The COVID-19 crisis has forced advertisers to rethink their creatives, messaging and media strategies. While the homebound economy has led to higher linear and OTT viewership, brands are under pressure to optimise costs, ensuring that every dollar in an ad budget impacts the bottom line. Calum Smeaton, CEO and Founder of TVSquared, a global provider of linear TV and OTT attribution, discusses what trends he’s seen among advertisers and why his biggest piece of advice is not to go dark.
1. How are brand advertisers approaching TV?
Just a few years ago, there was a much clearer distinction between brand and direct response (DR) advertisers. Today, most brands are DR in some shape or form – using TV to drive actions like online sales, app downloads, in-store purchases and website traffic. While there are those that still use TV primarily for branding, awareness and recall-ability (it’s the best platform for that), there is also a level of performance factored in for them too.
In terms of how advertisers have adapted their TV strategies since COVID-19, it’s been a mixed bag – but one that’s not all doom-and-gloom. In mid-March, we saw many brands “press pause” to make their creatives more situationally appropriate, and then come right back on-air. We’ve seen direct-to-consumer (DTC) categories rushing to get on TV, as viewership is up and inventory prices are down, essentially removing the barrier of entry for many of these young brands. And those investments are paying off because for the last two months, DTC fitness, DTC education and DTC beauty/lifestyle have been the highest performing industries among our global client base.
We’ve also seen reductions in TV spend from travel, real estate and electronics (higher-consideration purchases), and among gambling and sports, which is not surprising due to the lack of live events. Although, it’s worth noting, the end of April marked the first time we saw an increase in TV spend from travel in a while.
Overall, the majority of our brands have stayed on air. Most advertisers understand TV’s halo effect – it’s longer-term impact not only on performance, but also on awareness and recall-ability. While most people are not shopping for cars or vacations at the moment, it doesn’t mean they won’t be in a few months. Staying on TV means staying visible and top-of-mind among consumers when that time comes.
2. Has the change in content available to advertisers impacted TV strategies?
The absence of live sports uprooted one of TV’s staples. While we’re starting to see some sporting events be reintroduced – such as the German Bundesliga and NASCAR in the U.S. – it will be quite a while until it’s back to normal, or a new version of normal. Even though there is still some new content being aired, we are generally a world of reruns and movies. But that is not necessarily a bad thing for advertisers.
We often find that the best performing programs are not the ones that have the highest viewership or ratings. Clients are often surprised at the programmes driving the highest response. We recently had a real-estate brand find that daytime children’s programming was leading to major site traffic. A non-profit doubled its donations after discovering weather-related shows were working well. Examples like this happen all the time.
If anything, the shift in content has brought to light the importance of test-and-learn strategies. Don’t assume you know what your audiences are watching. It’s only through ongoing measurement that you’ll find the buy elements driving engagement (programmes, but also days, times, networks, etc.). Then you can use those learnings to consistently optimise.
3. What is your one top-tip for advertisers at this time?
Do not go dark. I can’t stress this enough. The long-term damage it does to a brand can be significant.
We see this with our own data – the sharp drop in response in the days after a brand goes off TV. Other research shows it too. During the 2008 financial crisis, 60% of advertisers that went dark, cutting all TV spend for six months, saw “brand image“ drop by 28% and “brand use” plummet by 24%.
Brands that can maintain a presence – even a reduced one – in front of the largest at-home audience we’ve seen in recent memory, will be in a much stronger position for recovery.
4. What learnings can advertisers take into a post-COVID-19 era?
The TV industry was already changing prior to COVID-19, moving toward performance, transparency and outcomes. But this pandemic has accelerated that evolution.
The need to be agile is critical. Advertisers that can pivot, change their creatives and get back on-air quickly have a huge advantage. While this type of agility is the norm for digital channels, it hasn’t typically been associated with TV until recently.
The use of real-time analytics is also paramount. It’s what advertisers expect. The sell-side must provide timely, transparent, proof of performance for campaigns to keep pace with other digital channels. Analytics are also the cornerstone for brands to be more agile with their TV strategies.
Calum Smeaton is CEO and Founder at TVSquared