what with 140-character branding messages, though she says she learned a few useful tips about photo use. But an offering about Google Analytics took her well beyond her basic understanding, enabling her to tailor future reporting to exactly what her clients need to know.

Murphy immediately signed on for a subscription to Lynda.com when her trial ended. Different packages range from $19.99 to S34.99 per month for unlimited access to all videos.
Besides the extensive course list, Murphy “loves” the way the information is presented (“I can hit pause and take notes”), the additional articles that are available on trending topics, and the overall cost, ease and convenience. “You know, I could learn anything on there,” she says -- with only a hint of incredulity. Online reviewers like PCMag.com’s Jill Duffy are similarly effusive.
On Monday Murphy is starting a new staff position as the director of communications for Friends of Recovery -- New York. It’s a cause she’s passionate about, so the expected long hours and heavy travel schedule don’t daunt her at all. But she has promised herself to make the time to complete at least one course a week on lynda.com, whether it’s something to do directly with content or finally learning HTML.

So, what are you doing to stay relevant?

'Newsmen' Williams, Stewart Poised To Make Headlines In August

by Adam Buckman, July 28, 2015, 12:24 PM   

It seems like it was only yesterday …
To be specific, it was an action-packed week back in February -- the week of Feb. 9-13 -- when Jon Stewart surprised us all by announcing he would call it quits this summer and, at around the same time, NBC was sentencing wayward news anchor Brian Williams to a six-month suspension without pay following his infamous tall-tale scandal.

Well, here we are on the threshold of August and both of these legendary newsmen are poised to make headlines in the same month yet again. (I know I just casually described Stewart as a “legendary newsman” and then just let it sit there. I promise you more on that farther down.)

Stewart will soon leave. And Williams will return, but in what appears on the surface to be a diminished role at NBC News.

On the other hand, the relative significance of Williams' new role -- “breaking news” anchor on MSNBC -- depends on what NBC News brass under division chief Andy Lack has in store for MSNBC. The rumors are that the low-rated cable channel will jettison a chunk of its talk shows (particularly the ones that air in the daytime) in favor of a harder news approach that will position the network as more of a cable adjunct of NBC News, instead of a destination for liberal talk shows that few people watch.

If MSNBC adopts a hard-news approach, then Williams might be resurrected as a very visible national news anchor once again. My advice: Keep him away from the late-night comedy shows or, for that matter, any environment where he might be tempted to go off-script again and tell stories embellishing his experiences covering various hot spots. The fact is, despite the New York Post's insistence on calling him “Lyin’ Brian” in every story the paper publishes about him, he stands a reasonable chance of resurrecting himself in the court of public opinion. Just look at A-Rod.
Speaking of late-night comedy, just in case you have not yet marked your calendar (do people still “mark calendars”?), Jon Stewart's last show as host of “The Daily Show” on Comedy Central is next Thursday, Aug. 6.

His final four shows (next Monday through Thursday) will be closely watched and widely covered, especially his finale. Pundits will write about Stewart's contributions to the culture, particularly how he melded news and comedy until the two became indistinguishable, at least to his target audience of younger viewers and core followers who were said to have adopted “The Daily Show” as their principal source of nightly “news.”

The same was once said of Jay Leno's monologues on “The Tonight Show.” And it was true, to a degree: If you had not checked in on any news Web sites, watched any TV newscasts or tuned into any news on the radio that day, then it was highly likely that the first time you may have heard the day's headlines would have been during a setup for a late-night monologue joke.

Stewart's “Daily Show” went even further -- styling his show like a newscast in which he, as “news anchor,” presented news stories and then rolled his eyes over them, both literally and figuratively. So not only would viewers learn the day’s news (or at least a fraction of it), but they would then have an opportunity to form an opinion about the news based on Stewart's reactions. And since he was so funny and entertaining, it was easy to agree with Stewart's take -- which is why he emerged as such an influential opinion leader.

Airing opinions or otherwise revealing one's reaction to news stories is a privilege enjoyed by comedians -- not news anchors. “Real” newsmen are supposed to report the news without inflections that reveal how they personally feel about it.

Before his career was derailed by scandal (at least temporarily), Williams seemed hopeful of breaking out of TV news and breaking into the comedy business. He apparently loved appearing on late-night comedy shows so much that he was rumored to have explored the idea of promoting himself as a possible replacement for either Leno or David Letterman.

Now he is due to return to TV in a hard-news capacity that will hopefully leave him little room for either commentary or comedy. And that's a good thing. My advice (given here for the second time in this blog post, and not solicited by Williams or anybody else): Leave the comedy to the late-night comedians.

