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Live TV: Prime Opportunity for Advertisers

June 3rd, 2016   ||    by Susan Kuchinskas

General Electrics’ CMO, Linda Boff, recently got marketers’ attention when she said that GE will spend 92 percent of its television advertising budget on live TV programming. In an opinion piece for AdAge, Boff noted the profound changes in media consumption and wrote, “For marketers, those changes have made live media events such as the Super Bowl and Oscars nearly unrivaled opportunities to strike advertising gold.”

Because consumption of broadcast programming is becoming more fragmented, GE focuses on what Boff calls “spoiler-alert programming.” Also known as “appointment TV” or “water cooler programming,” this is the kind of television content that people want to watch live, enjoy with friends, and be able to take part in conversations face-to-face or via social media.

Viewing in Flux

Television is clearly an important part of the advertising ecosystem. Viewing habits are still in flux; the most recent Total Audience Report from Nielsen found that live-television viewing was only slightly down from the previous quarter, while there was an increase in both broadcast-only homes and broadband-only homes, reports Broadcasting & Cable.

Nevertheless, live TV draws in outsized audiences. According to statistics reported by Strategy + Business, for the week of January 4, 2016, the NFL’s AFC wild card playoff game was the most-watched program, with 12.8 million viewers aged 18 to 49. The next most-watched program was the Golden Globe Awards, with 6.9 million viewers. Big Bang Theory was third, with 4.8 million viewers.

Ad Dollars Flow to Live Television

GE is certainly not the only brand making a big play during must-see TV events. Spending on the Super Bowl is legendary and continues to grow year after year. The big four US broadcasters raked in a total of $8.5 billion in ad sales against sports programming, up 35 percent in the last five years, according to Kantar Media as reported by Quartz. Ditto for the Academy Awards, which reached all-time-high prices for thirty-second spots, according to Kantar.

And then, there are the Olympics. NBCUniversal has seen very strong sales for the Rio Olympics, according to MediaPost. It recently crossed the $1 billion mark in ad sales for national broadcast, national cable, and digital platforms, four months ahead of the games.

Live Television Delivers

Here’s an interesting twist: While consumers increasingly take a multiscreen approach to television viewing, they seem most receptive to advertising delivered along with live TV, according to research from Millward Brown reported by Marketing Charts. (This survey of 13,600 multiscreen consumers skewed toward young viewers, at 16 to 45 years old.) Another finding was that live television was the most social, with 63 percent watching with at least one other person. The positive effects of enjoying content with others could increase receptivity to commercials.

In 2015, live programming over-delivered against regularly scheduled prime-time programming by as much as 416 percent among 18- to 49-year-olds in 2015, GE’s Boff noted. And in the UK, Sky’s SkySmart programmatic-buying platform, now available to 25 percent of British households, led to a 33 percent reduction in viewers changing channels when an ad came on, according to trend-spotting firm 12Ahead.

What Programmatic Could Add

New technologies, such as programmatic buying of broadcast spots, will help advertisers increase ad effectiveness even more. Programmatic buying platforms let media agencies buy more targeted commercials. They’ll be able to address ads to households based on the criteria they identify as most important to the brand’s goals.

Both the 2016 Rio Olympics and the 2016 UEFA European Football Championships will draw viewers around the globe. Both are terrific opportunities to allow advertisers to target spots in a variety of ways, including not only demographics but also language, region, and team affiliation.

So far, no plans have been announced to enable programmatic buying for these global, live TV events. Will these be missed opportunities, or will advertisers be able to reach live viewers with personalized messages that truly connect?

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