Please wait while the search results are loading...

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

Many consumers are dropping their costly cable and satellite TV subscriptions and relying heavily on internet-based streaming instead, particularly in the U.S.  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 for entertainment, such as Netflix and Amazon Prime.  All internet-based entertainment platforms may come under some pressure to sell advertising, regardless of whether or not they also receive subscription payments.  As content owners, such as TV show producers and movie producers, see the online audiences grow, they will have additional leverage to ask for ever-larger payments for their content.  This could create situations where the online platforms have to weigh the pros and cons of selling ads, increasing subscription fees, or both.
The world’s largest advertisers are reallocating a major portion of spending from TV ads to online ads.  Concerns about audience size, the amount of time spent viewing TV, as well as the amount of attention paid to commercials continue to nag the television industry.  Viewing-on-demand is another issue.  Many television viewers skip at least some ads by channel surfing during commercial breaks.  The network television business model is facing a need for radical change.  Network scheduling, once an all-important strategy for attracting and keeping viewers, has lost its power since people are recording their favorite shows to watch whenever they want via DVRs such as TiVo.
Advertisers are increasingly making use of audience measurement to determine which ads are being watched and which are skipped.  Nielsen Media Research has been providing formal ratings for commercial breaks since 2007.  Today’s set-top monitors measure average viewership for all the national commercial minutes that run during a televised program (individual ads or specific commercial time slots are not tracked).  Audience ratings giant Nielsen has evolved its system to include TV viewership on smartphones, tablets and other wireless devices, on personal computers and time-shifted viewing via DVRs, as well as traditional TV viewing.  Measurement also includes whether viewers channel surf during commercials or fast-forward through them using a DVR.  Millions of set-top boxes for satellite and cable TV subscribers are deemed “household accessible” or “household addressable,” meaning that advertisers can use them to target ads based on viewing habits.  Tracking streaming ad viewing is more challenging since ads appear on multiple apps.
Another challenge to traditional 30-second television ads on network TV is the proliferation of cable channels.  There are hundreds of nationally delivered cable channels in the U.S. alone.  Although many of these channels are limited in scope, budget and audience, many advertisers are starting to see the appeal of niche cable as a targeted advertising medium.  Channels with very specific content can be a real marketing opportunity for certain kinds of advertising.  Their audiences tend to be consistent, representing particular interests and spending habits.  A marketer targeting a niche market may simply look through a cable channel guide and find an appropriate channel.  If you want to sell historic memorabilia, advertise on a history channel, and so on.  Cable’s ability to deliver highly targeted audiences has appeal for many advertisers, and this appeal has translated into cable’s increasing share in the market for television ad placements.  Excellent examples are the huge successes scored by food channels and home remodeling channels.
New data analysis tools from firms such as Nielsen Holdings NV 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.
To a growing extent, many viewers, particularly those in younger demographics, watch video that is “over the top,” meaning it is broadcast via the internet.  A surge in digital video advertising is occurring on sites such as YouTube, Facebook and Hulu.  These platforms are increasing available ad space and attracting advertisers with their growing user bases throughout the U.S.
Some advertisers are blending their strategies by placing traditional ads for brand recognition and targeted ads to promote specific products.  Targeted ads are significantly more expensive per view than traditional ads.
Broadcast companies such as CBS, Fox and Viacom are working to partner with pay TV providers to make targeted ads available in select markets.  It may become common for traditional TV advertisers to broadcast ads for different products to different households based on demographics and consumer behavior.

A Representative List of Organizations that Have Used our Research and Products:


I’m amazed at how much information is available and the various ways to access it. This will be a major resource for our serious job seekers.

Career Services, Penn State University

Plunkett Research Online provides a great ‘one stop shop’ for us to quickly come up to speed on major industries. It provides us with an overall analysis of the market, key statistics, and overviews of the major players in the industry in an online service that is fast, easy to navigate, and reliable.

Wendy Stotts, Manager, Carlson Companies

I really appreciate the depth you were able to get to so quickly (for our project). The team has looked through the material and are very happy with the data you pulled together.

Hilton Worldwide, Marketing Manager

We are especially trying to push Plunkett since all of our students have to do so much industry research and your interface is so easy to use.

Library Services, St. John’s College

We are especially trying to push Plunkett’s since all of our students have to do so much industry research and your interface is so easy to use.

Gary White, Business Materials Selector, Penn State University

Your tool is very comprehensive and immensely useful. The vertical marketing tool is very helpful, for it assists us in that venue, as well as targeting customers’ competition for new sales…The comprehensive material is absolutely fabulous. I am very impressed, I have to say!

Tammy Dalton, National Account Manager, MCI

The more I get into the database, the happier I am that we’ll have it–REALLY happy!!! Between the quality and affordability of your product, its appeal to and value for our users, and the inestimably ethical and loyalty-guaranteeing conduct of your business, I will always have more than sufficient praises to sing for Plunkett Research.

Michael Oppenheim, Collections & Reference Services, UCLA

Plunkett Research Online is an excellent resource…the database contains a wealth of useful data on sectors and companies, which is easy to search and well presented. Help and advice on how to conduct, export and save searches is available at all stages.

Penny Crossland, Editor, VIP Magazine
Real Time Web Analytics