Tag Archive: covid-19

  1. Why now is the right time for an intensive marketing campaign

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    The coronavirus pandemic has wreaked havoc on economies across the world, forcing consumers inside and closing down huge swathes of society and business, including retail, hospitality and travel. The advertising industry has been hit hard, with many brands having to pull or adapt their marketing campaigns and slash their budgets. However, many countries are starting to show signs of recovery, while media prices are still down. Could this be the perfect time for advertisers to reassert themselves?

    Media pricing is low

    As we reported in the special coronavirus update to our inflation report, the forced changes in consumer behaviour during the lockdown led to significant changes in media pricing. OOH, Print and Radio were more obvious victims, suffering significant deflation globally; however, TV also became deflationary thanks to increased eyeballs teamed with many brands pausing their activity. Even Digital inflation was lower than forecast at the beginning of the year: high demand led to overall inflation, but several major markets saw deflation in digital channels due to huge inventory increases combined with decreased demand. The result? Huge savings to be made for advertisers who continue their marketing campaigns.

    As countries emerge from lockdown, signs of economic recovery are encouraging

    Over the last few weeks, countries around the world have started to emerge from lockdown, with the retail, hospitality and travel sectors being opened up, albeit with restrictions in place. Governments are providing stimuli to kick-start spending, and there are indications that these measures are working. Italy saw a 24% surge in retail sales after lockdown lifted, while retail sales in both Germany and the Netherlands in May rose above pre-pandemic levels.

    Promising signs from China

    There are also promising signs from markets who are further along the coronavirus ‘curve’, particularly China. The Chinese economy continues to recover after the government lifted strict lockdown measures and ramped up investment. Four data points in particular show encouraging signs that this key market is recovering: the services PMI jumped to 58.4 in June, from 55.0 in May, which points towards rapid month-on-month recovery; nonmanufacturing activity jumped to a seven-month high in June; the official manufacturing PMI reached a three-month high, and manufacturing activity reached a six-month high. These indicators have raised hopes that China will make a full recovery later this year. Of course, the ramifications are felt across the world: Wall Street stocks rose sharply on 6th July as positive sentiment from China allowed investors to hope that the Chinese recovery would drive demand for foreign goods.

    Hope for a single-hit scenario

    The OECD has made predictions for global economic recovery based on two scenarios. The first is a double-hit scenario which would see a second wave of infections before the end of the year. The second would see the second wave of infections avoided. Given economic and industrial indicators, and with continued controls in place, we should be cautiously hopeful that the latter scenario will be the case.

    The time to restart your advertising is now

    Brands should take hope from the Chinese recovery. In markets where the pandemic has been largely well managed, there is light at the end of the tunnel. Although the pandemic has caused huge suffering both personally and economically, many people who have not lost their jobs have saved a significant amount of money as they have not been able to travel, eat out or go shopping. Furthermore, it’s likely that many of them will be eager to spend the money they’ve saved following months of boredom at home. Teamed with the fact that media pricing is so low, now is a great time for advertisers to invest in an intensive marketing campaign so that their brands are top of mind as consumers start spending again. There will undoubtedly be a first-mover advantage for brands seeking to increase their share of voice, and to obtain the best value media pricing.

    Look out for ECI Media Management’s upcoming whitepaper on how to harness reduced media pricing and ensure that you capitalize on the deals to be had. At ECI Media Management, we can help you to navigate the rapidly changing media landscape so you can drive higher media value. Contact us to discover how:

    Image: Olivier Le Moal / Shutterstock

  2. The Facebook boycott: what are the implications for brands and for Facebook itself?

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    Facebook has faced significant challenges over the last few years, notably since 2016, which saw the tech giant embroiled in controversies relating to the election of President Trump in the US, and to the UK’s Brexit referendum. 2020 is not proving to be any easier.

    The world’s largest brands boycott the world’s largest social media platform

    The current controversy was sparked when President Trump reacted to the Black Lives Matters demonstrations in a post on Twitter and Facebook, which he ended with the phrase ‘when the looting starts, the shooting starts’. Twitter reacted by hiding the post behind a warning that it ‘glorified violence’; Facebook, on the other hand, did nothing, with Zuckerberg saying that it was “better to have this discussion out in the open”.

