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Despite challenges, traditional TV remains the premier advertising medium. This report provides data and insights to support TV as the best way to reach audiences. Explore the business of broadcast, the tech advantage for TV, the strength of local TV news, and the opportunities to target African American consumers.
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A Strong Storyline Continues • Various facts and forecasts make it very clear that legacy TV still retains its position as the premier medium, despite decades of challenges from other major traditional media – print, radio, outdoor and direct mail. • Even with a slight erosion of total daily TV viewing time, US adults will spend more than two hours per day more than the time they spend watching digital video during 2017, 2018 and 2019. • This Special Report from Media Group Online provides more than enough information, data and insights to prove to your prospects and clients that, in most cases, TV is still the best advertising medium to reach their audiences.
The Business of Broadcast • 2017 was clearly the year of mergers & acquisitions in the broadcast industry. The total of $8.24 billion was the largest amount since 2014, and the third most since 2008. TV M&A accounted for a sizeable majority, or $5.03 billion. • During Q4 2017 alone, there were deals valued at $500.5 million, with Tegna’s $303 million purchase of Midwest Television Inc.’s San Diego stations the largest. • Other major M&A activity that affects TV includes Discovery’s acquisition of Scripps, QVC buying HSN and Disney acquiring most of 21st Century Fox’s assets. Plus, the proposed Warner and AT&T merger is still in the hands of government regulators.
Another Tech Advantage for TV • With the FCC’s late-2017 approval of ATSC 3.0, or “Next Gen TV,” over-the-air TV stations will be able to implement this new, advanced standard, although it won’t be compatible with existing TV sets. • ATSC 3.0 will provide stations with advanced advertising tactics, such as personalization, or targeting demographics by device and location. • In addition, the technology will allow local stations to add numerous sub-stations that could help to target local audiences more precisely and more efficiently and effectively for advertisers.
Local TV News Is Still Tops • Although an August 2017 survey from Pew Research Center shows continuing erosion in viewership of network, cable and local TV news, local TV news still attracts the largest audience of any of the three TV platforms. • Of the US adults participating in the survey, 37% said they often obtained news from local TV, compared to 28% from cable TV and 26% from network TV.
The “Hidden” Strengths of Local TV News • It’s undeniable that the largest audience for TV news are older adults, but they control more of the total wealth, own the largest homes and have more discretionary income, and many are working beyond retirement age. • Millennials are still struggling with student loan debt, making it difficult to amass a down payment for a home and more of them marry at an older age, which limits and/or delays their value to advertisers as family-based consumers. • Larger percentages of adults with moderate income and education levels watch local TV news. This is an upside for advertisers, however, since these viewers are the bulk of US consumers, not adults with larger incomes and more education.
The Best Source for Entertainment, News and Sports • According to March 2017 survey results from ThinkNow Research of US Internet users, 18–64, live TV (or when a show airs on network TV) was the top source for watching TV content among the four major ethnic groups, except Asian Americans. • It is significant that these are Internet users, who presumably are attracted to the Web to search for and view TV/video content more than non-Internet users. • The age range of 18–64 includes both older Gen Z members and Millennials at the young end of the spectrum and excludes the oldest Baby Boomers, who are the largest age groups of TV viewers.
Reaching the African American Consumer • Another major takeaway from the ThinkNow Research is African Americans are the largest percentage of Americans, by ethnicity, watching live TV. • The buying power of African Americans consumers now exceeds $1.1 trillion annually and is forecast to reach $1.5 trillion by 2021. • In addition, Nielsen reports that African American households with an annual income of $75,000 or more are increasing at a faster rate than all other ethnically defined households.
Deeper Insights into African Americans’ TV Viewing • The total US population (persons 2+) spent 24 hours, 26 minutes weekly watching live TV during Q2 2017; however, the African American population’s live TV viewing time was slightly more than 50% more, at 36 hours, 52 minutes. • African Americans in the very important 18–24, 25–34 and 35–49 age groups significantly exceeded the monthly time their Latino American and Asian American counterparts spent watching live TV. • Since 2008, the number of African American-owned business has increased 34%, many by younger African Americans, contributing to the increase in the percentage of African American households with annual incomes of $75,000 and more.
TV Advertising Gives No Ground • According to BIA/Kelsey’s US Local Advertising Forecast 2018, local TV will be second only to direct mail in total expenditures, at $20.8 billion and $38.5 billion, respectively. • Maybe, more importantly, local TV will account for more than 60% of the local video advertising market, making it the largest source. Local TV will also benefit from 2018 being an Olympics and mid-term election year. • Phase 2 of the Disney-ABC Television study of attribution analysis, which Accenture conducted, indicates programs with a 1.0 rating or greater deliver twice the ROI of programs with a rating of 0.4 or less.
TV Is Trusted • The revelations about Russians’ manipulation of social media content, including news, and the proliferation of so-called “fake news” from other questionable sources, certainly erodes the trust Americans have in these digital news sources. • A 2017 study from Kantar Millward Brown also addresses the trust factor, as it reported consumers are more receptive to advertising from TV than all but two other media, and much more than all digital media listed in the study results. • Of consumers responding to the survey, 49% had a positive receptivity to cinema advertising, making it #1; followed by outdoor, 46%; TV and magazine, 44% each; newspaper, 43%; radio, 39%; and online search, 27%.
A Smart TV Connects the Home to the World • According to a late-2017 report from Parks Associates, a smart TV was the only category of home entertainment devices Parks has measured since Q1 2010 that increased in ownership from Q1 2016 to Q2 2017, at just more than a total of 40%. • A smart TV was the first of all entertainment devices US broadband households that are device owners or service subscribers said they would like to control with a smart speaker/personal assistant. • T-commerce is the purchasing of merchandise via the TV seen in TV commercials and featured in TV shows. According to a December 2017 survey from Connekt, 42% of consumers said are likely to make such purchases during 2018.
TV and Social Media Couldn’t Be Cozier • It’s long been understood that TV viewership is a primary driver of consumers’ search and social media activity – and now there is new data from Nielsen and the Outdoor Advertising Association of America (OAAA) to reinforce this partnership. • Of the 1,089 participating US adults, 57% searched for information online and 40% visited a Facebook page or posted on Facebook in response to content in TV commercials. • TV commercials were a close second to out-of-home ads in the search and social activities of posting on Instagram and Twitter.
The Underutilized Strategy • Clearly, these results support a meaningful strategy for your clients that Media Group Online has strongly advocated for years, but one brands and advertisers especially those using local TV, have failed to implement. • The strategy is to use some or all of a TV commercial message to drive viewers to advertisers/retailers’ Websites and/or social media pages to view product information and to purchase those products. • This strategy is an opportunity for local advertisers to compete in an Amazon-driven environment, not only to sell more product, but also to capture more data about local consumers, and then put that data to optimum use.
