It’s one of the most interesting periods for the media planning industry in general, and TV planning specifically. With the digital transformation taking place across all industries, advertising seems to be the pivotal point, undergoing constant auditing with CMOs aiming towards more efficiencies. And while the media mix shows high indexing on TV spends, it becomes crucial for all industry specialists to optimise further on the touchpoint they invest the most behind.
Television is a phenomenon in the Arab region for obvious reasons:
- High consumption habits;
- Up to 90 per cent penetration in most Pan-Arab markets;
- Centralised viewership across GCC markets;
- The holy month of Ramadan and its impact on TV viewership and production houses’ investments;
- Leading touchpoint for brand building and awareness.
These facts have allowed brand managers to deliver on marketing objectives in the past decades, yet with the increasing competition and clutter rate, unstable financial situations and multi-purpose digital touchpoints, TV planning is no longer a walk in the park.
Having a centralised viewership makes reach planning easier, but it also means all advertisers are racing for positions on the same list of stations. Brands from the same category are fighting for share of voice (SOV) with up to 10 players in some categories.
This is having a major impact on SOV targets, as it becomes costly for brands to secure minimal SOV in some categories, which makes them question if TV is the right touchpoint in the first place. In such cases a lot
of brands are activating other mediums and opting for a more cost-efficient battle.
Finally, on this note, gross rating point (GRP) planning was solely based on live competitors’ SOV benchmarks, however third-party research is now helping brand managers identify maximum GRP response points and points of diminishing returns, which is putting more budget restrictions on blind buying.
Regional financial situation
For the past half decade, we have witnessed aggressive promotional strategies even from categories with no promotional history. With a shrinking retail basket size and decreasing demand in most categories, many brands are adopting promotional strategies and cutting revenues to maintain liquidity and cut short-term losses.
While brands cannot fully accommodate a dual strategy of promotions and mass advertising, the latter is being addressed with more surgical activities and cost-efficient investments. In other words, measurable and short-term-ROI advertising.
Digital touchpoints are providing advertisers with full-funnel solutions. The social giants are reaching new heights in terms of penetration and in some markets exceeding the 90 per cent reach associated with TV. This means the awareness element, previously a challenge on digital, is now addressed efficiently.
Reversely, TV’s limitation on mid- and lower-funnel objectives pushed brands toward cost-efficient ways to build consideration and conversions, and marketing strategies now start with budget allocation based on consumer journey phase rather than media touchpoint.
On a separate note, a 2018 TV viewership report showed an 18 per cent drop in TV ratings. This made buying reach more expensive, and therefore brands are settling for lower TV reach levels and buying increments through online video.
The industry is more vulnerable to change and technology is affecting traditional and digital touchpoints equally. That said, the region is adopting TV attribution-to-sales technologies that will add measurement layers to TV impact on conversion and retention objectives. This will open doors to new categories advertising on TV, and will shift sights from the infamous GRPs and reach percentages to costs per lead, a more reasonable indication of media ROI. While this sounds futuristic, all industry specialists should be well equipped to have such discussions with clients and partners in their 2020 planning.