    Shortly after this debate, a consortium of civil rights groups started urging advertisers to reduce or even halt their spending on Facebook throughout July, under the #StopHateForProfit hashtag. The campaign gathered momentum, peaking with Unilever’s announcement last Friday (June 26th) that they would cease all their US advertising on Facebook until the end of the year. Within two hours of the announcement, Mark Zuckerberg released plans to prohibit hate speech ads and to better protect groups such as immigrants on Facebook. He also said that the platform, undoubtedly with one eye on President Trump, would label posts that violate their policies but need to remain published ‘in the public interest’.

    Facebook’s changes weren’t enough

    But Zuckerberg’s pledges weren’t sufficient to stem the flow: over the weekend and into the beginning of this week, more and more brands announced they would be joining the boycott. Facebook is now facing the loss, at least temporarily, of income from 150 brands as large as Verizon, Starbucks, Adidas, Coca-Cola and Honda – as well as Unilever of course. To give an idea of the amount of money this means, Unilever and Verizon spent $850,000 and $504,000 respectively on Facebook in the first three weeks of June alone. The World Federation of Advertisers claims that a third of the world’s biggest brands will, or are likely to, suspend advertising on social media, while an additional 40% are undecided.

    What are the implications for Facebook?

    The loss of income because of the boycott will undoubtedly be a real blow for Facebook – but by no means a fatal one. The majority of its income comes from the longtail: eight million small and medium-sized companies who are priced out of TV and therefore can’t afford not to advertise on Facebook. However, Facebook’s share price was affected by the boycott, down by 10% to $212.50 over the course of the week to June 28th. They have no choice but to closely consider their next steps, particularly ahead of what is sure to be a contentious presidential election in November.

    The Facebook boycott was catalysed by the Black Lives Matter movement, but came amid a context of haphazard policing of the site. Facebook’s stance on hate speech has long been less clear than its position on other controversial content such as nudity; this is partly because it believes that it shouldn’t be responsible for this content, and partly because it’s so much more difficult to automate this work. It has made significant progress in this area: according to its Community Standards Report, in 2017, Facebook identified just 25% of hate speech removed from the platform itself, relying on users to flag the other 75%. By the spring of this year, however, 88% of the hate speech removed was found with its own tools, meaning it could remove or restrict four times as much as it had two years earlier.

    Facebook, and many of the other social media companies, continue to maintain that they are tech platforms, not media platforms, with the limited responsibility for content that that status implies. However, in introducing measures such as those described above, they are arguably de facto admitting that they are publishers and therefore have a duty to ensure that their content abides by local and international laws.

    What is motivating brands to boycott Facebook?

    Facebook has long been a key advertising platform for brands, giving them access to billions of users across the planet. Boycotting the company as part of the #StopHateForProfit campaign is a very sound PR move, and a great example of the world’s largest corporations using their power for good – in this case, holding social media companies to account. Advertising budgets for many brands, especially travel and consumer goods brands, are shrinking as the world faces an almost certain recession following the coronavirus pandemic. They will be seeking to make cuts and the #StopHateForProfit campaign may have presented an opportune moment to start making those cuts whilst simultaneously spurring change. What’s more, media cost deflation for most traditional media types and lower-than-expected inflation for digital channels mean that advertisers may feel they are in a strong position regarding where they place their advertising spend, allowing them to boycott a previously key channel. However, it’s important to remember that, while this move by advertisers may have been partially instigated by the fall-out from Covid-19 crisis, digital is a key channel and has become even more so during the pandemic as billions seek entertainment and information at home – this is a big move. Some brands will also undoubtedly use their break from the platform to evaluate the impact that Facebook activity has on their marketing results. In short, the move by marketers to boycott Facebook is both altruistic and strategic: it will be fascinating to see how it pans out.

    Brands have long been uneasy about advertising on Facebook, thanks to historical brand safety issues and because they are worried about contributing to the consolidation of the Facebook-Google duopoly. No matter what the reasons or motivations for the boycott, perhaps now is the time that Facebook will be forced to implement fundamental change to the platform, including allowing marketers to better control where their ads are placed, and making the algorithms that control content more transparent.

    Image: BlueSkyImage / Shutterstock

  3. Will the coronavirus pandemic drive seismic changes to the Upfront market?

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    Coronavirus is a catalyst for changes that have been years in the making. Nowhere is that truer than the advertising industry, which has seen the adoption of new habits which might previously have taken years happen in a matter of weeks.  

