Hi everyone. Iâm here to talk to you about TV buying â so traditional TV buying â and why this year could be a fundamental change into the way TV is being bought.
Advertising before digital
Now to do that, Iâm going to take you in a little bit of a journey, Iâm going to reminisce to back in the day, when I was a little cheeky chappy between the age of 18 to 21. I used to work at Express Newspapers, that was first on Black Friars Bridge, and then was in Lower Thames Street so, both in London. Back in those days, I didnât need the beard because I didnât have a double chin, and I didnât need to hide it. I often got the tube with my mum, very different to now. I almost put a picture in, but I thought Iâd embarrass myself a little bit too much!
My job, working in newspapers for Express, there was many different titles but, I mainly worked in the classified advertising section. It was interesting because I was often dealing with the same West End media agencies, whose job it was to divvy up advertising spend. My job was to convince them that for their market or for what theyâre trying to achieve for a client, that Express Newspapers was right for them or whether itâd be the Daily Star, even OK! Magazine. So, I was in constant communication.
But, if you think about these agencies and what they need to do and these buyers, theyâll be getting briefs from clients and then theyâll be deciding how they divvy up the media budget for many different areas. This a lot more complex in our modern day, but back then, youâd consider newspapers â if itâs mid-market, you might consider Daily Express, Sunday Express. You might look at associated newspapers, so Daily Mail, Mail on Sunday, in terms of similar target audience, but then youâve got to consider the likes of outdoor. So, theyâd have really good relationships with the likes of Clear Channel, which is a major outdoor provider. Youâd be considering radio, and also what my talk is mainly around, around TV.
The problem with wastage
But, the one thing thatâs consistent in all of thisâŠand just to put it in a bit of context, if youâre planning, if youâve got a big budget, and youâre planning a big campaign, and youâre looking at a slot â for example, with Coronation Street â youâre going to hit a huge audience. But whatâs acceptable in all of these cases back then â and itâs a long time ago when in was 18 to 21 by the way â thereâs going to be wastage.
Yes, thereâs going to be many eyeballs on your campaigns, on your creative, but so many people that are relevant to your brand and that are potentially not going to purchase.
So, why am I talking about this change in today? Whatâs kind of driving that talk? And if we look at that, itâs fundamentally technology.
How technology has changed media buying
So, technology and how itâs advanced is changing this landscape as we speak, and this yearâs going to be fundamental for that.
Now, what Iâm talking about here is, just look at the way we typically trade media. So, itâs our understanding, a lot of understanding for clients is, when they think of Display, they think of things like re-targeting. They think of Googleâs display banners and just ads around a website. But, technology is advancing so much in terms of what we can buy programmatically.
Sky AdSmart
So, an example of this is, weâre as an agency very familiar with these guys, but a lot of people arenât. Sky AdSmart have been around for more than three years now. Theyâve been doing this and advancing their product and let me just talk to you about what Sky AdSmart actually is.
Just taking a step back. Seven million boxes. Weâll talk about different targeting attributes but, in terms of what they consider as viewability, when you see an advert on one of their platforms, when they count for it in terms of you actually paying for that impression, someone has to have viewed 75 percent of that content.
So, if we actually talk about audience targeting, the way that you actually work with something like Sky AdSmart; youâre not broadcasting to mass. You can overlay it with so much audience data. So, for example, they have access to many different data sources: Experian, Mosaic data. If youâre a car insurance provider, so youâre one of the big players, they will know how many cars are in your household, the age of people in your household. Also, more importantly, when your car insurance is up for renewal. So, they can target you based on that information. They can overlay it with: âOkay, we know for our audience, we convert best in these locationsâ. Thereâs so much. They can get so granular on how they target you, so theyâre not just broadcasting to the mass, and theyâre cutting all of that wastage, which is really important.
Even the frequency that you see it and how quickly these campaigns can go live is just very different to the way we would typically plan. Comparing that, so if you look at linear TV against Sky Ad Smart, if we just put this into perspective.
How TV advertising has changed
So again, taking you on a bit of a journey and thereâs a bit of a plug now into me personally.
2005: you probably remember where you were when Liverpool were playing the Champions League final against AC Milan? Three nil down at half time, I wasnât watching this on TV because I was there by the way! Just a little bit of a ⊠Watching Liverpool in the Champions League for the fifth time that might be. But, if youâre at home youâre lucky enough to watch it on ITV or Sky Sports, youâd have all seen the same ads. Like, if you were watching it on the same platform, you would have got exactly the same experience.
Now, good news is, Liverpool are still in the Champions League, I hope when people at home watch this content, we are still in it as well, or weâve won it, but the difference is, if youâre watching it on Sky this year, or if itâs published on Sky, you could get a very different experience. Thatâs a good thing, because it should be relevant to you. It should be companies that you like, or youâre likely to engage with. So, that is fundamentally the difference. Itâs going to be personalised, and itâs based on data in terms of how people are buying this media.
