Should your local-direct business clients consider FAST (Free Ad Supported TV as another way to zero in on more potential diverse consumers in your DMA? Philip Jay LeNoble, M.B.A, PhD.

42% Of Buyers To Spend $25M+ On FASTs In 2023, Most Will Up Spend In 2024

• by Karlene Lukovitz  @KLmarketdaily, 7 hours ago

New research among ad buyers from Comcast Advertising and Xumo finds 42% of those currently using free, ad-supported streaming services/FASTs expecting to spend more than $25 million on FASTs this year, and 84% of current users expecting to increase FAST spend next year.

Comcast and Xumo -- which is co-owned by Comcast and Charter and includes the Xumo Play FAST platform -- worked with CRG Global VP, Media Research Gavin Bridge to conduct both advertiser and consumer surveys for a just-released “State of FAST” report.

The advertiser research, fielded in September, included separate surveys of 75 ad buyers currently using FASTs and 75 currently not using FASTs, as well as qualitative interviews with current users.

Among the 75 current users, 70% reported that they started using FASTs in the past 12 months.

(The report also notes that in a study conducted for Comcast by Advertiser Perceptions in August, 48% of 305 ad buyers surveyed reported currently including FASTs in their media buys and plans, and 56% of those not yet using FASTs said they expected to use FASTs before the end of 2023.)

In the new ad-buyer survey, nearly a quarter (24%) of current FAST users said they expect to spend between $6 million and $10 million on those types of channels in 2023, 23% between $26 million and $50 million, 17% between $11 million and $25 million, 17% $5 million or less, 15% $51 million to $100 million, and 4% more than $100 million.

Asked about why they are using FASTs, three in five said they use them to target a specific audience; 54% said they use it to extend the reach of their audience; half said they use FASTs to reach cable subscribers who are watching FAST channels; and two in five said they use it because of cost effectiveness.

In a question probing attitudes about FASTs, 71% of current users and 67% of current non-users said FASTs allow advertisers to reach audiences they can’t reach through other channels.

In addition, 73% of current users and 68% of non-users said FASTs are among “the viewing formats of the future,” and 61% of users and 60% of non-users said that the linear nature of FASTs are appealing as an advertising format.

Half of current users report running campaigns across multiple FAST services, and a third say they’ve run campaigns that include only one FAST.

The report notes that buys can occur across groups of channels by genre, by individual channels, or by a targeted blend of different genres to reach a specific demo.

The report also includes stats based on an analysis of Comcast aggregated viewership data combined with ad exposure data from TV and Effectv streaming campaigns in first-half 2023.

FAST impressions were found to be 10 times more likely to be delivered within hard-to-reach households than traditional TV impressions, and 2.3 times more likely to be delivered within hard-to-reach households than other streaming sectors.

In addition, 88% of the highest-reaching multiscreen campaigns included FASTs, and 94% of FAST impressions are on TV screens.

In a separate study of 4,000 U.S consumers 18 and older, conducted in August, nearly half reported watching at least one FAST service. On average, viewers reported using 1.9 FAST services.

More than half (56%) agreed that FAST channels are as good as cable channels, 57% rated FAST channels as entertaining, and 69% said the can “always find something to watch” on FASTs.

Separately, the report notes that Xumo internal viewership data for 1H 2023 found news accounting for 39% of viewing time on the Xumo Play FAST platform, followed by crime TV (17%), movies (10%), action and drama (5%), sports (5%) and game shows (3%). Other genres accounted for 21% of viewing time.

Xumo users spent 136% more time watching FASTs than ad-supported video-on-demand services in 2023’s first half.  

 With diverse audiences watching TV or listening to radio, a local-direct business should consider how their product lines or services may impact a diverse audience and keep that in mind whence they to get deeper into better targeting in media marketing and advertising. Philip Jay LeNoble, M.B.A., PhD 

What Brands Must Understand About Multicultural Audiences

• by Anabela Bonuccelli , November 1, 2023

As the ad industry continues to grapple with the best ways to connect with multicultural audiences, there’s clearly still more work to be done. What many marketers are missing is that reaching out to multicultural audiences means more than just thinking about ethnicity -- it’s about identity. As an industry, we have to find ways to help brands engage with people of diverse identities in a truly meaningful way. To do that effectively, there are a few things to keep in mind.

Multicultural marketing is mainstream marketing. With multicultural consumers making up more than 40% of the U.S. population and $3.9 trillion in spending power, brands should adapt their mindset and stop thinking about general market and multicultural marketing separately. Today, brands need to think and plan for an “integrated market” inclusive of all identities.

Representation is fundamental, and although mass media allows brands to maximize their reach within their target, being present in diverse media outlets will help brands connect better to these minorities. This will enable brands to become more meaningful, and, in consequence, will maximize profit because it’s proven that the more meaningful the brand is, the better the business performs.