    When and how will the Upfronts occur this year?

    One key area of change for the US market is the TV Upfront ecosystem. With production grinding to a halt and much of the country still in lockdown when Upfronts were meant to kick off, the question is, when and how will the Upfronts occur this year? Many key industry players have long pushed for the Upfronts to switch to a calendar year model, rather than the broadcast year of October to September. At the end of May, the ANA Media Advisory Board recommended a sweeping transformation of the system, causing a huge shake up in the media world. But how will it all pan out? 

    TV has transformed dramatically

    Few would argue that TV’s OctobertoSeptember timeframe is outdated. It harks back to a time when TV was mainly appointment viewing, with a set year-round schedule of shows having first runs from October to May, with reruns over the summer. This in turn is rooted in historic business movements: car companies used to unveil new vehicle models in the fall, so TV launched its new season to tie in with thatBut the TV sector has transformed dramatically in recent years: the proliferation of channels and programming means new content is available throughout the year. What’s more, appointment viewing has dissolved with the growth of time-shifted viewing, on-demand, OTT and CTV platforms; Nielsen found that the streaming share of TV is now at 23%, up from 14% compared to the same period a year before, and is expected to continue its growth trajectory. 

    Allowing for a better understanding of budgets

    The suggested shift to a calendar-year model would allow advertisers until Q4 to get a good understanding of their budgets for the following year – especially important this year when all industries have experienced so much disruption. However, many of the large, traditional advertisers are set on signing upfront deals under the traditional broadcast-year model; even if the networks do choose to shift to the calendar year model, it would be easy to put aside the inventory that the big players normally go for, leaving newer advertisers with the ‘leftovers’ in the calendar-year marketplace or the more expensive scatter market. 

    The absence of live sports

    Another compelling reason to push back the Upfronts is the current absence of live sports, and how the ‘withdrawal’ that many viewers and advertisers have felt will affect viewership when they are finally allowed to play again. The fact that games will be played ‘behind closed doors’ means that TV audiences are likely to be through the roof; it will be very difficult to estimate prices for ad spots until networks have a better idea of what those audiences will look like. In that light, shifting the Upfronts to Q4 seems like the right thing to do.  

    A chance to align the Upfronts and Newfronts

    Shifting the Upfronts would present an opportunity to align them with the increasingly important Newfronts – a desirable outcome for both advertisers and media buyers. 72% of media buyers say that Newfronts are more important than ever, and nearly half want the Newfront presentations to merge with the Upfronts. A key factor in this is that 39% favor merging the two to help buyers better understand measurement and research across screens – which could in turn improve performance. There is a finite amount of reach available through linear TV and, in order to expand coverage or just reach the same number of consumers as before, advertisers need to diversify their media mix. 50% of marketers will increase their spend in CTV, OTT and Digital Video, while linear TV is likely to see a decrease. Advertisers will be looking to buy audiences agnostically across a network’s linear and digital assets: a compelling argument for merged Upfronts and Newfronts. 

    The time is now

    All in all, it seems that transforming the Upfronts timeframe to a calendar model makes a lot of sense. It will be uncomfortable for a while, but doing it in a year when the status quo has been disrupted so fundamentally and the landscape has transformed so dramatically anyway seems a good time to do it. Time will inevitably tell. 

    Advertisers should re-evaluate their media mix and KPIs

    Regardless of whether the Upfronts shift to a calendar-year format, or whether they merge with the Newfronts, this is a good time for advertisers to re-evaluate their media mix and KPIs, and to negotiate better deals with vendors.  

    • Buy flexibility: Flexibility has been an increasing priority for advertisers over the last few years, and the fact that so much new programming has been shelved as production is halted means that flexibility is more important than ever. Cognizant of the marketplace, vendors are likely to be more willing to provide more flexibility.  
    • Consider scatter opportunities: Marketplace uncertainty means that Upfront commitments are expected to be much lower than in previous years. This means that there will be more high-quality inventory left over for the scatter market – particularly as there is likely to be more certainty around programming and production as time progresses. 
    • Review your TV/digital mixWith 59% of media buyers expecting to increase their CTV/OTT budgets in the second half of 2020 compared to 2019, wise advertisers will consider where their audiences are, and the best touchpoints. 

