Commentary
Could Advanced TV Advertising Be A $100B Business?
- by Wayne Friedman , Staff Writer, July 14, 2017
Think the linear TV advertising market could rise 50% -- in a few years? How about 100%?
Given the state of digital media, all this seems to be a counter-initiative.
But one media analyst says advanced TV advertising could be a $100 billion business. This would be higher than the …
Wayne Friedman is West Coast Editor of MediaPost. You can reach Wayne at wayne@mediapost.com.
This is a fine theory but the basic truth about "linear TV" across all dayparts and network/station types is that people who are less desirable from a maketing standpoint for most advertisers ( low brows and oldsters ) do much more TV viewing than those who are usually deemed the most desirable---people in the affluent or near affluent category who are under the age of 50 or 55.So, if one were to index all TV shows based on their viewers being frequent buyers of most products or services, about 10-20% of all TV shows might index meaningfully abve average, while 40-50% would probably come in below par. This is not to say that the latter viewers have no value,just less value.
If better targeting focused only on those shows that indexed above average for most advertisers it would soon become apparent that there simply aren't enough "good" TV shows around to fuel an industry-wide ipsurge in CPMs attributed to sellers charging more for their most "valuable" audiences. Some advertisers might benefit as well as some sellers---but not all or even most of them. Meanwhile, most sellers would continue to bundle all of their shows into discounted packages and most advertisers would continue to buy these packages, because they would get more valuable consumer impressions per dollar than way than by trying to cherry pick seller program schedules while meeting stiff resistance or being forced to pay huge CPM premiums for that option---even if offered.