Opportunities, And Challenges, And Dangers... Oh, My!
If there is one movie that everyone on the planet has seen it’s The Wizard of Oz. I remember watching it as a child and being drawn into it by the journey Dorothy was taking along the Yellow Brick Road. As I grew older, and continued to watch the movie — I may have watched it 50 times — I began to realize all the characters in the film were on a journey, all their own.
When I founded R2 Media in 2010, I wanted to build an ad agency that would enable regional and local advertisers to run geographically-targeted campaigns, across every tactic imaginable, in an efficient and effective way. And so my journey began.
Perhaps my geographic orientation was rooted in the work I did as a NBC correspondent in Columbia, Missouri and Charleston, West Virginia. As a result, R2 Media has always been a hyper-local shop, and we always focused on Omnichannel advertising. Most interestingly, today, the essence of our organization is more intune with the ad market than at any time in our firm’s history. But why is that, you may ask? The answer is a confluence of opportunities, challenges, and dangers.
Among the timely opportunities is the emergence of connected TV as the tentpole digital media platform for an omnichannel program. CTV brings not only a traditional television audience, with all the soft and hard advantages of reaching passive viewers, but it adds a rich set of data that can act as the foundation for an overall omnichannel program.
Connected TVs – Internet capable TVs that incorporate the interactive capabilities of a digital media box along with traditional broadcast reception – have, along with standalone streaming media devices, become an increasingly central element to this approach. By the end of last year an estimated 44 percent of US households had both a connected TV and a separate streaming media player.
In 2021 Nielson estimated that digital advertising delivered through connected TVs reached 142 million Americans every week.
It shouldn’t come as a surprise that advertisers had already taken note of that trend and increased their ad spend on the platform accordingly. From 2019 to 2020, for example, US advertisers increased their CTV spend by $2.6 billion, for a total outlay of more than $9 billion, and was estimated to exceed $13 billion in 2021 – roughly equivalent to all radio advertising buys that year.
The common, timely challenge for all advertisers is the stark contrast between consumer behavior and attitudes before the pandemic and ever since. While a segment of the consumer market has returned to pre-pandemic behaviour and attitudes, there is a substantial segment that has fundamentally changed how it interacts with brands, how it shops, indeed how it engages with the outside world. Those are the consumers who shop online and employ either home delivery or contactless pickup from the growing number of retail chains offering that service.
They’re the consumers who, worn down by years of anxiety and isolation, no longer just crave, but demand better shopping and overall experiences from the brands they embrace. They’re the consumers who are just as likely to be reached – maybe even more so – while listening to a podcast as they are listening to radio. They’re on social media, they probably have a connected TV or a digital media device in the home, and they communicate with brands far more often through smart phone apps than they do with the phone itself.
And the danger? The landscape has shifted and it’s not going back to old ways. Just as home entertainment evolved from radio, to television, to Internet – to today’s rich, interconnected media mix – so has the advertising audience. And the brands with staying power will follow their audience, wherever they go.
Dorothy's journey ultimately ended with her safe return to Kansas. My journey is ongoing, but I'm happy to say, I am right where I need to be.