    2020 has doubtless been a year of disruption and sleepless nights for advertisers and buyers in the US and worldwide, but with strategic thinking and agility, the transformation to the media landscape can be turned into an opportunity for the savvy advertiser. If you would like to discuss with one of our experts how you can identify and exploit the opportunities, please feel free to contact us on   

    Image: Vasyl Shulga / Shutterstock

  4. What will the ‘new normal’ be for the advertising industry?

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    It won’t be news to you that the coronavirus pandemic has changed how we do marketing in 2020. Consumer behaviour and confidence have been transformed by lockdown restrictions around the world, with digital and TV now the primary media consumed. Many media channels have seen significant changes to pricing inflation forecasts, with digital the only media forecast to see inflation consistently, if at reduced levels compared to forecasts earlier this year. Many other media, particularly the traditional ones, are expected to suffer severe deflation.

    The brands that emerge the most unscathed from this crisis will be the ones that have adapted to the rapidly transforming media landscape – not least because those changes will have lasting repercussions for the advertising industry and marketing as a discipline. Furthermore, many brands will have acquired or honed a new set of skills and mindsets which will help them to succeed in the ‘new normal’.

    More digital than ever

    The principle reason for the resilience of digital media over the last few months is the fundamental change in consumer behaviour. Bored at home and without the diversions of normal everyday life, people have turned to the internet for entertainment. Brands have followed them – but this move makes sense not just because of the increased eyeballs. Digital is also more agile than the traditional media, allowing for swift changes in direction: programmatic means that campaigns can follow impressions. The more traditional media are frequently less flexible, meaning that, at the start of the pandemic at least, many TV and OOH campaigns jarred with the new reality. Brands that previously relied on offline media have had their eyes opened to the opportunities that digital presents.

    Genuine purpose

    The idea of purpose being at the heart of a brand’s marketing strategy isn’t new, but the pandemic has seen a desire for more authentic behaviour from brands. In this time of great hardship for so many, it’s not enough to pretend: brands must be genuinely supportive, whether that’s by offering a service, helping a specific community or simply by providing high quality entertainment. What brands say is less important than how they behave, and they should focus on solutions rather than purely selling. 1 in 3 consumers have punished a brand that has not responded well to the pandemic by persuading others to stop using that brand.

    A new skillset

    The pandemic has forced advertisers and agencies to adapt to a new way of operating, with new skills and mindsets acquired or honed. These skills will serve the entire industry well as we all emerge slowly into a post-coronavirus world, and could be behind an exciting shift.

    The advertising industry hinges on innovation, and never has it been so necessary as now. The coronavirus pandemic has overturned normal ways of working and living, necessitating new ways of reaching and engaging with consumers. AI and chatbots, for example, have been harnessed by many brands who are having to rely on virtual services more than normal – and it appears that consumers are also becoming more comfortable with this way of communicating

    Of course, the ability to innovate and work with the latest technology is born of a willingness to be open to new ideas, and to collaborate closely, despite restrictions on physically working together. Sharp U-turns in strategy and messaging require trust in partners and decisive action. The result is an approach to marketing which centres on testing and learning, rather than caution, and that can only be a good thing in such a fast-changing industry.

    Let the consumer be your guide

    Ultimately, the key to successful marketing has not changed: it is the consumer that should be at the heart of a marketing strategy. Brands and their agencies need to focus on the consumer’s needs and desires as a guiding light, using data to understand exactly what those are. In that way, the post-coronavirus world won’t be very different – but reaching that end point might be.

    Image: Aon Khanisorn / Shutterstock

  5. Why you shouldn’t be afraid of advertising next to coronavirus-related content

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    A dramatic change in media pricing

    In our coronavirus update to our annual Inflation Report, we revealed that an increased supply of inventory, teamed with decreased advertiser spending, will likely lead to dramatic deflation in the cost of traditional media across the world.  Although not as dramatic, digital media are also seeing price drops in EMEA and North America (although they are more buoyant in APAC), as programmatic media adjusts directly to changes in offer and demand. However, there is an additional trend reducing the price drop for digital: the use of programmatic blacklists to block terms associated with coronavirus. A reduced drop in pricing might sound like good news for the digital media industry, but the blacklisting trend is having a dramatic impact on digital publishers.

