By Cheryl Huckabay
Are you still developing separate television and streaming video strategies? Does your media flowchart lump streaming radio in the online section and show terrestrial radio as a separate line item?
As broadcast consumption increases outside of television or radio, agencies and advertisers have to begin to think about developing comprehensive audio and video strategies. No longer can you think in terms of television and streaming video, you have to think of video as a whole. How can I best use my video assets to reach my target audience?
It’s the same with radio and streaming radio. What is the best compilation of audio formats that reflect your target’s consumption?
Consumption patterns are shifting. Consumers are using multiple devices at the same time. How many times have you been watching television and surfing the Web, whether on your laptop or cellphone? Consumption is also being shared between devices or completely shifting for some demographics. Adults 18-24 are 32% more likely to listen to streaming audio such as Pandora than to listen to a terrestrial radio station.
Placement
A video or audio asset traditionally produced for advertising is now being consumed on digital platforms, including connected TVs, computers, mobile phones and tablets in addition to traditional devices. Advertisers must take the time to understand how their specific target audience is consuming these assets and on which device it is being consumed, and allocate budgets accordingly.
The largest adjustment for advertisers between traditional formats and digital formats is how the media are purchased. On traditional formats, media buys are based on how a specific program delivers against your target. While you can also do this with digital formats, a lot of the digital video and digital audio inventory is purchased based on the audience. On the digital front, we are finding our target audience online (no matter what program or website they are viewing) and serving them a video asset. The majority of advertisers are still not comfortable purchasing an audience vs. programming in these spaces, but the entire industry is moving this way given the digitization of media.
2012 will be especially important in monitoring these strategies as we enter a political year with the potential of inventory becoming scarce or cost-prohibitive. In these situations, digital may be an important supplement for these buys to maintain specific reach and frequency goals.
Shifting Budgets
So how do we start adjusting our budgets to accommodate these shifting consumption habits? eMarketer reports online video spending increased 40% in 2010. Companies like Yume, in conjunction with Nielsen, have started to conduct studies to see what the appropriate budget levels are to shift from a TV budget to streaming video. They found that not increasing the budget at all, but shifting 5%, 10% and 15% of the budget from traditional TV to streaming increased reach across the board as well as frequency, GRP delivery and efficiency. Brand recall also increased significantly when video assets were used online and on-air.
| Budget Shift | 5% | 10% | 15% |
|---|---|---|---|
| Reach % Change | 1.8 | 2.7 | 2.7 |
| Average Frequency % Change | 2.2 | 5.0 | 7.6 |
| 3+ Reach % Change | 3.4 | 5.5 | 6.2 |
| 6+ Reach % Change | 4.6 | 8.2 | 10.2 |
| Total GRPs % Change | 4.0 | 7.7 | 10.5 |
| CPM % Change | -3.8 | -7.1 | -9.5 |
For audio, Arbitron reports almost 30% of consumers listen to online radio monthly. We see an even larger digital shift in audio between the true online format and mobile formats such as Pandora and iHeart Radio. Pandora reports over 50% of their registered members now consume audio on their platform through a mobile device.
We have several clients, such as Sewell Automotive Companies and Central Market, where we have dedicated 50%-100% of the audio budget to streaming onto a mobile device.
So, as you are considering where to place your video and audio assets, remember the following factors:
- Closely consider how your audience is consuming its video and audio content.
- Take time to understand the differences in delivery and purchasing across these different channels.
- Continue to monitor and test research that shows the appropriate budget allocations.