Radio Too Strong To Be ‘Under-Monetized’—iHeart Exec.

INSIDERADIO

Recent Nielsen data showing radio surpassed TV in the first quarter as the nation’s top reach medium is likely to be a talking point during second-quarter earnings season. Rich Bressler, president, COO & CFO of iHeartMedia, used that finding during the company’s results call yesterday as evidence that radio is "under-monetized as a medium." The new info, along with a Nielsen study from last year that showed radio delivered a 6-to-1 return on investment, was cited by Bressler as an important data point in demonstrating the medium’s power "as we continue to close the gap between radio’s consumer scale and engagement and its much lower share of advertising spend." Nieslen data shows two-thirds of radio listening occurs out-of-home, while 66% of mobile media is consumed in-home, stats Bressler used to reinforce radio’s position as the "original mobile medium" at a time when marketers continue to shift dollars to mobile. Bressler also said the company is talking to advertisers about the power of sound. "Consumers are becoming increasingly mobile and we continue to take this message out to advertisers to help them understand why radio should become a bigger part of their media mix and why they should be asking themselves what is our company’s sound strategy?"

Proactive Study Suggests Radio’s Role in Online Purchasing Power. A customer may be buying skin care products online, but that doesn’t mean online deserves all the credit for setting up the sale. This comes according to new analysis of skin care product line Proactiv by AdAge, which suggests radio and TV play an important role as an online purchase table setter. The numbers indicated that traditional media advertising is vital to online shopping. Proactiv, owned by Guthy-Renker, is a heavy direct marketer and uses online, TV and radio to promote its sales. With both direct marketing and traditional product advertising, conventional wisdom often says that the last medium to deliver an advertising message can drive a sale. That concept of recency has long been one of radio’s major selling points, particularly given its ability to reach listeners in their cars on their way to stores. In online advertising, the equivalent is clicking through on a search ad, or "last-click attribution," which gets credit as the driving force for an online sale. Skeptics have long argued that online purchasing decisions are much more complicated, akin to the salesman who does all the work with one customer, only to see another salesman swoop in to get the final sales commission. A look at Proactiv’s online sales by Facebook’s Atlas ad serving and analytics unit, published in AdAge, suggests the theory isn’t quite so cut and dry. Atlas found that while 43% of online sales came directly from clicks on a display ad, with 41% coming straight from search ads, another 16% of sales came from a mix of the two, meaning the buyer searched for a product after first getting the idea from a separate display ad. First Responder: See how radio’s ad influence might fit into this mix at insideradio.com

Second-Year Spend Crucial For Success—Nielsen. Anyone in radio sales looking for a good stat to suggest the advantage of a long-term contract received a gift that keeps on giving from Nielsen. According to a new research report, successful growing brands are the ones that maintain 94% of their year-one media spend into the second year—a crucial stat compared to brands that don’t. In the report, Nielsen asserts that sales for 55% of all new products start to slide as they enter the second year in the market and by year three, 69% of all new products experience declines. The measuring giant’s new "How to Succeed In Years Two and Three" study also says that among businesses that start to falter, the majority see sales decline of 30% or more following year one. The way to prevent that? Keep your year-two media spend just about what it was in year one, when new businesses usually spend the most. Brands that decline tend to cut their budgets 80% in year-two, on average. The ones that don’t maintain that year-one growth, leading Nielsen to further suggest that it might be better to delay second-year product launches to spend the money making sure the original product line gets solid year-two support. The research is based on 600 case studies.

Location Tracking Is The New Attribution Engine

by Steve Smith @popeyesm, July 30, 2015, 11:14 AM   

Mobile technology has had a direct impact on the way marketers can conceive and measure the idea of place. Leveraging a number of different methods and metrics, analytics startups have used LBS capabilities to profile locations, track user activities within spaces, and even tie that activity back to ad exposure.

The potential here for attribution modeling is vast. Digital advertisers have been looking every which way to “close the loop” still separating digital activity and in-store behavior and spend.

Among the providers that have captured agency attention, Placed has been using its large panel-based location tracking to make these connections. It already has a popular attribution product that connects mobile ad spend to store visits.

This week, the company expands that capability with the promise of tying ad exposures to purchase rate and even consumer spending level. According to CEO David Shim, Placed Revenue, the panel of double-opted in consumers constitutes “1 in 450” U.S. adults. The Placed app tracks not only panel members’ movements and ad experiences but can also send surveys to assess what the consumers actually spent.