    Brands are blocking coronavirus-related keywords

    Consumers living in lockdown are turning to digital channels to stay updated on the news and for entertainment – with increased eyeballs, it would seem to be the perfect time for advertisers to build awareness of their brands and their products. But many of them are squeamish about coronavirus-related content, and are turning to keyword blocking as a way of safeguarding their brands from appearing alongside content related to the pandemic – good or bad. Ad verification firm Integral Ad Science estimates that blacklisting during the pandemic has kept more than 1.3 billion ads from appearing next to content featuring the world ‘coronavirus’ – and that doesn’t include other terms such as ‘covid-19’ and ‘pandemic’. Of course, the pandemic has affected every aspect of society – healthcare, of course, but also the economy, work, sport, home life and retail – which means that ‘coronavirus’ appears in almost every news article published. The loss of ad revenue that comes from blocking coronavirus-related keywords is devastating for online publishers, to the extent that the future of many is at risk. This would be a huge blow not just for them, but for the many advertisers for whom appearing alongside high-quality journalism forms an important part of their advertising strategies.

    A nuanced approach will keep your brand safe and allow you to benefit from larger audiences

    A blanket approach to blacklisting is not necessary in this context. The IAB has been working to combat this practice, providing guidance to advertisers around how they can keep their brands safe and avoid embarrassment, whilst still supporting quality journalism and benefiting from the hugely increased and highly engaged audiences. The approach that the IAB recommends is pragmatic, harnessing tools and techniques which allow a multi-faceted, more nuanced approach, for example incorporating semantic and contextual solutions. More sophisticated tools can identify the context of an article: a news story that talks about local heroism or how to juggle working with home schooling will still mention coronavirus, but is a much safer context than a story that talks about the number of deaths in care homes, for example. Indeed, a more nuanced and thought-through approach regarding the selection of ad environments has always been advisable. As with domain lists, it is typically most efficient to focus on defining and selecting desirable environments and partners (whitelists) rather than the undesirable ones (blacklists). Domain and keyword blacklisting should be part of a strategy, rather than a strategy in itself; there is limited value in the longtail of domains in any case.

    Add value for consumers by adapting messaging and creative

    Messaging and creative is also important. A lot of the news right now is bad, but by striking the right tone, ads can add value to the reader’s experience. An appropriate tone could mean being helpful, providing products or services that benefit consumers, not exploiting the situation, offering reassurance or showcasing, with modesty, how you have helped. Global research carried out by by Kantar shows that the vast majority – 92% – of consumers do not expect brands to stop advertising during the pandemic.

    Burger King: getting the balance right

    Burger King is a great example of a brand that is getting the balance right. It rapidly adapted its messaging and creative as the virus spread, focusing on contactless food delivery and pick-up, which means its marketing doesn’t seem out of place in a news cycle that is relentlessly focused on the pandemic and on the lockdown restrictions across the world. As Burger King’s Head of Brand and Communications, Marcelo Pascoa, told The New York Times, ‘It isn’t damaging for the brand to appear within the context of the crisis, because the brand is playing a role’.  Global CMO Fernando Machado, agrees, telling DigiDay, ‘Instead of relying on a block list, I would personally rather have us focus on making sure that whatever we put forward takes into consideration the context and that’s exactly what we did… We’re more relaxed about that because of the content we’re putting forward’. The company’s media strategy also reflects the different situation in each market: with restaurants closed in France, it doesn’t make sense to have TV, so investment has been focused on digital to keep engagement high, while in the US restaurants are still open for drive-through and delivery, so TV is more relevant.

    Larger, more engaged digital audiences

    There is huge value to be gained for brands who are willing to take a more nuanced approach to blacklisting. Digital audiences are much larger and much more engaged than normal, but prices are falling because of decreased demand from industries, such as travel and automotive, struck hardest by the pandemic. Now is a great time for brands who are in a position to spend to grow their share of voice and share of market by making the most of the increased value and appearing alongside quality news content which is attracting huge numbers of eyeballs. Premium placements with trusted news organizations are a great option as they are more likely to appear alongside thoughtful, less alarmist journalism.

    Helping you to successfully navigate a new media landscape

    It’s natural for brands to be more cautious in a global crisis such as this, with so much economic uncertainty making expensive brand safety errors something to be avoided at all costs. But at ECI Media Management we believe that this is an opportunity for those with budget to spend to benefit from increased return on investment. We’ll continue to provide forensic analysis and actionable insights so our clients can successfully navigate a media landscape that has transformed beyond all recognition, and plan their media activity during this crisis and beyond.