Be intentional! Begin with a strategy that gives you meaningful reasons to connect with multicultural audiences and make sure you are aligned at every level within your organization.

Simply translating your ad isn’t inherently bad, but will it meaningfully connect with your intended audience? You’ll see greater success through intentional creative that speaks directly to your multicultural consumers and inspires brand loyalty through those genuine communications.

Invest in research, understand cultural insights, passions, and habits to connect in a more meaningful, and relevant context. Set clear KPI’s, be open to learning, trying new things, and always measure results.

It’s important to formalize creative development processes and find new ways of teaming up internally to bring new voices to the table. Use your existing employee resource groups and DE&I resources.

Multicultural means authentic representation. Brands with purpose have strong strategies and are considered a powerhouse when it comes to multicultural audiences. The ability to match and translate the brand’s values with those of the general and diverse audiences generates great results for branding and business.

Consumers have high expectations for the brands they engage with. In our 2023 Meaningful Brands study, we found that 71% of respondents think companies and brands should be doing more to improve and support their personal health and well-being. We also know that consumers are skeptical of brands who claim to have altruistic or humanitarian intentions.

Multicultural voices are everywhere, and they all need and deserve to be heard. People must always be front and center. It’s time to embrace the nuances and go beyond stereotypes, and that begins with the customers.

There’s diversity within the diversity. One size has never fit all -- and that’s especially true for multicultural audiences. It’s vital to be both in-language and in-culture for your multicultural consumers.

Becoming inclusive thinkers and marketers starts with an inclusive brief and being open to taking risks. Make sure your advertising (both owned and paid) has the right representation and is culturally relevant, avoiding any types of stereotypes.

We are a multicultural country and that is part of our strength -- one that can certainly become part of your brand when you incentivize and nurture diverse thinking into your integrated marketing and communication strategies.

 

TV Commercial Pricing Weakness... For The NFL? Define Weakness

• by Wayne Friedman , Staff Writer, November 2, 2023

Could the NFL be having TV commercial pricing issues? Not directly, according to executives contacted by TV Watch.

Media buyers and some reports surmise that some scatter pricing -- buying a TV commercial for a game, for example, just days before the game is televised -- could be seeing some softness.

This could be partly due to recent automotive strike issues, which slowed down production of cars. This would be the latest in the number of dings for automotive marketers starting with the chip scarcity in 2021.

One report suggests pricing is down as much as 5% -- which would be a rare occurrence. But veteran media agency executives counter that it is at best flat versus upfront deals set in the summer for NFL programming.

"It is a qualified 'soft' [market]," according to one executive. "The reality is the [NFL] ratings have been strong, really across the board," 

For some, the possibility of some weakness could be attributed to ABC Television Network’s sort-of-late decision to simulcast all “Monday Night Football” games along with ESPN.

The theory is that those newly added big broadcast NFL TV impressions resulted in a change in the supply-and-demand formula for advertisers: More supply against the same demand.

"So few ADUs [audience deficiency units], if any, are needed to be given out," says the executive. "Those go back into sale, thus 'softening' the market. It's not that there isn’t interest. There is -- strong interest. But the market in total is soft -- not a lot of new dollars working." 

Complicating some of this is the flip side of the picture: Broadcast networks not being able to offer much in the way of fresh scripted prime-time programming for the last six weeks or so -- due to the the writers' and then actors' strike heading into the new TV season that started in late September.

That would have meant that some veteran big brand advertisers were desperately seeking to buy some high-impact TV programming. The NFL would fit the bill, imperfectly -- football not really fitting every marketer's needed audience profile. 

Still, the market for potential new-ish NFL advertisers is small. Also, TV commercials in NFL games do not come cheap, with a price tag that can be $400,000 to $800,000 or more for a regular-season game depending on the NFL network/daypart.

Cost-conscious consumer packaged-good advertisers, for one, probably would not consider it to a large degree. 

And then there is this: While the overall TV ad marketplace has been slowly recovering, it is still in a tentative state, with nervous executives concerned about a possible recession coming in the next few months.

All this refers back to the scatter marketplace stagnant issues. As a consequence, not much new money is working overall for broadcast scripted/non-scripted prime-time or additional impressions now provided by highly viewed NFL programming.

Typically, as the season goes on, spending by traditional NFL advertising categories can build as competition among teams becomes more intense and interesting, moving toward the post-season.

All this is to say that we should expect the playoffs -- and of course the Super Bowl -- to continue to see strong million-dollar level TV commercial buys.

Estimates for this year’s February big event hit another record for a 30-second commercial -- just $7 million. Expect more of the same.

