Starcom: TV is now twice the price... but not twice as good
Despite its reputation for brand building, the inflating cost of TV advertising means agencies and their clients need to start looking at how they can build fame through new media, Starcom's executive head of strategy said this week.
"There's still nothing better than [a 30 second ad]," Dan Plant said on a panel at Future of TV Advertising Global.
"Unfortunately it costs twice as much now - and it hasn't got twice as good at what it was doing. You pay twice as much to achieve the same thing."
Questioned on whether he thought television was twice as good as other brand building media, Plant admitted he thought it was - however, "we're now paying beyond that rate of return because we have to just to stay still."
Zenith's latest adspend forecasts have predicted a 7% inflation in TV globally for 2020, after a 5.4% average annual inflation this decade.
Meanwhile, linear TV audiences are in long term decline. According to Ofcom's Media Nations report this year, average daily viewing for all individuals in the UK has declined by 50 minutes since 2010 - rising to 78 minutes among 16-34 year olds.
Earlier this week, Zenith's head of forecasting, Jonathan Barnard, commented that brands had been faced with a choice: "continue to rely on TV, spending more to get less, or invest in data and technology that allows them to aggregate digital audiences cost effectively."
The traditional out of home and print sectors pose a similar problem for advertisers, Plant said, with declining reach and rising costs.
"Out of home has half as many panels in the market as there used to be - you can't buy a national 48 sheet campaign anymore, which used to be the backbone of a fame-driving, simple message across the country," he said.
"And in print, buying a page in a newspaper would get you half the country in a day. You can't do that anymore.
"Those tools aren't as good as they used to be, that's the big problem."
For cost-effective fame building, Plant said advertisers may need to look at different models around TV, claiming that TV sponsorship "is probably the best fame-driving medium right now."
"The cost per impact is still comparable to what it was a few years ago and actually makes you famous for something by attaching you to something."
However, as TV sponsorship comes with long term commitments and contracts - which is "scary" for clients - developing a way to better link the brand work and later activation by retargeting consumers who have been exposed to the sponsorship will be essential.
Sam Day, CMO, Confused.com
Nevertheless, as linear TV audiences decline, Plant said advertisers need to begin looking at new media - such as YouTube - and find ways to build brands there.
"[TV] is still going to be better than anything else for quite a long time, but it's never going to be as good as it was.
"'As seen on TV' used to mean something. 'As seen on YouTube' before I skipped the ad to the cat video doesn't say quite as much about the brand.
"We've got to find, before it's too late, ways in those new media of finding fame and building those signals... I don't know what that is right now. But we are trying."
Later, in an interview with Mediatel Events' director Justin Lebbon, Confused.com's CMO Sam Day disagreed with Plant's assessment of the cost-value exchange TV advertising offers.
"There is no better way for building cover than TV... Please tell me another media that can build cover that cost-effectively," he said.