We all know that TV audiences have been on a steady decline, but the NFL was the rare exception that proved the rule. Until this year, that is.
Ratings for this year's matchups have been down across the board and in double digits in some cases. While this might be a function of an unusually heated presidential election and some less-than-thrilling games, more likely this is just what you'd expect in the early stages of an industry changeover in which TV advertising is dethroned by digital.
On the one hand, the average American spends 70 minutes a day consuming digital video and, with 213.6 million viewers, digital video is close to catching up with TV for overall viewership. For those consumers, TV is merely another device to view video, and that's rapidly becoming the case for everyone.
This metamorphosis will have four major ramifications on the industry that we'll see in 2017:
Programmatic TV will start to come into its own. With no election spending on the horizon in 2017, broadcasters will be forced to embrace changes in the marketplace they were able to ignore in 2016. One is the slow and steady rise of programmatic TV. Though addressable advertising is still probably years off, the industry is starting to put in place a mechanism that will let marketers buy TV the way they buy digital media and to place buys across both simultaneously. Broadcasters still need to overcome hurdles like a lack of uniform pricing, KPIs and media-buying platforms, but they will make progress this year.
Cross-device targeting will become more refined. By cross-referencing a user's IP address with other cached IP addresses associated with a mobile device, you can usually assume that you're targeting the same user across devices. This is still a fairly new capability, but in 2017 we'll see marketers start to play with variables like frequency and sequencing. During the holidays, for instance, a marketer might want to hit a user with more generalized messages during the day but then use a call-to-action message at night when the consumer is in buying mode and on her tablet.
TV and digital video will become more alike. We are used to hearing how digital is eating the world. However, it's also true that digital marketers can learn much from TV advertising as well. Marketers are realizing that TV advertising has always been and can be very effective in brand building. They also are learning that serendipitous messaging has its benefits. Your ad may not be hitting the right target, but the ad might get some resonance anyway. For instance, a viewer might not be in the market for the product you're selling, but might think it's perfect for someone they know and buy it as a gift. Broadcast TV will continue to apply learnings from digital as well, but next year, marketers will find an appreciation for the virtues of TV too.
IoT will continue to develop as a niche market. Of course there's a chance that this could be a breakthrough year for IoT. The more likely scenario though is that this will continue to be a niche market, hovering well below the one percent range. Still, savvy companies will put their stakes in the ground, as IoT inevitably becomes part of consumers' daily lives. This is likely a 2020s technology, but 2017 is a good time to start laying a groundwork for the future.
This combination of refined targeting on multiple devices will let marketers spread their messages in ways that are both more targeted and more intimate. Marketers know that video is the most effective mode of sending a message with emotional impact. What they might not know is that the palette for that messaging is about to expand in a big way.
—James Brooks Jr. is founder and CEO of social video distribution platform GlassView