Ramifications for TV Advertising during the Stay-at-Home Culture

The world has been grappling with COVID-19 for four months, and we are beginning to see clear trend lines emerge from the media and advertising landscape that will have long term implications for the future of television.

As I shared in a previous article, there is a substantial change in TV viewership -- in overall time spent watching programming, but also in how people are spending their time. Using year-over-year comparisons, households have nearly doubled the amount of time spent consuming television content. Given the social distancing measures now firmly in effect for most of the planet, this data point comes as no surprise. We are also seeing exciting innovations coming to television such as the first truly major “direct to digital” movie release this past weekend of Universal’s Trolls sequel. According to Samba TV’s analysis of on-demand viewing over the weekend, the sequel premiered in more than one million homes from Friday to Sunday, more than doubling the entire first week’s viewership of the digital release of Sonic the Hedgehog which had its digital debut on March 31, following just six weeks in theaters.

Changes are everywhere, and, as we begin the second full quarter of the year in a world remade by COVID-19, every marketer and publisher we work with is asking themselves the same question: what are the new rules of engagement with consumers now, and how will they be different as our lives return to a new normal?

When we look at our data, we see two major forces that will impact the next generation of television. First and foremost, the consumer migration away from linear programming to CTV and OTT platforms has advanced from a steady stream to a full stampede. The time spent watching streaming programming is up by nearly 50% from earlier this year. While time spent watching linear television is up, streaming video is gaining disproportionately. An exception to that is time spent watching broadcast and cable news, which tripled during the month of March. However, we don’t see that normalizing at this level after the crisis.

This disproportionate growth in streaming is driving the second major change we are seeing in the market; as many of our clients begin to move more dollars away from linear into CTV and OTT, they are seeing the total reach of their linear TV media shrinking, while frequency is spiking. We measure this closely for every major TV advertiser, because they will have to rethink their television strategies for 2020 and beyond, in ways far more diverse and data-driven than previously planned. 

One clear example of this shift is in the sports arena. With every major event from the NHL, NBA, MLB, Golf and Tennis to the Olympics postponed, we are working with marketers across every segment to map consumer audiences from sports programming to wherever and whenever they now choose to watch video.  

Just as some segments have gone dark, others are leaning in, recognizing the need to remain relevant and connected to their consumers. In looking at the automotive sector in March, what we saw was ad load holding steady for most of the month. Some brands increased spend while others paused to retool their ad strategies before relaunching.

In each of these cases - for the brand that is retooling its messages for COVID-19, the brand that is building affinity and awareness, or the brand that is driving new and existing products in the current environment - the analysis has shown that their audiences have moved in meaningful, and likely permanent ways to CTV and OTT.  

Agencies are also signaling that they believe we have reached a tipping point in the transition out of traditional linear. With tens of millions of consumers shifting their habits during this crisis, and with a perfect storm facing linear TV once we are out (diminished content libraries and postponed live sports), the shift we are seeing now is one we will be navigating together for years to come.

A silver lining out of all this is that families and friends are coming together and bonding over television -- a time-honored tradition many millions of homes are rediscovering -- now with streaming instead of broadcast. As we all come together to better understand the changes we face, I am profoundly moved by the kindness we are showing one another.  

Our teams have scheduled hundreds of “luncheon meetings” with our partners during the past few weeks, checking in to ensure we are providing exactly the data and the support our partners need. In nearly every case, we are met on the other side of a Zoom or Google Meet by a smiling face eager to dig-in and learn together. It has been a humbling experience and one we have all learned from. 

We are grateful for the opportunity to use data to observe first-hand how humans have adapted, and predict how this environment will leave an indelible mark on how we work and collaborate, but also how culture is shaped, informed and entertained. Please let our team know if we can be of any support to you during the weeks ahead.