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BizReport : Advertising : January 02, 2020

Experts predict how OOH and TV ads will impact brands

According to data out from eMarketer, the connected television ad spend will push upwards of $9 billion this year. Their data also indicates that merchants and retailers will be putting more of their ad budgets into connected TV. Simply advertising, though, isn't enough. Here's how some experts believe the OOH and connected TV spend will impact merchants and brands.

by Kristina Knight

Retailers will focus on the brand experience

"There will be a resurgence of consumers wanting to touch, feel and interact with the products they purchase in novel ways. To stay ahead of the curve and continue meeting the evolving needs of the consumer, smart retailers must put more of a focus on brand experience versus value or price," said James Heller, Co-Founder and CEO, Wrapify. "In addition, traditional media including Direct Mail and OOH will experience an increased share of ad spend, and multi-touch attribution will become more refined, allowing retail marketers to better understand how offline media affects online spend and performance. Lastly, depending on the outcome of the upcoming election and if the current market has the ability to sustain the longest bull market in U.S. history, retail spend will likely decrease in 2020."

Events will continue to bring viewers to TV

"2020 will be the year of the paradox for linear TV.  On one hand, cord-cutting is accelerating.  In 2019, it's believed that 6.4m paid subscribers stopped paying for television and predictions are for 2020 an almost equal, incremental decline.   The erosion of television viewership undermines the entire television business model.  But despite the major market contraction, linear cable & broadcasters are poised for a superb year," said Todd Krizelman, CEO, MediaRadarThere are four reasons:
a.       Large tent-poll events like the Super Bowl deliver financial results. Fox reported at the start of December that 80% of the inventory has already sold at a reported $5.6M per 30 seconds (a 7% markup from last year).
b.       The 2020 presidential election looks like it will be one of the most intense in recent memory and politicians will spend significantly to get their message out to as many as possible.
c.       The 2020 Summer Olympics are in Tokyo.
d.       Every major broadcaster will either reboot or unveil their paid steaming business.  While this is just "Day 1", this is a step for many broadcasters to innovate and re-engage with audience.

The pace of investment in the OTT space has been dizzying in recent years, and 2020 will be no different. UBS estimates a combination of 16 media firms will combine to spend $100B producing content in 2020.
Just three firms (Netflix, Disney, & WarnerMedia) are expected to account for 25% of that spend producing unique content for their viewers. For the financial health of the companies competing in this space, this cannot last long-term, but don't look for the investment to slow down anytime soon. Bob Iger has acknowledged Disney+ won't break-even for at least the first 5 years, and AT&T has said the same of upcoming platform HBO Max. Eventually prices will rise, ad-supported models will become more common, and spend on content will come down to ensure profitability."

Merchants will leverage digital assets for TV targeting

""While retailers have invaluable data about audiences, activating it for connected TV and cross-screen campaigns has been challenging as of late -- putting them at a disadvantage compared to the massive online retailers dominating the market. We'll see this start to change in 2020 as retailers begin to leverage digital assets for TV advertising and find a path toward being more competitive," said Philip Smolin, Chief Strategy Officer, Amobee. "As consumers are constantly moving between screens, understanding the intersection of connected TV, linear TV and digital media is a massive advantage for retailers, and being able to utilize data across those screens opens the door for more holistic media planning and attribution -- an asset for retailers ability to stay competitive in the converged world."

Look for more budget dollars going to CTV

"eMarketer estimates that Connected TV ad spend will grow to nearly $9 billion in 2020, and we'll see retailers make the medium a critical part of their 2020 advertising strategies to build immersive experiences and reach the right consumers with more personalized and local messages," said Stephanie Scheper, Sr. Director of Sales, Tremor Video. "We believe retailers will begin to take notice of the medium's impact on upper and lower-funnel metrics alike - building awareness as well as driving foot traffic, web traffic and purchase intent. We've seen CTV campaigns that use location-based targeting to drive incremental lift in store foot traffic within the 25% range, and with this surge in ad spend and impact YoY, we expect retailers will continue to discover the true power of CTV in 2020."

Tags: advertising, advertising trends, Amobee, MediaRadar, mobile marketing, OOH advertising, Tremor Video, TV advertising, Wrapify

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