“In addition to this first party data set, Placed has been working with a handful of retailers and restaurants to tune its data against their internal sales metrics,” he tells Mobile Marketing Daily.
To show off some of its capabilities, Placed has already tracked and polled over 2 million consumers to create indexes the purchase rate and average spend of store visitors. 99 Cents Only, Dollar Tree and Dollar General top the purchase rate index — meaning that they have the highest rates of converting store visitors to buyers.

While the bargain pricing clearly drives conversion rates at dollar stores, the big box and wholesale providers lead in average spend. Placed’s average spend index finds Costco, Best Buy and B.J.’s indexing at over twice the industry average.

Being able to tie mobile ad spend to retail conversions and even spend conceivably helps to fill in one of the persistent blind spots in mobile. We know intuitively that mobile plays a role in driving people towards purchase decisions that they consummate either on the desktop Web or at retail.
Connecting the mobile user to their desktop behaviors has proven to be an attribution challenge all it sown. Attributing retail behaviors to mobile exposures has been even tougher.

The accuracy of self-reported behaviors is always problematic. Shim tells us that they are working on that piece. “In addition to this first party data set, Placed has been working with a handful of retailers and restaurants to tune its data against their internal sales metrics,” he says. The consumers are surveyed 6 to 18 hours after the visit, so as not to intrude on the shopping trip itself. Shim says that they run test questions to identify “bad actors” who seem to be responding falsely.

The real hat trick of attribution is tying mobile exposures to Web and other ad exposures to get a more holistic sense of how with weight mobile advertising in the larger marketing mix. Placed is connected with cross-screen platforms like Drawbridge, distillery and Tapad, among others, to connect the dots, or, users.

Using combinations of location tracking, surveying and even local store sales lift metrics are among the things that companies like Placed and 4Info are using to try to target and attribute mobile advertising with sales. The ultimate aim is tracking individual user IDs from ad exposure to connected in-store sales operation that can attribute ad impact on a one to one basis across multiple connected media.

Until then, mobile and location tracking of consumers will continue to be new tools in the attribution box.

By the way, attribution has become such a focus of marketer attention that we are launching our first show dedicated to the topic at Advertising Week. OMMA Attribution on Sept. 29 in New York will look especially at analysts lurching towards solutions that measure ad impact across online and offline media.  

Madison Avenue Shifts $2 Billion Out Of 'Traditional' Media In 9 Months

I've always been recommending each broadcast company train their reps on gaining a strong footprint with long-term local direct revenue to support and bolster the balance sheets against the coming shift in transactional business. Mature reps have consistently disregarded these warnings as did their managers and now we can see a beginning of a shift that will have major consequences affect the net margins of television and radio companies in the U.S. fr the foreseeable future. Philip Jay LeNoble, Ph.D. CA

by Joe Mandese @mp_joemandese, July 30, 2015, 8:56 AM

In what likely is the first comprehensive analysis of actual data from big agency media buys of its kind, Madison Avenue’s major agency holding companies have boosted their spending in digital media by $3 billion during a nine-month period ending with June 2015, and most of it came at the expense of traditional media. The data, which was released Wednesday by Standard Media Index, looked at the those months, because they happen to coincide with the so-called “broadcast year,” which is the way TV networks and stations typically account for their advertising revenues. Not surprisingly, the biggest hit in Madison Avenue’s digital media shift is coming from their TV advertising budgets.

 

“The results show that digital is siphoning share away from other media, with the bulk of it coming from television,” explained SMI’s Bree Sutton, noting that national TV ad spending trends have been reflecting that.

 

“On the national TV front, the scatter market has clawed back about 35% of the ad revenue lost in the soft 14-15 upfront, however the remainder of those dollars have flowed into digital,” she pointed out.

What makes the analysis so significant is that it’s not based on third-party estimates, but is derived from actual media buys processed by big ad agencies representing about 80% of holding company billings. The analysis estimates only about $1 billion of the $3 billion in digital spending was “organic,” meaning it came from new budgets earmarked for digital media. The rest presumably came at the expense of other media.

 

While digital spending is up a total of 16% during the nine-month period, national TV spending fell by $1.1 billion, or about 4%. And total TV spending fell about $1.5 billion (about $5%).

While there are some macro factors driving those declines -- including comparisons with year-ago spending that included the World Cup Soccer tournament -- there clearly is a more secular shift going on too.

The SMI analysis estimates about $350 million of digital’s growth came at the expense of “print” media, and about $150 million came out of radio.