    Read and download the Coronavirus Update to our Inflation Report here.

    Discover our top 10 recommendations for advertisers during the coronavirus pandemic here.

    Contact us:

    Image: Anton Veselov/Shutterstock

  6. Coronavirus has a dramatic effect on media inflation

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    In just a few short weeks the Covid-19 pandemic has disrupted the human way of life right across the globe. We have been forced to stay at home and, crucially for the advertising industry, our consumption habits have been transformed quite literally overnight. Many brands have been impacted by reduced spending, forcing them in turn to reduce their own advertising budgets; almost all advertisers have revised their 2020 marketing activity in some way.

    This disruption to global media markets has caused a sharp drop in demand and, as a result, a decrease in pricing for most media types, according to ECI Media Management’s special report on the impact of coronavirus on media inflation, produced by our experts. At a global level, all traditional media types will suffer from deflation of varying severity, while Digital Display and Digital Video – which were looking very robust in our original report released at the beginning of the year – are forecast to be only minimally inflationary in 2020. The story is more varied at a regional level: in North America and EMEA, all media including Digital are deflationary, while in APAC and LATAM some media types are showing more resilience. It seems likely that the fact that these regions are at different stages of the pandemic – APAC is seemingly through the worst, while LATAM looks to be at the start of the curve – is affecting inflation.

    Digital: inflationary overall, but deflationary in key markets

    With advertisers shifting spend out of OOH, demand is high for digital, leading to overall inflation for Digital Video and Digital Display, particularly in APAC which is driving global Digital inflation. However, several major markets such as the US, the UK and France are experiencing deflation in digital channels due to the huge inventory increases combined with decreased demand. The use of programmatic blacklists to block terms associated with coronavirus is reducing the price drop for digital channels, although the trend is causing digital publishers to struggle – the IAB is trying to combat this practice.

    The video streaming platforms should be one of the few sectors to benefit from the coronavirus pandemic, with subscriber and viewing figures up significantly. Those platforms with a revenue model based on advertising should see increased demand from advertisers seeking to benefit from that increased viewership, especially in the US.

    TV: consistently deflationary, except in APAC

    TV viewership has perhaps never been higher, with people turning in their droves to TV as a source of information and entertainment. The increased viewership has led to increased supply, particularly as some advertisers have had to pull their spend – and that has led to an overall deflationary trend. This means that there is huge value for those brands who are still active in TV, with much more reach at no extra cost.

    Coronavirus will have a lasting impact

    Coronavirus and the havoc it is wreaking on our economies and our way of life will have a profound and enduring effect on the entire advertising industry. It seems inevitable that, when we do emerge from this crisis, the landscape will have dramatically transformed. Economic uncertainty and a lack of growth will likely see brands continue to exercise caution over their marketing spend: ad spend is likely to decrease, and media inflation will inevitably respond. At ECI Media Management, we will continue to provide forensic analysis and actionable insights so that advertisers are able to successfully navigate this new terrain. Please don’t hesitate to contact us if you would like to discuss your media activity in a post-coronavirus world.

    Read and download the report here.

    Discover our top 10 recommendations for advertisers during the coronavirus pandemic here.

    Image: Cipariss/Shutterstock

  7. TV in the time of coronavirus

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    Around a third of the world’s population has had their freedom of movement limited to a lesser or greater extent – these restrictions include recommended or mandatory social distancing, school closures and orders to work from home if at all possible. For the billions of people now spending the vast majority of their time at home, TV has become the primary source of entertainment and connection with the outside world. It is a trusted source of information and distraction, and even acts a social glue: it’s one of few things that we still have in common that isn’t the battle against the covid-19.

    TV is an industry that has seen huge change over the last few years: the pandemic will accelerate that change and, in some cases, even reshape it.