Until then -- pricing issues? There will be some happy NFL buying over the next eight weeks of the season for some.

 

Falling Media Stocks? Pressure To Sell Legacy TV Business On The Line

• by Wayne Friedman , Staff Writer, 7 hours ago

Stock market and other pressures on legacy TV-based network groups to sell long-time business is growing -- everything from TV stations to cable networks and other businesses.

Walt Disney has already been subject to a number of analysts pushing it to sell its high-profile sports TV business, ESPN. And then came Bob Iger, chief executive officer of Disney, mulling over the wide consideration of a possible sale of its linear TV networks.

Now, another analyst -- Jessica Reif Ehrlich of Bank of America -- has put a bit of a red flag of sorts on Paramount Global because the company turned down suitors for Showtime and BET, which would have put billions in cash back into the company. 

Her bottom line from an investor's point of view was: “Hard to buy if not for sale.” From that, she now lowers her price buying target for investors $9 from $32. 

In the near term, however, Paramount just reported way-over-projected revenues -- and perhaps more importantly, a narrowing of losses at its closely watched direct-to-consumer (D2C) streaming business. 

Ehrlich says however, that it is important to have perspective here. That $9 price represents “a modest premium to the current trading levels of both Warner Bros. Discovery and Fox [although] a discount to Disney.”

The bottom line is that changing marketplace dynamics will force major changes. Expect some major TV network companies to break ranks and jump into making seemingly earth-shattering decisions to jettison some long-term TV brands that consumers have been close to for years. 

One might sort of believe it is already starting that Comcast's NBCUniversal agreement to sell its non-controlling 30% stake in Hulu for at least $8.4 billion might be included in these potential industry-changing moves. In part, there is already history -- a legacy of sorts with Hulu, now having been around for nearly two decades (2007).

But that probably is not what investors are looking for. Wider-eyes would prevail if a major number of TV/cable networks, TV stations, or other mothership brands were to suddenly depart.

TV network-based legacy media companies may have a hard time in letting go the value of the close viewer engagement these long-term brands own. But steady declines in revenue and cash flow will win the day, especially for near-term Wall Street investors. 

And when they move to actual losses, any major billion-dollar-producing divestitures might be too late.

"You Don't Always Get What You Want!" .... sings the Rolling Stones...Philip Jay LeNoble. PhD

 

Amazon Flooded Search Results With Irrelevant Sponsored Ads, FTC Alleges

• by Karlene Lukovitz  @KLmarketdaily, November 3, 2023

Amazon founder/owner Jeff Bezos instructed executives to flood the giant ecommerce company’s search results with irrelevant ads to pump up its profits, The Federal Trade Commission charges in newly unredacted documents from its antitrust lawsuit against Amazon.

During a key meeting, Bezos directed executives to "accept 'more defects’ as a way to increase the total number of advertisements shown and drive up Amazon’s advertising profits,” the FTC document charges.

“Defect” ads are ones that are irrelevant or mostly irrelevant to the content of a search, according to the agency.

As previously reported in MediaDailyNews, the FTC and 17 states have sued Amazon, alleging that it engages in monopolistic practices, including preventing its marketplace sellers from discounting their products on other sites and requiring sellers to use its fulfillment system in order to participate in Amazon Prime, which offers expedited shipping.

The unredacted version of the lawsuit charges that the irrelevant ads crowded out relevant organic results, showing users products that were “plainly not what the customer searched for,” states the complaint.

But although they were aware that the practice undermined the shopping experience, Amazon executives continued to push out “defect” ads to maximize revenue from its ad auctions, the agency said. “With advertisements being so profitable to Amazon even at higher defect rates, senior Amazon executives agreed, ‘we’d be crazy not to’ increase the number of advertisements shown to shoppers," the FTC wrote.

The agency further alleges that the practice was used to direct consumers toward higher-priced sponsored products. In an undisclosed number of cases, the prices of sponsored products were at least twice as high as products produced by organic results, the complaint charges.

Amazon engineers allegedly determined that the decline in sales resulting from shoppers being shown sponsored ads instead of organic results was “vastly outweighed in the short term by ad revenue.”

The flood of defect ads also increased Amazon marketplace sellers’ costs for getting their products seen, which would likely result in higher prices for consumers, according to the FTC.

Amazon is the country’s third-largest platform by advertising revenue. The company reported generating $12 billion in advertising revenue in this year’s third quarter — up 26% year-over-year.

"Advertising continues to be a major bright spot for Amazon,” Insider Intelligence Analyst Zak Stambor wrote about the Q3 results. “Amazon dominates retail media thanks to its deep understanding of the channel and its ability to effectively deliver relevant ads to its massive customer base.”

