Is Television Advertising About to Make a Comeback?

Appeared in Stuff Business - 3 September 2022

Antony Young is a co-founder of The Media Lab (formerly The Digital Café), Wellington’s largest independent media agency.

OPINION: To me, watching last Sunday night’s episode of The Brokenwood Mysteries on TV1, the most interesting part of the show took place in the ad break.

The actress whose character was bludgeoned to death in the show appeared on the morgue examination table, woke and turned to the camera to say, “makes me wish I had life insurance.”

This brand promotion by insurance company Partners Life is a clever example of how brands are using television more creatively.

We all know that TV audience ratings have been on the decline for some time. It was a procession of body blows that started in the 1980s with VCRs (something that my kids would only learn of in an episode of Stranger Things).

The arrival of Sky TV and Freeview began to fragment audiences. Add to that an ever-increasing ubiquity of YouTube and in the past few years on-demand streaming services such as Netflix have all reduced the size of TV’s commercial audiences or in adspeak its “reach”.

Brand consultant and former marketing professor Mark Ritson tells us that “reaching audiences has only been one part of the equation. It’s the impact that’s more important.”

Television companies have adjusted, changing their tack from just selling eyeballs, to packaging their media channels more creatively to advertisers and it seems to be delivering results.

For example, Three sold Weetbix a brand integration inside Match Fit that included a nutritionist advising bulky ex-All Blacks on a healthier diet. The TV broadcaster claimed this and similar programme content partnerships increase “intent to purchase” by 58%.

Clearly, television remains an effective advertising option. This is backed up by a recent UK research industry study measuring the return on investment of 1900 campaigns by 150 different advertisers showed that for every pound spent on television advertising, companies saw a £1.73 lift in profit.

Yet I’ve found TV advertising has its sceptics, many from the advertising industry itself.

Ad agency media planners are infatuated with targeting millennials and generation Z often pointing to TV’s ageing demographic as a reason to advertise in more fashionable digital media.

However, one adage I’ve always subscribed to is to follow the money. On that basis, it’s Boomers and Generation X that are more likely to buy new cars, build new homes or book a holiday in Queenstown. And while millennials are more conscious about saving the planet, we’ve found working with sustainability-driven products, that it’s actually the 50-plus audience who are most able to afford to, and therefore buy the products that help to.

Some recent announcements are about to breathe life back into TV advertising.

After years of resisting, Netflix announced it will begin introducing advertising. Its plan is to crack down on password sharing and introduce a lower subscription, ad-supported service. Disney+ is following suit.

Add that to established local streaming services for TVNZ+, ThreeNow, Sky Sport Now and in the next year could see large, desirable television advertising audiences on our 4K large-panel screens become more accessible.

I anticipate we will soon see a return to television by many advertisers. Adding to that improved digital targeting on TV will make traditional television advertising even more affordable and more cost-effective for advertisers. Look forward to the next golden TV advertising age.

Antony Young is a co-founder of The Media Lab (formerly The Digital Café), Wellington’s largest independent media agency. He spent twenty years heading media agencies in New York, London and Asia, before returning back to New Zealand.

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