BrainTrust Query: What Happens to Traditional Media When it Goes Digital?

Discussion
Jun 30, 2010
Joel Rubinson

Commentary by Joel Rubinson, Chief Research Officer, The Advertising Research
Foundation

Through a special arrangement, presented here for discussion is an
excerpt from a current article from the Joel Rubinson on Marketing Research
Consulting
blog.

At the ARF Audience Measurement conference last week, some
speakers really got me thinking about what happens when all media becomes digital. 
Here are three forces that could produce profound changes in media and advertising
both from a business and user experience point of view.

Everything will become digital

Digital used to be synonymous with online but everything will become digital.
Dave Poltrack from CBS predicts a huge increase in HD, 3D, and IPTV TV sales. 
David Verklin, president of Canoe Ventures, talks about the interactive TV
advertising experience that will be nationally available. Video in Facebook?
How about Facebook built into your new 55" HD 3D TV? The future of print media
is being revolutionized by electronic readers like iPad. One can also imagine
codes being inserted into print advertising or editorial pieces that, when
captured by a smart phone, instantly leads to a multi-media experience or electronic
coupon.

No longer is CBS a TV company or Time, Inc. a magazine; no longer is "media
platform" the business organizing principle.  Now, the media property
is the organizing principle and it must live synergistically across platforms.

Data will always trail the media possibilities

New touchpoints are emerging weekly, it seems.  Advertising via the iPad
was born so very recently.  Apps for smart phones that create amazing location-awareness
and shopper marketing options are emerging so fast it is mind-numbing.  How
can a manufacturer not want to put codes on packages that, via a reader on
any smart phone, can now bring a brand’s story to life with sight, sound,
and motion at point of purchase? Digitization allows a marketer to guide a
consumer along the path to purchase right to the check-out.

The point is, syndicated
media research data bases, custom marketing research assessment can’t
possibly get ahead of this; they will always be playing catch-up, focusing
on the most significant of the touchpoints that are attracting substantial
funds.

The importance of understanding audience size will diminish

The most important things in traditional media, the stats we all understand,
relate to audience size (GRPs, circ, etc.). However, imagine watching an episode
of House on a platform that allows for selective ad serving.  As soon as two
different households start getting different ads served to them, measuring
total audience becomes less important to the advertiser. Online, monthly uniques
are a guide to which sites an advertiser should consider but they are paying
for impressions served (or clicks).  "Traditional" media could/should
move to this model as it becomes digital.

If this comes to pass as traditional
media become digital, imagine the implications for syndicated media currency
databases, and media tools. While this will be traumatic to the existing infrastructure
for "traditional media",
the increased business value of advertising and the increased CPMs that advertising
should command when it is made more relevant based on intelligent serving rules
are potentially very significant.

Discussion Questions: What obvious and less obvious changes do you see occurring
as traditional media increasingly shifts to digital? What will be the most challenging
hurdle for marketers?

Please practice The RetailWire Golden Rule when submitting your comments.

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9 Comments on "BrainTrust Query: What Happens to Traditional Media When it Goes Digital?"


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Max Goldberg
Guest
10 years 10 months ago
All media becoming digital is not a startling revelation–things have been headed in that direction for years. Digital media simply acknowledges that the consumer is in control. She can watch whatever advertising she wants, whenever she wants it. Marketers will pay media outlets for actions rather than impressions. As long as there has been advertising, marketers have wanted to be able to target their media dollars and pay for consumers taking action, rather than just seeing ads. Well, that time is here and many marketers are scared. Now they will have to create messages that engage consumers beyond passively sitting and watching an ad. If they do it well, marketers will be rewarded with the ability to reach a consumer at the moment she is considering a purchase. She will be open to engaging with the brand. Information and offers from the brand will be welcomed. To be successful in this new world brands will have to listen, engage and be instantly and easily available. How many brands are really ready to do this?
Jonathan Marek
Guest
10 years 10 months ago

Interesting thoughts. Clearly this change makes media a much richer ground for testing and continuous improvement, even down to a consumer level. ROI will matter more than ever. The levers to increase ad ROI will be clearer than ever.

It’ll be fascinating to watch how ad pricing changes as the world moves digital, and therefore addressable, especially in TV where national network and national cable rule. Will the spot premium disappear? Will we see pricing per delivered, targeted impression? Will we even see a CPC model for some TV ads (click here to buy your Sham Wow!)? Networks will resist, but hopefully we will see moves away from old pricing models sooner rather than later.