Amazon will continue to grow advertising, including through use of generative AI tools, he said. Insider Intelligence estimates that Amazon’s U.S. ad business will reach $33.96 billion this year — up 234% from its ad revenue in the pre-pandemic year of 2019.

After the FTC filed its antitrust suit, Amazon General Counsel David Zapolsky declared it “wrong on the facts and the law,” and said that Amazon looks forward to making that case in court.

He asserted that the practices challenged in the complaint actually have helped “spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store.”

 

World Series Hits New Low: 9.1M Viewers

• by Wayne Friedman , November 3, 2023

This year’s five-game World Series -- won by the Texas Rangers over the Arizona Diamondbacks -- posted a record low for the big event -- down 22% from a year ago, averaging 9.1 million Nielsen-measured viewers.

A year ago, when the Houston Astro beat the Philadelphia Phillies in a six-game series, the World Series averaged 11.8 million viewers.

This year's World Series was also 7% lower than the previous all-time low in 2020 when the Los Angeles Dodgers beat the Tampa Bay Rays in six games, which averaged 9.8 million viewers. That year was hit hard -- as were other professional sports -- scheduling and other disruptions due to the start of the pandemic.

This year, national TV advertising spend, according to estimates from EDO Ad EnGage, amounted to $180.1 million, from 582 airings, totaling 4.9 billion impressions.  

The highest-spending advertisers included Geico, Capital One, T-Mobile, Ford Motor and Google Pixel -- ranging from a high of $9.6 million (Geico) to $7.1 million (Google) in total event spend.

This was roughly the same advertising-spend estimate of the year ago -- $182.2 million.

EDO Ad EnGage estimates total impressions at 6.9 billion. 

For this year's final, fifth game, which clinched the series, Fox -- which airs the World Series -- scored 11.6 million viewers.

This is also a great reminder for local-direct businesses trying to gain further traction in these chaotic times! Philip Jay LeNoble, PhD

 

Invest In Value

• by J. Walker Smith , Op-Ed Contributor, November 1, 2023

The outcry faced by Delta Air Lines over proposed changes in its SkyMiles and SkyClub programs is a good reminder of the risks faced by brands looking to take value out of their products and services.

Now, I feel sure that Delta would take issue with my characterization of the changes it announced in September as value-diminishing. But that’s not how Delta flyers felt, and that’s what matters. Under pressure, Delta scaled back many of those changes about a month later.

Peter Drucker observed once that what customers buy is rarely what a brand thinks it is selling them. Drucker was calling attention to the vulnerabilities a business inflicts on itself when it fails to look at itself through the eyes of its customers.

The foundational idea of marketing is solving people’s problems, which means the customer always comes first, and thus value delivered to customers is what creates value for the bottom line. The converse is also true — when you take value away from customers, the business will suffer.

It is easier than we realize to get turned around by our own success — in particular, by the internal demands of the organizational infrastructure built up to manage our brands.

We end up putting our own interests first. We take customers for granted. We let fads and panics warp our priorities.

This is normal stuff, so I’m not casting stones. We just need to keep reminding ourselves about the value for the customer — which we tend to do about once every ten years, when we take stock as an industry and drill home the idea of customer-centricity yet again.

But sometimes it takes a wake-up call from the marketplace. Like the one Delta got.

It’s not just Delta. It’s every brand right now. Brands need to be investing in value, not squeezing it out.

To begin with, economic pressures are not letting up. Some economists have become more optimistic lately because several macro metrics have trended in a positive direction. Perhaps their optimism is warranted, but I’m more cautious.

I worry that what we’re seeing in these metrics mainly reflects the rapidly diminishing carryover of the atypical circumstances that consumers enjoyed post-pandemic. I am concerned that household budgets will soon be under more — not less — pressure.

Whether pressures are worse or better, however, it is never a good idea to take value out. Doing so may be expedient — even temporarily imperative for internal financial needs — but it always weakens brands.

You are taking away the reasons people have for choosing your brand, thereby opening up your customers to competition. For example, competitive airlines quickly announced frequent flyer status-matching programs to woo away disgruntled elite Delta flyers. Because value was suddenly up for grabs.

We tend to make value mistakes when we confuse price with value. Price is always a big factor, of course, and more so during economic hard times, which is when the temptation is strongest to take value out in order to match the cheapest price. But even in good times, this temptation is tugging at our sleeves.

Brands that continue to invest in more reasons to buy are always better insulated from the vicissitudes of price wars. Such brands are also better able to maintain higher margins and thus to earn stronger bottom lines.

Value doesn’t always immediately trump price, but there’s no way out of a downward price cycle without investing in more value.

So let Delta be a lesson for all of us. Don’t take value out.

Build more value, not less. Deliver greater difference — not a diminishment of reasons to buy.