Over the last decade, the media market has undergone a substantial change, which has resulted in a shift in ad investments between individual media types. In 2010, most ad investments went to TV and the press. Digital advertising was still in its infancy but it got a larger share every year. Nowadays, it accounts for two thirds of online and TV ad investments.
Yes, after ten years of substantial changes in the media and consumer behaviour, TV is still keeping the position of one of the two strongest media types on the market. During the year, the ad space on TV stations is sold out nearly all the time, hundreds of firms invest in TV advertising every year and the share of investments has long been stable. Internet advertising has grown faster in the last ten years, principally to the detriment of the press, which has lost its position of the second largest media type.
TV - number one in brand building
Long-term brand building, high return on investment and the opportunity to address millions of potential customers are the key reasons why firms still invest in TV ads large amounts of money after ten years of substantial development of the internet. On average, nearly three quarters of TV viewers switch on their TV sets every day and spend an average of three and a half hours watching TV. (Source: ATO –- Nielsen Admosphere, live+ TS0–3, 2010–2020, Reach / day, ATS / day, TG 4+) They watch TV ads predominantly on the largest screens in their homes. According to a number of surveys, TV ads raise the most emotions compared to other types of advertising and their recall is much longer. According to the research by professor Karen Nelson-Field, people remember a TV ad for up to 109 days after having seen it while online ads are often forgotten after several days. (Source: Karen Nelson-Field, Centre for Amplified Intelligence, The Benchmark Series, 2019)
All of these attributes make TV advertising an ideal tool, predominantly if a firm wants to introduce a new product to the market, increase its brand awareness and build it in the long term. An average TV campaign on Czech TV stations addresses 58% of the TV population, which is more than five and a half million viewers, i.e. potential customers. (Source: ATO –- Nielsen Admosphere, live + TS0–3, 2020, 30s block TRP, Reach, Reach 000, TG 4+, average campaign: 212 30s block TRP) In connection with the development of the TV market in the last decade, TV advertisers got an opportunity to target more effectively as, for example, thematic TV stations focus on the interests and preferences of their viewers.
Food retailers, FMCG companies and lately also e-commerce businesses
Hundreds of companies investing in TV advertising every year have been aware of the advantage of TV advertising. The truth is that this marketing tool is used principally by big companies, although recently, TV has also been open to smaller businesses that need to make themselves known. While ten years ago, spots of the TOP 20 TV advertisers covered half of the ad space, today they account for a third. (Source: ATO –- Nielsen Admosphere, live + TS0–3, 2010, 2020, 30s block TRP, TG 4+, Atmedia analysis)
The list of the largest TV advertisers has substantially changed over the last ten years, reflecting the changes in society and economy to some extent. Ten years ago, the largest TV advertisers usually included just the global FMCG companies while today, the list of top advertisers is much diverse. The top positions are taken predominantly by food retailers and FMCG companies, but the largest players also include pharma companies, betting offices and e-commerce businesses.
Namely the substantial increase in TV ad investments by DTC companies shows that TV ads are also needed for the growth of data-driven digital-native companies. Investments in TV advertising by companies such as Alza.cz, Mall.cz, AboutYou, Zalando or Zonky have increased by hundreds of percent over the last decade. After the changes brought about by the global pandemic in 2020, e-commerce companies will take the top places among TV advertisers even more frequently.
Demand for VOD services and addressable advertising will grow
Over the last ten years, TV has proven that it can address viewers even in the era of the internet and social networks. It has also been a relevant and indispensable part of brands’ media mix. Does this mean that TV will keep the position in the following years? I believe so. On condition of continuous adjustments to the changes on the media market and responding to advertisers’ requirements. The development in other markets, mainly in Western Europe, shows the direction TV players will take in the following years.
First of all, they will have to respond to the gradual decline in the number of younger viewers. Their response will include their own VOD services and TV content offered on various platforms. TV companies will allow individual brands to address potential customers not only through linear TV but also through ad messages in VOD applications or internet archives - simply wherever their target group is. This also relates to another big challenge for the TV market because new opportunities for watching TV content, elimination of the difference between individual platforms, and connection of TV and the internet open the way to addressable advertising. The key advantage of TV advertising, i.e. the massive viewer reach, will remain but advertisers will have a new opportunity to target more precisely as they do on the internet.