Again, it talks about the cost per thousand is lower. And it is, but thereâs so much wastage, so you are going to pay more for impression, but youâre not paying for people that you donât want to reach. So actually, in effect, itâs far more targeted and actually cheaper.
Analytics as well, thereâs not much data you get on traditional TV media buying. Yes, you can assess how much the phoneâs picked up etc., but the data you get on this is far and beyond, so you can properly start to test.
Why is 2018 the year everything changes?
Now, Iâve talked about why this is the year this changes forever. Iâve said Sky AdSmart has been around for a number of years, and it has. There is more awareness around it, but if you look at some of these players, and Johnâs done a brilliant talk on TV â John Shepherd from RocketMill.
But, thereâs two other major buying houses here in terms of ITV and Channel Four. ITV is roughly around the third of the market. Now, look in the media. There is so much content about what theyâre doing at the moment because the pressures theyâre under, they are partnering with technology providers to be able to offer their inventory programmatically, so similar to Sky AdSmart. That is happening this year.
Now, thereâs not going to be a huge shift into all of that money going straight onto those platforms this year, however it is going to be possible, so weâre setting the foundation that thereâs going to be a big shift in the next couple of years.
Furthermore, this talkâs around TV. Look at Clear Channel, I talked about them earlier. Huge outdoor provider, you will programmatically be able to buy outdoor as well, and thatâs already been tested in certain territories as well. And that is something thatâs coming this year.
How these changes impact the market
Now, okay, all this change, is it having an impact? Or what impact will it have? I went back to working with big agencies. Now, back in those days, it was the same agencies I worked with all the time. Youâd have the likes of Mindshare, youâd have the likes of Carat, MEC. Thereâd be so many agencies that weâd speak to, and itâs typically, theyâre looking after the same advertisers as well.
Now, if you look at the pressures this puts those agencies under. The barriers to entry were really difficult. An agency like RocketMill didnât have enough buying power to even enter that market and buy a TV for people. These deals are done around power. So, Mindshare would sit with you and it would go something along the lines of, they buy the most TV, they buy the most print, radio, etc. They can get the best rates, they can get the best spots. They earn from the advertiser, they earn from the TV in terms of how much they are going to be spending. We just canât even enter those conversations, because we donât have the buying power. It stays with those same agencies.
If things are going to be able to trade programmatically, so like how we bid on display etc now, and John talked about in his talk that if you go to Facebook, if you go to it and one personâs got a ÂŁ1,000, one personâs got ÂŁ100,000, it isnât going to make much difference. Itâs all biddable, itâs bought in real time. That argument doesnât happen.
What weâre seeing is, these network agencies, the likes of WPP, MEC and Maxus, have merged. Whatâs happening is, these traditional type of agencies, that argument doesnât work anymore, so they need to become a performance agency. Theyâre bolting on the performance arm of their business, in order to be able to offer clients what theyâre going to need moving forward and actually what they need now. Dentsu Aegis acquired Merkle, we all know Merkle acquired Periscopics who are, again, a performance agency. Neo Ogilvy folding into Mindshare.
These are fundamental changes and if you look online at the likes of WPP, their agency, if you look at all the different agencies, their staff is bigger than the population of Brighton. Thereâs so much consolidation going on and have a look at their share prices. This is one of the drivers behind that, in the change in technology in terms of these restructures.
But also, marketing teams. If you look at some companies, every company we deal with is going to have slightly different internal structures. Sometimes youâve got a marketing team, sometimes youâve got digital teams, brand teams. If youâre thinking about marketing teams and what they would traditionally buy, they would buy print, TV ⊠If this is going to be traded programmatically, then those departments need to just become marketing departments. Weâve talked about that for a long time and we are going to see an impact.
And also, competition changes. Weâre talking about big budgets. You have to have big budgets to be able to complete on TV in the past. Something like Sky AdSmart, you can spend five grand a month, itâs not huge barrier to entry. And competition changes as well, because we talked about overlaying it with local information, these donât need to be big national players, these can be people operating just at a postcode level in terms of what theyâre advertising and overlaying that with the likes of Mosaic data and being very, very targeted in terms of who theyâre reaching. We are going to see different people. Yes, you need creative etc., but this will change the type of companies we see on TV essentially.
TV in 2018
So, what is the key take away? I think, for the big companies, weâve been in meetings where itâs actually been said, that the marketing team say: âThe board just say X percent needs to be spent on TV each yearâ. But we just know itâs very rich content, we just need to spend that. And it just happens year after year after year. So, Iâd encourage for companies like that, youâre still buying TV, just look at the way itâs being bought and start to put a tiny percentage or a small percentage at least, to testing programmatic TV and look at the results. Look at the results, youâre going to be far more targeted and youâre still buying TV.
Also, for the smaller companies, if youâre looking at display and youâre looking at programmatic and youâre testing these different things, consider testing the likes of Sky AdSmart. The barrier isnât huge but thereâs so many more things in terms of possibility and you can get the analytics in terms of actually looking at the results.
Thanks very much.