"Marketing budgets for digital have been increasing year after year; however, TV still accounts for the bulk of spends. Digital advertising is bound to see a significant jump, at the cost of TV, due to multiple reasons."
The growth of Digital's share in the advertising pie has been undeniable.
This growth has come at the expense of most other forms of media, except Television. TV still commands the maximum share of the advertising pie and, in fact, continues to grow.
However, this trend may change sooner than you can imagine because of multiple factors.
At the outset, let's understand some of the key reasons why Television has been a preferred medium for advertisers who could afford it, and also some of its constraints as a medium.
1. Nothing beats an audio-visual format for storytelling: for the longest of time, TV was the only medium that offered a very good quality audio-visual format.
2. TV could deliver a very large reach: you want to launch your new chocolate brand or your beverage drink or your new auto model, the one quick way of getting word out to a large audience, was by putting out a TV commercial, because it could give you a large reach, second to no other format
3. Real-time events: in specific, live events like a cricket match or a Union Budget speech, the audio-visual format, combined with real-time unveiling of information, has led the pitch for TV as a preferred medium.
For most advertisers, these have been the prime drivers towards Television.
As against this, the constraints of TV as a medium for advertising, first of all, was its high media cost. You're talking thousands of dollars for a 'blink-and-you-miss' few seconds of television advertising.
Secondly, the options of finding a very specific target audience were minimal. And if your option to not finding a desired target audience, was to go broad-based, and advertise on a mainstream GEC channel, the options were limited and competition to advertise was fierce, driving the costs high.
That said, the advertiser who could afford to spend those kinds of monies, continued to advertise on TV, making it the no. 1 format for advertisements.
While everyone in the media world would agree that Digital would keep increasing its share of the pie, slowly but surely, a few would concede that a further rather rapid growth in Digital advertising could come at the expense of TV.
I am one of those few, and the reasons I firmly believe this will happen, are shared below.
Let's start with the three primary reasons that drew the advertiser to TV, as mentioned above.
1. The audio-visual format of storytelling: this is no longer restricted to TV anymore. Digital destinations like YouTube, Facebook, Instagram, Twitter, etc. have made video easy to deliver and consume, and are firm contenders as options to showcase a brand's audio-visual stories. A lot of TV is, anyway, consumed on smaller screens today. But even if you were interested to view your films on a larger screen, you have options like: a) smart TVs that seamlessly show Digital content and b) options like Apple TV and others that enable you to mirror your mobile screen onto a larger screen.
Clearly Television's advantage of showcasing a rich audio-visual story, has been nullified.
2. Then there was the question of a large reach: So yes, some popular GEC programs or a live cricket match, might still deliver a one-off larger total reach, if you think in terms of a single instant visibility across the board. But the Digital numbers have gone up and up and up. The Indian internet user base has climbed to around 325 million, and is growing rapidly. There ARE options available today, as individual ones or as a combination of a few popular Digital destinations, that could deliver millions in terms of reach, for an advertiser. So, quantity for quantity, Digital has come within striking distance of matching the numbers for the most popular TV programme, and is already bigger than the large number of other TV programmes, whose reach is much smaller. At this time, I am not even talking about the quality of audience delivered.
3. What about live/real-time content that TV delivers? Well, Facebook Live is here, and is becoming increasingly popular. Plus there is Periscope as well as other options too. Yes, these are early days, but the fact that good, easy real-time streaming technology is now available and one can use it on a simple 3G or 4G connection (which is also very accessible now) means that it is just a matter of time, before Television's dominance on real-time broadcasting ends. What's to stop, say, the next Fashion Show, to do a Facebook Live-only broadcast, and not negotiate hard with a TV channel? You could always have done live broadcast of your events earlier too, but now, with platforms like Facebook, you can get a very large audience too in real time!
These were the three main drivers towards Television and, as we can see, all three of them, are being challenged.
So, if such interesting options are available, why would one pay big money to Television for advertising? If a brand can deliver its audio-visual story, to a large audience, maybe even riding on top of a live, real-time event, and the brand can do all of these, for a fraction of the cost of TV advertising, isn't it a no-brainer that budgets will shift from TV to Digital, soon? Very soon.
Still not convinced? Read the second part of this argument here.
Sanjay Mehta is the Joint CEO of Mirum (India), a WPP digital agency. Views expressed here are personal.