Television Ads Evolve to Face New Challenges, Formats and Online Competitors

Many consumers are dropping their costly cable and satellite TV subscriptions and relying heavily on internet-based streaming instead. These consumers are called “cord cutters.” This trend creates significant challenges for cable/satellite firms and broadcast television, along with the advertisers that pay for ads on these traditional TV platforms. The fact that new TV sets are internet-ready is adding fuel to this trend.

More and more, consumers are relying on non-TV sources (streaming online) for entertainment, such as Netflix, Hulu and Amazon Prime. These streaming platforms invest billions of dollars yearly in original entertainment content, and they are extremely adept at strategies that let them earn revenues from consumer subscriptions and advertising fees at the same time.

Data analysis tools from firms such as Nielsen Holdings can help advertisers target audiences and save costs in the process. As more data is collected and thoroughly analyzed, media companies can isolate very specific buying groups such as high-income business travelers or female gamers and pinpoint the shows that they have watched in the past.

Advertisers and networks alike are creating new ways to present advertisements and keep viewers engaged. Among the panoply of interesting strategies are new takes on product placement and sponsorship, mini-movies and situational commercials.

Advertisers are experimenting with different types of product placement on television, ranging from the visual placement used in the example above, in which the product merely appears on a show, to more complex (and expensive) types of product placement, such as spoken/verbal product placement, in which an actor mentions the product by name, or usage product placement, in which the actor directly engages with it.

Some advertisers are blending their strategies by placing traditional ads for brand recognition and targeted ads to promote specific products. They are also blending traditional media with streaming and digital media into their ad budgets. Traditional sports and news outlets still deliver powerful audiences, although they face significant competition from digital-only outlets.

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Television Ads Evolve to Face New Challenges, Formats and Online Competitors, Business and Industry Trends Analysis

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