Will TV commercials become a thing of the past?

Advertisers are pulling out en masse: Will TV commercials become a thing of the past?

A UK survey of 56 advertisers found that linear TV ad spend will see the most drastic budget cuts.

67 percent of them said they would make the deepest cuts to TV broadcasting – the channel on which advertisers have so far tended to invest a large part of their spending. Meanwhile, four out of 10 major marketers said they plan to reduce investment in traditional media such as TV, radio, print and outdoor.

The research surveyed some of the UK’s biggest advertisers, including Unilever, Tesco and Procter & Gamble.

Phil Smith, managing director of Isba, the agency that carried out the survey, said: “The survey clearly shows the impact of the recession on the spending plans of major brands. There is a general shift towards greater flexibility of commitment and significant momentum towards digital delivery in every medium.”

Advertising, billboards (Unsplash)

Ali Lindsay Clay, executive director Thinkbox-a, the commercial TV marketing body, questioned the results saying: “Nothing works better than TV advertising, but with businesses under economic pressure, it’s no surprise that they are reviewing their advertising spend. What this survey shows is that most plan to invest more in VOD broadcasters and less in linear TV. This is a rebalancing that has been happening for some time. They are changing the way they use TV. Total TV advertising will be resilient.”

She adds that declining demand from advertisers could be the perfect time for some brands to invest, with prices likely to be reduced from current levels.

“This is an opportunity and a competitive advantage for those advertisers who can still invest. It also opens doors for brands that previously might not have thought they could be on TV – which we’ve seen during the pandemic,” explains Clay.

“All the evidence shows that keeping advertising in a slump is the best way to come out of it faster and stronger, but that’s not always possible. We hope that advertisers will examine the evidence on which media offers the best value for money, the lowest risk and the highest return. Free tools like Media Mix Navigator are here to help make investment decisions with unbiased data,” notes Clay.

HBO Max

TV (Pixabay)

The recession led to cuts

News that the UK has slipped into recession has left retailers scrambling to re-create budgets for even tougher times. While the loss of linear consumption will hurt broadcasters, they are currently seeing strong demand in their digital networks as customers get used to more targeted shopping.

In the Isba study, one third of respondents intend to increase spending on paid search and social networks. Another area likely to see an increase in investment is brand building activities, with 30 percent of companies surveyed committed to long-term investment.

Recent research by Thinkbox and numerous media agencies has finally proven that advertising campaigns using linear and BVOD (broadcaster video on demand) tend to be more effective and offer greater reach to younger audiences. Broadcasters are evolving to reflect the importance of streaming video to their business models. Recently, ITV refreshed its brand to give equal weight to broadcast and streaming.

Source: BIZLife

Photo: Unsplash


Source: BIZlife by bizlife.rs.

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