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Live TV Flight

  |  May 3, 2012   |  Comments

Choice, control, and general on-demand access are becoming the expectation rather than the exception.

There was a lot of buzz last week about declining TV ratings. Amid ratings drops as high as 20 percent, some comments from network executives might even be described as bordering on "panic." The New York Times, LA Times, Washington Post, and more all featured articles on slipping ratings for both broadcast and cable nets, littered with reactions from broadcasters and digital production/service providers alike.

The consensus seems to be that there are a wide variety of reasons for the sudden drop; analysts have cited an increase in the amount of reruns and big declines in aging programs ("American Idol," for example). But there's also clearly an underlying theme that has been building for years: the way people watch "TV" is changing dramatically.

And I think that's the key. People are sending a message to Hollywood. They're fleeing live television in often alarming numbers, and they've got good reason. They've been empowered with choice and control by digital technologies like the DVR and increasingly impressive libraries of on-demand content that often have zero advertising. Viewers are also demonstrating that they will go to great lengths to avoid advertising, mostly because the TV industry has cranked up the ad load to an unacceptable level. People are embracing streaming video across a wide variety of devices - ranging from mobile to tablet to connected television platforms and so on. They don't care about release windows, regional broadcasting rights/restrictions, or any other limitations of the television distribution business. They just want what they want, when they want it, and on the device of their choosing.

There's no putting the genie back in the bottle here. Once you get a taste of this new way to watch, it's nearly impossible to go back. Even an NBC executive came to this realization. As quoted in The New York Times article, Jeff Gaspin from NBC, after having watched two full seasons of "Walking Dead" on-demand, watched the season finale live and said, "We watched that live. It was not nearly as good. The commercials broke the tension. We had watched the other episodes with blankets over our heads. I hate to say this to the AMC executives and everybody else in the business, but I will never watch 'Walking Dead' live again." Choice, control, and general on-demand access are becoming the expectation rather than the exception.

And guess what? It's only going to get worse as connected devices continue their remarkable growth, adding more fuel to this fire. Analysts are forecasting that more than 100 million tablets will be sold worldwide this year alone. And video consumption is an extremely popular tablet behavior: 91 percent of U.S. tablet owners have watched a TV show or movie on their tablet according to eMarketer (up from 68 percent last year). More than 30 million TVs in the U.S. are currently connected to the web in some fashion (game consoles, Blu-ray players, direct connection, over-the-top boxes like Boxee, etc.), and torrid growth is projected here as well. By 2016, more than 500 million TV sets (worldwide) will be connected to the Internet (according to Digital TV Research). We haven't even touched on social TV and mobile/tablet multitasking (which I wrote a more in-depth piece on here) - both of which are also disrupting the TV ecosystem and driving more change in consumer behavior.

So what does this all mean for marketers in 2012? There are a few key takeaways from my perspective:

  • Don't panic (yet). Go deep and understand the evolving landscape and what's happening with your particular audience. Ask your agency for help, and make time to meet with some of the leading vendors in the space.
  • The role of the TV spot isn't changing - it has already changed. It used to be the central expression of the brand - the core of a "big idea." Now, it's a gateway to something else - a digital experience either on the TV itself or via whatever connected device it appears on. And this will only become increasingly important. Your (or your agency's - or both) ideation and production processes must adapt. Multi-channel is so 2011. It's time to start thinking omni-channel.
  • Now is the time to test and learn. This stuff, and corresponding new ad/engagement models, already have decent scale, and more is on the way. But it's fragmented, and for now, that's OK. It makes it easy to carve off a relatively small portion of your audience to experiment with. Find a partner/platform that fits your needs and get in deep. Test, learn, and then evolve by broadening your scope to more and more platforms.
  • Above all else, respect the consumer and their expectations of choice and control. Be wary of ad models/formats that try to combat this (no ability to skip ads, etc.). As always, the brand's opportunity here is to provide value to the audience.

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ABOUT THE AUTHOR

Jeremy Lockhorn

Jeremy Lockhorn leads the emerging media practice (EMP) at Razorfish. The team functions as a think-tank on new technologies and next-generation media, and operates as an extension of current client teams. EMP is focused on driving groundbreaking marketing solutions for clients. Jeremy is a filter, consultant, and catalyst for innovation - helping clients and internal teams to understand, evaluate, and roll out strategic pilot programs while reinventing marketing strategies to leverage the power of emerging media. Jeremy joined the agency in 1997 and is currently based in Seattle, WA. His Twitter handle is @newmediageek.

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