Falling TV audiences aren’t the problem, fixed inventory is

Great article Paul.

The real interesting point to note is this is exactly how TV was traded in the 80s when I worked at Thames TV in London.

Deals were done at a volume and share commitment based level against what was known as station average price, calculated as a CPM.

The inventory was still fixed in terms of the amount of commercial minutes, but rates were set by market demand due to published ratecards with up to 30 levels. TV buyers could buy spots even on day of transmission by simply paying a higher level on the ratecard. If you wanted to buy a spot and guarantee it stayed there you simply paid a premium for that spot.

Then your schedule was adjusted through negotiations between buyer and seller based on delivering the deal vs average station price. The key piece of information in the equation was being able to predict the audience a) for each spot, and b) for your overall schedule, so that you delivered the reach & frequency objectives set by the media planner.

In those days we had only two commercial channels but the country was divided into 14 separate geographic markets with airtime traded on a market by market basis. London was divided into weekdays (Thames) and weekends (LWT), and trust me the rivalry between each sales team was far more aggressive than the cosy rivalry between the networks here.

When it came to auditing it was simple. Good buyers delivered on the usual campaign objectives – TARPS, WEEKLY STRIKE RATES, R& F GOALS, PROGRAMME QUALITY, ETC – and price was audited a) against your deal, and b) against the pool of other buyers. Good buyers who consistently performed well against these metric got paid more or were poached. Bad buyers became sellers, and vice versa.

Sigh…how i miss those good old days. Ask any of the Poms out here, Whitey, Wristy Wright, Mal Dale, Gary Hardwick, Chris Walton, Greety – the list is endless. Have I missed anything boys? Oh, I forgot, we didn’t have mobiles and we went to the pub for lunch and after work most days, usually paid for the the TV networks.

i wonder if a back to the future approach could work here?

“There you go. I said it. Somehow I feel better for saying it. Phew!”

Your industry’s in a ton of trouble if an obvious fact from the 90s is this hard to articulate.

Here’s a new “fact”, 400 million people are using ad-blockers. Many, many more access torrents. Don’t have the stats for Australia, but in my extended social circles adblock usage and file-sharing runs at about 90 per cent.

Time for a new advertising dynamic based on mutual respect, because the old model of deceiving the crap out of your audience has earned nothing but disdain and led to the modern phenomenon of entire families (such as mine) enjoying all their digital content blissfully ad free.

@jack – you know this is a media and marketing website?

Hey Jack,

In the past 30 years the most effective campaigns (i.e. those that sold the most stuff) have had TV at their core.

In the past 2 years my team has executed our two most successful campaigns in the history of the business, and guess what 80% of our marketing investment has been on TV.

If you read the Effies guide to winning cases, most of them have TV as their core medium.

Good on you for exercising your freedom of choice (to potentially break the law, depending on how you download all your content), but answer this question, if you shut out all advertising, how do you know what stuff or brands to buy?

That wasn’t hard to articulate. Neither was my comment above. Given your love of audio visual content you’re probably a visual learner. Would you like me to draw you a picture of how it used to work in the 80s?

Hi Paul,
Don’t ‘make goods’ effectively play this role? Crude I know, but still effective. Or is the issue that these ‘credits’ go to the buyer rather than the advertiser?

Yes, and right from the beginning, a major demographic is left out of the picture, as usual: what about the stats on people who *don’t* live the The City? Yes, such creatures do exist. Indeed, more and more people are moving to rural areas: when we first moved to the country, our shire was the fastest-growing in NSW outside of Sydney proper.

The impact of the viewing habits of non-urban dwellers may be more significant than you have given thought to. When the nation made the switch to digital, many semi-rural and rural dwellers immediately experienced reception problems or lost their television signals entirely. The solution? Have a VAST antenna installed. Cost in my area is around $800. That really changes the notion of ‘free to air’.

But that’s not very expensive, the installer said to me. Really? Not everyone with a mortagage and kids in schools can justify the spend all in one hit. Nor can people on fixed budgets.

Maybe it’s a small point, but people can’t watch television if they don’t have access to it.

Paddy – Your questions: “if you shut out all advertising, how do you know what stuff or brands to buy.”

You do realise that people also read articles, listen to friends, talk on forums, use social media and can do a lot of that with adblockers etc and still manage to make up their mind on what toothpaste to buy etc? You may want to stop thinking people are so dumb that they can only go buy things based on seeing an advert.

Hi Scott,

Thanks for the comment.

My original comment (short essay / story) was in response to Paul’s original opinion piece, and I thought relevant due to personal experience of working in different markets in a pre-digital era.
The comment that you have tried to take issue with, was a very simplistic observation with more than a small dose of irony / sarcasm.

I am fully aware of all influences on ultimate purchase decision, including word of mouth, catalogues, direct mail (soft and hard versions), just seeing the product in use (football boots), on my favourite team’s jumper (our national, and the world’s biggest airline – not the same by the way), even down to the message at eye level and arm’s length at point of sale – the price promotion.

As someone with a 30 year career that has covered roles in media sales, media agencies, creative agencies, my own consultancy, and now on the client side I’m happy that I’ve pretty much all bases covered.

Aleta,

Gee, you must live in a pretty remote area to not be able to receive a TV signal. Do you have a phone line?

Hey Scott,

Are you the same Scott Rhodie who works for the NBNCo?
If so, can I introduce you to Aleta, I think she needs your help more than I do. 🙂

Paddy, sadly I left NBN Co two years ago (ah how time flies!) so there is nothing I can do to get Aleta some faster internet 🙁

Thanks for your response also. Was just curious as I see too many people focus on Advertising as the only solution.

Scott, no worries.

Just goes to show how up to date I am!
Have a great weekend.

Paddy

Article on TV viewing down

Tosh, I’m sure Jack is aware that this is a media and marketing website, with the emphasis on marketing.

Where better to make the point that TV is crippled by being overloaded with advertising?

I’m with Jack. Its a bit of a concern that Paul’s just noticed the TV audience decline. HUTs have been more or less in decline for years.