WRITTEN BYย ALAN WOLK
Source: www.tvrev.com, April 2023
1. ๐ฆ๐๐ฟ๐ฒ๐ฎ๐บ๐ถ๐ป๐ด ๐ฉ๐ถ๐ฒ๐๐ถ๐ป๐ด ๐๐ ๐ช๐ฎ๐ ๐จ๐ฝ, ๐๐๐ ๐ฆ๐๐ฟ๐ฒ๐ฎ๐บ๐ถ๐ป๐ด ๐๐ฑ ๐ฆ๐ฝ๐ฒ๐ป๐ฑ ๐๐ฎ๐ ๐ก๐ผ๐ ๐๐ฒ๐ฝ๐ ๐ฃ๐ฎ๐ฐ๐ฒ.
๐๐๐๐จ๐ค๐ฃ ๐๐๐ฎ: ๐พ๐ค๐ฃ๐ฉ๐๐ญ๐ฉ ๐ข๐๐ฉ๐ฉ๐๐ง๐จ
Most of the inventory currently available on streaming is reruns of old network TV shows and movies. The big advertisers who spend hundreds of millions on image campaigns still see original series on network prime time as a more appropriate venue for their messages. The lack of standardization in just about every aspect of the business does not help, but it is not the main factor. This will change once the ad-supported arms of Netflix, Disney, Max, et al are more robust (figure two to four years) and advertisers view the originals on these SVOD services as the new prime time with FASTs being the new cable.
2. ๐ฆ๐๐ฟ๐ฒ๐ฎ๐บ๐ถ๐ป๐ด ๐๐ผ๐ฒ๐ ๐ก๐ผ๐ ๐ฆ๐ฒ๐ฒ๐บ ๐ง๐ผ ๐๐ฒ ๐๐ ๐ฃ๐ฟ๐ผ๐ณ๐ถ๐๐ฎ๐ฏ๐น๐ฒ ๐๐ ๐๐ถ๐ป๐ฒ๐ฎ๐ฟ.
๐๐๐๐จ๐ค๐ฃ ๐๐๐ฎ: ๐๐ฉ ๐๐๐ฃโ๐ฉ ๐๐.
Linear TV is propped up by the tens of billions of dollars consumers pay in carriage and retrans fees, courtesy of the Cable Act of 1992. I say consumers, because while the MVPDs are technically the ones paying those billions, they pass on the costs to consumers in the form of higher cable bills. There are no carriage and retrans fees in streaming, and as such, streaming will never be as profitable, no matter how high subscription fees and CPMs go. This is not to say it will be unprofitable. Just not as profitable as linear.
3. ๐๐ถ๐ด๐ถ๐๐ฎ๐น ๐ฆ๐๐๐น๐ฒ ๐ง๐ฎ๐ฟ๐ด๐ฒ๐๐ฒ๐ฑ ๐๐ฑ๐๐ฒ๐ฟ๐๐ถ๐๐ถ๐ป๐ด ๐ข๐ป ๐ง๐ฉ ๐ฆ๐๐ถ๐น๐น ๐๐ฎ๐๐ปโ๐ ๐ง๐ฎ๐ธ๐ฒ๐ป ๐ข๐ณ๐ณ.
๐๐๐๐จ๐ค๐ฃ ๐๐๐ฎ: ๐ฝ๐๐ ๐๐ง๐๐ฃ๐๐จ ๐๐ค๐ฃโ๐ฉ ๐ฌ๐๐ฃ๐ฉ ๐๐ฉ.
Using all that data to target specific audiences on TV is a great move for DTC brands and certain types of retailers. Unfortunately those brands donโt represent a huge portion of total TV ad spend. The brands that do spend hundreds of millions on TV each year generally have no interest in targeted advertising. As they see it, their audience is everyone with a mouth, everyone with an ear, everyone with a driver’s license. They run big budget awareness campaigns on TV to get reach. If someone outside of their desired target sees their ads, they donโt view that as a bad thing as that person may help reinforce a purchase decision. Yes, they will sometimes spend money on targeted campaigns to support a specific initiative, but it will not be the bulk of their ad spend. And as TV data becomes more sophisticated, they will make much greater use of it to track effectiveness and impact, but the big spenders will always want massive reach.