Doug Stephens
Guest
Doug Stephens
10 years 10 months ago

The transformational power of digital media goes well beyond characteristics of delivery and targeting. The real magic lies in the ability to share the media and even share experiencing the media.

Ironically, our TV sets may become the primal campfire we gather around–not simply to mindlessly consume information but rather to share, relate and experience it with one another.

Warren Thayer
Guest
10 years 10 months ago

There’s a fascinating piece in the June issue of The Atlantic (that’s a “print” magazine–you can read about such antiquarian and odd things online) about how Google is trying to save the news business, in its own self-interest. There are so many subtleties in all this, and I get annoyed at “research” that tells us just what the bright and glowing future will be. I so distinctly recall the dot.com hype, which I ridiculed from the start and wasn’t surprised to see come crashing down.

Right now I see further media fragmentation, more difficult decisions on media spend, and, most likely, not a huge gain, at least over the next few years, on advertising ROI until we get a shakeout. The promises and the hype coming out of everywhere on what all this is going to do to revolutionize everything overnight is, at least to me, very reminiscent of the dot.com dot.con.

Roger Saunders
Guest
10 years 10 months ago

The most profound changes are likely to come from marketers who insist that media and their agencies take a holistic view of media spend, and pay closer attention to HOW MEDIA INFLUENCES purchase behavior and attitudes.

We’ll be using print, broadcast, radio, outdoor, and digital over the next 10 years…they are not going to go away. The media allocation has to have a focus as to what is the right path now.

The inertia of the media won’t lead marketers out 1950s measurements. Nor will advertising agencies, who have a vested interest in traditional, or “new” media. Marketers–retailers and manufacturers–will end up rattling cages, and saying “Look guys, we’re trying to touch consumers, not the application (media) that you are hawking!”

Ed Rosenbaum
Guest
10 years 10 months ago

Can you imagine everything becoming digital? What a thought! I do not think it is that far fetched. Change is happening at such a rapid pace that today’s iPhone is replaced tomorrow. Lines at AT&T stores are becoming common place. (Not for me. I still rely on my BlackBerry.)

I am picturing traditional media companies in their board rooms reading these posts and thinking “OMG, what do we have to do to even stay on pace with these changes?” Obviously change is in the works. News media are more and more available online. I think USA Today was one of the first. If I am correct, they changed the print media 30 some years back and are still pushing the progressive, aggressive buttons.

Kevin Price
Guest
Kevin Price
10 years 10 months ago

Joel’s thought leadership continues…we all owe him an enormous quantity of thanks!

In my mind, the main question posed, “the most challenging hurdle for marketers,” only has a high-level response at this point: “What to do in response to fundamental, structural change.” ‘Digital’ is that fundamental, structural change which will enable new and different ways to do many, many things. Using history as a guide, most marketers will be slow to respond. Those who determine how to advantage themselves as a result of this structural change will gain in the marketplace.

This inexorable move toward all things digital presents enormous and significant opportunities for those who dive in, understand the implications, and create new and different solutions which leverage this massive change. These are exciting times!

Ben Sprecher
Guest
Ben Sprecher
10 years 10 months ago
Joel hit the nail right on the head when he says that the importance of audience size will diminish. Digital media is really about audience sizes trending towards the magic number: 1. In fact, “audience” as a word may eventually become meaningless. Consider the 42-year-old mother of two with a 4-year-old black lab who is approaching the grocery store between her office and her house at 5:30 PM, with “Dinner” and “Food for Rex” on her shopping list. She is not an audience, she is a critical opportunity–at that moment, at that location. IAMS may want to reach her with a coupon for their new dog food. The grocery store may want her to know about their newly-improved salad bar and the number of hot rotisserie chickens available right now. And the restaurant near her house may want to offer her free dessert if she makes her reservation for 6:00 PM tonight. The challenge, of course, will be making sense of all the additional dimensions of your potential “audience”, and finding ways to manage and… Read more »
Shilpa Rao
Guest
10 years 10 months ago

Well as Ben correctly pointed out, personalizations come with its set of complexities and not everyone would have the scale and the volume to make it profitable. It would be difficult to gauge the impact.

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