What Manufacturers Can Learn From The Impending Death of Television

In a recent article, Shelly Palmer investigated the idea that television maybe at the end of its lifecycle.  There are many factors he contributes to its downfall but the one shift that is driving the notion is, wait for it ... money, namely advertisers’ money.  He cites a shift from the four major networks (NBC, ABC, CBS and Fox) to the “new four major networks, namely Facebook, Amazon, Netflix and Google/YouTube (or as he calls them FANG).

Here are some of the highlights from his explanation:

Because the broadcast television industry is data poor (it only offers metrics about itself), this model has never been a complete solution for brand or lifestyle advertisers.

For today — advertisers are spending, traditional networks are making money and all of this sounds like stuff you’ve heard before. But we’re only talking about timing.

For advertisers — Brands have never wanted to buy CPMs (cost per thousand impressions) or GRPs (gross rating points); they want to sell stuff. The data-rich FANG and other tech giants are offering data that can be turned directly into sales.

For Networks — It’s just a matter of time before media without actionable data will be impossible to monetize. Can traditional TV catch up? Adapt or die!

Traditional (linear) TV audiences are declining at a significant rate, and they are practically aged out of key demographics.

So what does that mean for our industry?  Well, it means A LOT. In fact it means everything if you are a manufacturer that has continued to advertise the same way you did in 1995, 1985, and beyond.  Times are different and EVERYTHING changes.  While the pace of evolution in this market seems glacial at times, it is happening.

Display advertising was never meant to be the complete solution or ultimate solution, although it was the best option thirty years ago.  In today’s B2B climate, it’s important to note that making advertising placements with partners who offer very little data beyond itself (i.e. circulation data etc.) is outdated and very close to being phased out just as it is in main stream TV advertising.

Think KPI (key performance indicators) vs. CPM and you may better understand where we are as a market.  You as an advertiser and manufacturer need actionable data. Examples might be knowing what your target audience likes to consume; what their passions are; what they buy and/or; what they are paying attention to. All are essential data points so that a direct link to your KPIs is known, clearly outlined and documented.  It’s the quintessential difference between being “data rich” vs “data poor” and it’s vital you establish your company on the wealthier side of that data class war.  Take note, the revolution has begun to kill American television and will not stop there as ALL consumers, both B2C and B2B, forever change the way they absorb content.  Are you late to the party? Yes.  Is it too late? No but it’s getting awfully close to midnight.  In the words of Walter Cronkite, “And that’s the way it is.”