Sensory Media Allocation = Video Deprivation

At Grey like every other agency we believed in the power of television because of the Sight Sound and Motion notion It seemed obvious that attention and emotions are much more easily captivated when both eyes and ears are engaged rather than just one or the otherI estimate that until around 1989 the year Timothy BernersLee launched the World Wide Web we big agencies spent around 58 of our clientsamp8217 money in TV about 27 in Sightonly media Print and Outdoor and the remaining 15 or so in the Soundonly medium of Radio Iamp8217m hoping Ed Papazian will sharpen that estimate in an appended commentAs I was writing my December 10 postamp160my mind connected some dots it had never connected before and I observed how most of the money in Digital today is Sightonly ie display ads This kind of surprised me given that Digital Video has now been available for well over a decade and appears compared to its own prior baseline to be booming today Yet US ad spend in Digital Video is dwarfed by Digital Display 7 to 1 across all SMI productservice categories combined in the period AprilOctober 2020 in which Digital Video is at its record highs in historyThis reflects the biggest advertisers the ones that use the major holding company and largest independent media agencies My estimates for 1989 above cover the same major advertiseragency universe Here are the data for all productservice categories combinedAnother view is presented by the following bar chart Note how the two Digital Video slices in the middle which you have to really peer at to even see do not grow even slightly for a very long time and then very recently start to grow but very slowly and more at the expense of TV than at the expense of Digital Display which strangely still continues to grow far more than the Digital Video typesHere39s what James Fennessy CEO of Standard Media Index SMI has to say about it amp8220Our data shows video advertising to be underutilized specifically premium video where streaming options can provide strong ROI to marketers While ad spend on OTT has shown some growth of late it is still a very small share of total investmentamp8221I agree CPM is the probable reason for it CPM without regard to ROIHere are my own estimates based on PwC SMI and other sources when we lay side by side todayamp8217s Sensory Media Allocation here is what we seeMy question to all of us is do we now all believe that what we were taught about Sight Sound and Motion was a mistake and we now all believe that static smallspace printtype ads on screens are the equal of Sight Sound and Motion or did this pattern sneak up on us and maybe should be questioned as to maximum cost effectivenessAgain the pattern has all the earmarks of being the result of fixation on low CPMs with blinders on as regards all other considerationsWhat are those other considerations then ROI is one healthy consideration especially because it automatically integrates CPM If a media type has high enough CPM its ROI will not look good even if it has more upward sales impact So ROI already covers all your concerns about CPM plus it values sales more than impressions which is good thinkingFrom an ROI point of view the BHC FOX SMI study shows that premium Digital Video has the highest ROAS TV is second nonpremium Digital Video is third and Digital Display is fourthranked in ROASHowever unless you use random control trials such as the ARF is offering with Central Control BHC and 605 we know that measurers and modelers of ROI often appear to be getting different answers So not content to rely on one study alone I asked my friend Leslie Wood Chief Research Officer of NCSolutions for the latest ROI metaanalysis norms by media type based on over a thousand studies mostly focused on CPG I find the results extremely interesting and I think you will tooLeslie Wood comments amp8220The price of media is a central component to measuring return on advertising spend ROAS and the impact varies greatly across media This means that in the advertising world both supply and demand ultimately drive costs Print has a secondary readership or passalong readership that is often not considered in the cost of the media by some marketers and this increases the number of consumers exposed to the advertising Connected TV is more expensive but might reach a more desirable audience segment for a given brand The ROAS metric is one of many factors used to measure overall campaign effectivenessamp8221Both the national time series BHC study and the single source NCS study vastly different methods agree that within the field of choices we have been discussing TV premium and nonpremium Digital Video and Digital Display 1 TV definitely is near the top and 2 Digital Display is half the ROI of TVWhat about Digital Video Well the jury is still out because SMI is able to break records out by premium vs nonpremium Digital Video and the BHC study finds premium Digital Video higher than TV and so might NCS if they did that recategorizing If the BHC study lumped premium and nonpremium together we might come up with similar number to NCS because frankly the nonpremium ROIs were so low and a larger weight of ad spend that they would probably lower the average for all Digital Video to be in line with this NCS chartWhat I find especially interesting is that Print comes up a hair over TV Earlier studies going back to the famous MPA matched market tests showed the two media having equal impact and synergy together Those print ads were just one sense Sight but in the field of major magazines the ads tended to be fullpage fourcolor bleed powerful gorgeous and arresting The context of reading a magazine tends to be leisurely and relaxed and the audience is in total control unlike electronic media which maintains considerable control over timing etcThat same sense Sight in the context of digital in which the audience wants to be in total control and is subconsciously put off by the fact that the medium has a lot of control using small space ads that magazines run only in the back of the book and not for the major advertisers has a completely depleted effect compared to consumer magazinesConclusion Based on the evidence at hand TV should not be losing share to Digital Display and yet it is I propose that the TV networks pay the cost of the ARF RCT21 for as many advertisers who want a free test and then weamp8217ll all knowClick the social buttons above or below to share this content with your friends and colleaguesThe opinions and points of view expressed in this content are exclusively the views of the author andor subjects and do not necessarily represent the views of MediaVillagecomMyersBizNet Inc management or associated writers

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Sensory Media Allocation = Video Deprivation

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Bill Harvey

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