The basic trading mechanism for TV trading hasn’t changed since the 1990s. It’s time for a makeover.
In 2020, we saw an increase in opportunities to access broadcast content outside of the traditional linear trading mechanism. We’ve seen huge developments in ITV’s long-awaited Planet V, an increase in inventory and targeting options with Adsmart, and developments in using clients’ first party data to enhance targeting on BVOD through Infosum. There are now many ways to access broadcast content via digital trading mechanisms, offering better targeting, attribution modeling and more flexibility to advertisers.
Since the rise of digital advertising, ‘the death of TV’ has long been in discussion. But surprisingly the UK linear TV revenue has remained relatively stable. In fact, revenue fell a mere 10% in 2020 vs 2019, despite the global pandemic. Although we had a rocky start to the year, TV revenues rebounded in H2 as the market grew in confidence and as stations offered more flexibility to the market by dropping their 2-month AB deadlines. (A perk we’ve always had at the7stars, but a huge change for the rest of the market.) Understandably, brands needed mass reach around high-quality video content to regain awareness after a difficult H1. This meant that they naturally returned to linear TV. And while it’s hard to say that increased flexibility resulted in the strong revenue numbers in Q3 and Q4, we can assume that it certainly had an impact. So much so, Channel 4 and Sky agreed to drop their 2-month AB deadlines down to 1 month.
Despite this change, it’s looking increasingly likely that we’ll see a decline in linear TV revenue as opportunities in BVOD and Adsmart improve. We may even see SVOD providers turn to advertising models in order to maintain revenue streams. So, what’s next for linear TV and how can it evolve to ensure there’s still a place for linear on a media plan?
- Flexibility is key: continue to reduce AB deadlines by improving camgen/autogen technology at the sales houses
- Move away from TV pricing being traded as a discount off an ITV station price, this is stifling the planning process and taking focus away from clients’ core KPIs
- Trading in volume rather than share will improve transparency in the market and allow for more competitive pricing
- A form of measurement that can report on Broadcast media as a whole: advancement in products such as CFlight – will result in better planning and overall media effectiveness
Altering how TV is currently traded will also have positive effects on the way TV is currently audited. It will take the focus away from a bottom-line discount on an ITV price and basic quality parameters such as PIBs. Instead, it will move towards an auditing process that looks at the effectiveness of a media plan in reaching specific audiences and the business effects for clients.
To summarise, it’s clear that linear TV will be around for a long time. Just as Netflix and Amazon Prime have kept the broadcasters on their toes when it comes to content, broadcasters must now ensure linear TV is accessible and relevant to advertisers in an increasingly digital world, through the way that it’s traded.