    People are watching more TV than ever

    It’s no surprise that TV viewing figures across the world have increased dramatically over the last few months. In the two-week period to March 29th, overall usage of TV among viewers aged 18-49 in the US increased by 25% year on year, compared to the same period in 2019. Streaming video on demand (SVOD) services have enjoyed similar gains: Netflix subscriptions are reportedly up 27%, Hulu’s are up 16% and Amazon’s 21% (according to NBC). In the UK, TV viewing grew by 17% year on year in the week commencing March 16th – and that was a week before lockdown restrictions were implemented. Meanwhile, Statista found that 43% of US adults are now more likely to watch movies from a streaming service, while 40% of adults are more likely to watch TV online.

    Primetime has shifted earlier as viewers turn to TV to alleviate boredom throughout the day. According to Conviva, daytime viewing jumped by nearly 40% in the week of 17th-23rd March, versus the week of 3rd to 9th March.

    A profound effect on advertisers

    Of course, the impact of coronavirus on brands has been profound: many are seeing decreased sales with customers unable to leave the house, and with financial concerns of their own affecting purchasing decisions. With decreased revenue, many advertisers have pulled back some of their advertising spend – American travel advertisers, for example, cut their spend by 50% in the first two weeks of March: that cut is likely to have increased significantly as more travel restrictions have been implemented in late March and in April.

    Advertisers are redirecting linear TV spend

    Sport is an incredibly important advertising opportunity for many brands, reaching as it does many hard-to-reach consumers, including young men. The fact that pretty much all live sports events have been cancelled or postponed for the next few months has left gaping holes in media plans and TV network revenues and has made premium audiences harder to reach. Advertisers are redirecting linear investment, particularly investment which had been targeted at sort, to other inventory controlled by the TV networks including digital inventory, as the latter attempt to make up for lost reach and hang on to ad revenue. However, brands are also increasingly redirecting linear TV spend to the streaming platforms, accelerating a trend that was already worrying the linear TV networks. It’s interesting to note that the streaming networks are unlikely to enjoy the same level of spend by advertiser as the linear TV networks do: ads on streaming platforms can be targeted to specific audience segments, allowing the advertisers to spend less money.

    With increased pressure on their bottom lines, particularly in light of an imminent recession, some brands may be tempted to remove their spend from TV and streaming altogether in favour of Google or Amazon, which are more likely to lead directly to product sales.

    Coronavirus will impact on all players in the TV industry

    The entire TV and streaming industry will be affected, but it’s likely that TV networks will suffer more than the streaming platforms, thanks in part to their reliance on live sport. Although TV viewing figures are up dramatically, this increased supply is being met with lower demand from advertisers, which is causing prices to decrease. Interestingly, when US network NBCUniversal announced that its viewing figures had increased sharply, it also shared that it would be cutting back on some of its advertising inventory in order to improve viewer experience. This is a laudable effort to stop prices plummeting, and is a trend we expect to see across the TV industry as a whole over the next months and years.

    A triple whammy of factors leading to a loss in ad revenue

    The loss of ad revenue will be a key implication of the coronavirus pandemic for the TV industry. The triple whammy of advertisers looking to make savings in their marketing budgets, a lack of live sports and the pause in production of new content leading to holes in programming, the outlook is fairly bleak, particularly for the traditional TV networks. The streaming services may fare better at least in the short term as advertisers shift their budgets to them from the traditional networks, but they will be equally affected by a lack of content down the line.

    The surge in subscriptions may be temporary

    While it seems so far that the lockdown has led to a surge in subscriptions, particularly for the streaming networks as mentioned above, the upward trend isn’t reliable. The coronavirus pandemic has caused huge increases in unemployment across the world: twinned with worries about a global recession, consumers may well be looking for ways to tighten their belts, and they might be willing to forego their streaming subscriptions, particularly when the lockdown is over and financial concerns kick in.

    Sports fans will resubscribe – but to which service?

    Whether or not they are concerned about money, sports fans in the US may also consider cancelling their pay-TV subscriptions while there is no live sport. They are likely to re-subscribe when sport returns, but could be tempted by the flexibility and lower prices of services such as YouTube and Hulu: this will be a true test of the theory that it is live sport that keeps people tethered to traditional TV.

    A lasting impact on traditional TV and the streaming platforms

    The coronavirus pandemic has accelerated and reshaped a transformation that was already happening to the TV and streaming industries. Some of the effects of the virus will undoubtedly be temporary – sport will return and advertisers will pay to reach the people that watch them – other effects, such as the shift towards the streaming platforms, will be more permanent.

    Image: Monkey Business Images/Shutterstock

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