The past 13 months remind me of the cargo ship "Ever Given" that grounded in the Suez Canal. Before the pandemic, the industry was stuck, too—following legacy business practices and trading principles. Then, like the cargo vessel's rescue, the pandemic dislodged the media business, forcing it to refocus and address critical issues around business models, alignment, data and technology. The result? We have accomplished more in the last year than the past five years.
Major holding companies such as WPP and Omnicom announced significant organizational changes to modernize data operations and refine go-to market strategies for the greater good of their clients and the industry. NBCUniversal further united data with technology through its “Audience Insights Hub,” Verizon Media partnered with Catalina for its individual shopper card data and streaming giant Roku acquired assets from Nielsen that will drastically expand its capabilities in the linear addressable, OTT and overall data infused media market.
These companies are not alone in their progression, and the industry should consider three strategic variables as they continue to improve and evolve their businesses in this new marketplace.
The demise of linear TV or its value to advertisers is greatly exaggerated
The growth in on-demand content via OTT distribution will not spell the end. A shift in distribution of content does not necessarily change how TV is consumed, only how it is received and accessed. Just look at the successful launch of Discovery+. Linear TV is now becoming one with OTT, and while all consumers might not watch “Fixer Upper” or “Mythbusters” on the same Discovery stream or channel, they are all, in fact, watching Discovery programming.
Top content from HGTV, Food and other popular Discovery networks will continue to exist on linear cable in addition to Discovery+, which is now on pace to surpass 12 million subscribers, according to Chairman and CEO David Zaslav. This is TV evolution at its best.
Navigating these environments is not easy, due largely to the absence of true omni-channel measurement. Changing consumer behavior is inevitable, but the pandemic has demonstrated how quickly these shifts happen. We have seen the industry adapt to these changes and distribute content in new ways. But the bridge between truly understanding these behaviors and the ability to adapt with them requires an understanding of who is watching what and how. Distribution channels will continue to fragment—therefore the industry must adapt a solution suitable to modern viewing in order to maintain the proper balance of trade.
Take advantage of the willingness to partner and collaborate—while you can
Collaboration between competitors in the interest of advancing the business is not unusual when economic and societal circumstances force a closer alignment of goals and less focus on self-interest. How long this unified interest lasts will depend heavily on economics but also an individual company's appetite to focus on “the business” and not just “my business.”
Accountability is relevant to all in our business and should no longer be considered nice to have, but rather a requirement especially when it relates to the use of data and technology. One could argue it is irresponsible not to use everything in our power to deliver on what is possible. Now is the time for all parties to align on that principle for the greater good of the industry.
There is no better time to invest in compatible, interoperable automation in TV
It is unlikely that the TV/video business will ever evolve fully to a digital programmatic transactional process given its unique market dynamics. However, there is no avoiding the need for a platform-based solution to harness data and insights and to manage inventory from both sides of the table. We all long for addressability, but often forget that the division of a spot or unit requires a method for filling the gaps. The economic model to make addressability viable is as critical as the technology to implement it in order to achieve “real” market penetration and scale. It is also understood that addressability requires data, that data must be people-based to remain consistent with the current marketplace and that a transaction must be easy for all parties to engage. Solve this and we will see an increase in overall investment, greater efficiency, marketplace alignment and an influx of new advertisers to data and technology-driven television/video.
If there were a single baseline for all that has happened over the past year, I would simply characterize it as people have had time to evaluate, prioritize, think and evolve. Our industry has always been guilty of being slow to change without a blunt force to push us. Like the "Ever Given," our business needs to navigate from one port to another as quickly as possible while finding new ways to upgrade the ship and properly consider all possible routes at the same time. Just as many of us used this time to rebuild, rethink and reprocess our part of the economic media engine, we should be moving forward and refine and rebalance the industry we know and love.