← Behind the Numbers: an EMARKETER Podcast
Behind the Numbers: an EMARKETER Podcast
How Much Traditional Media Still Matters: Last Stand—or a New Beginning? | Behind the Numbers
00:20:47
Loading summary
Transcript41 lines
- [00:00]
A
Consumers skip ads, but they don't skip rewards. Of course not. Fetch drives performance. With over 12 and a half million monthly active users and over 11 and a half million receipts scanned daily. That captures close to 90% of household spend. Your brand becomes the reward, earning real engagement, verified purchases and loyalty. Fetch America's rewards app, where brands are the center of joy. Hey, gang. It's Monday, October 13th. Ross, Zach and listeners, welcome to behind the Numbers new market video podcast made possible by Fetch Rewards. I'm Marcus and join me for today's conversation. We have senior digital media analyst living just north of New York City. It's Ross Benish.
- [00:48]
B
Hey, Marcus.
- [00:49]
A
Hey, fella. And we also joined by senior forecasting analyst living life out in Salt Lake City, Utah, of course is Zach Goldner.
- [00:58]
C
Thank you, Marcus, and welcome to soup season.
- [01:01]
A
It is. Well, it is.
- [01:05]
C
October is the official start of soup season.
- [01:07]
A
It's still 90 degrees here in Chicago, so hopefully soon.
- [01:13]
C
Cool it down. Love some ice in that.
- [01:15]
A
Today's fact. Nicholas Alkamar fell out of a plane and was fine. Englishman Nicholas Alkermard was a tail gunner during World War II and survived a fall from 18, 000ft without a parachute. He was shot down out of the sky. His parachute caught fire and so he jumped rather than going down with the plane and landed on fire. Fir trees and thick snow, escaping the incident with just a broken leg. I still don't believe this one is real. I was searching for hours to try to verify this one. It seems legitimate somehow.
- [02:06]
C
I need that kind of milky he was having. Those are some good bones.
- [02:11]
A
I know. Forget soup. Oh, my whole milk is where it's at, apparently. Anyway, today's real topic, how much traditional media still matters. What is that? 2% for Americans? Is that what you call raw.
- [02:28]
C
Raw milk is. Is what all the Americans are talking about. Oh, boys. Oh, dear. Don't have to open up words on this podcast.
- [02:37]
A
Today's real topic, how much traditional media still matters. All right. Whilst digital ad spending takes over America, traditional media ad spending still still commands 20% of the pie, or close to a hundred billion dollars. That's tv, that's radio, that's print. That's out of home. Things like that tv, we'll start there. It's the biggest part of the traditional slice. You wouldn't be at fault for thinking that streaming TV has already swallowed linear TV whole because pay TVs pay TV household numbers. Pay TV households fell below 50% for the first time this year, according to Zack's forecasting crew and Nielsen's gauge says that time spent watching streaming services overtook linear share in May of this year. The split is now 46% streaming and 40 basically 2% to linear in terms of where people are spending their time with the television. The rest is other. Yet despite what the viewership numbers are telling us, our analyst Marissa Jones points out in an article that CTV will soon command just 1/3 of total TV ad spend. So CTV plus linear just 1/3 of that proportion or portion? Not proportion. It's a proportion of the portion. According to Madison and Wall, we forecast that CTV, including political advertising, will be closer to 40% of overall TV ad spend, but still the minority. We're playing blame pie. Ross, we'll start with you. What's currently happening. Oh my goodness. I had a suspicion you hadn't read the brief. Okay, we're gonna play mystery question where Ross is going to tell us by somehow on the spot. Coming up with basically, I want your reasons as to what's currently holding CTV ad spend back and if they could fit into a pie chart, that would be cool. So if it's like 100% of the reason is this or 50% of the reason is this, 50% of the reason is that that is blame pie, which is Ross is now just learning about live was currently holding the audience might.
- [04:53]
B
Might have liked the explainer.
- [04:54]
A
You know, for that good save was currently holding CTV ad spending from back from crossing this 50% Mark Ross.
- [05:02]
B
Okay, well, I'm going to say 40% each goes to ad loads and ad free viewing. So that's 80% of the total. So if you look at total like time spent with linear compared to total time spent with ctv, they're very similar, like you just said, citing that Nielsen data. But on ad loads, see tv, linear TV is still the vast majority, like over two thirds, probably closer to 4/5 of the total ad load delivery. Because linear TV is 15 minutes of ads per hour. Everyone gets ads. You know, CTV depending on the service could be a few minutes to maybe 10 minutes per hour. Large portions of people not on ad plans. So, you know, people just aren't getting as many ads even if it's being consumed as much. And that's probably a good thing for user experience. Those 15 minutes of ads per hour on every service you use, no matter what, it wouldn't be as popular as it is and people would probably abandon it for other stuff. And then the remaining like 20% or so I would say is a combination of like advertisers concerned about suitability and measurement issues. So like if you're on YouTube especially, there's a lot of different types of content your ad can appear against. Linear tv. You have a much more, you have much more precise control. Like you know the types of programs that are going to be on like CBS and ABC and Fox. You know, if you go on some of these online services, who knows like where your ad may be? Especially if you're buying through a third party programmatic in like a large aggregated way.
- [06:38]
A
All right, 40, 40, 20. Zach, how does that sound to you?
- [06:42]
C
Yeah, I think Ross hit on the head about ad load. For me, I'd say that's 50% of the reason. I think you've got much more eyeballs on CTV but just not being monetized. Whether it's people going through Netflix, Disney plus and ad free tiers there as well. Like the strong majority of CTV viewers are watch advertising video on demand as a portion of it. But that could just be one service or another. So there's a lot of different platforms they could use that don't have advertising. The second one is sports. I put 40% of it being towards sports. You have more sports that are migrating over to from traditional linear over to streaming. And sure you're going to see it be on dual platforms for now, both being on streaming platforms and linear channels. But as the years go on, we're going to see more and more events occur exclusively on that of streaming platforms.
- [07:43]
A
And those really quickly sports, the streaming of the sports viewers, the ones who are watching on streaming and the ones who are watching on linear. I think sports did overtake linear a year or two ago, but the shares, it's still kind of 60, 40. Right. It hasn't become like 90 10. So at that point we did cross that milestone. But there still are a lot of people who are watching tens of millions of people who are watching sports on linear.
- [08:10]
C
And we're hearing more and more examples of events that are going to be exclusive towards that streaming. It's Netflix or NFL plus. Or you're going to have more events that occur just on Peacock, examples of that nature too or those events to command much higher CPM and pricing too. And then 10% of it still goes to political team TV ad spending. So I think that's a really big one too. That political skews much more towards that traditional outlets than that of streaming or digital. We're going to see that shift. Very much so. But historically, yeah, I, I overlook the.
- [08:53]
B
Political because I think, you know, that's not on an annual basis necessarily but you're, you're totally right. Local tv, local old school TV is still like the mechanism for much of that spend.
- [09:07]
C
So political TV ads during election year account for 10% of traditional TV ad spending. If you look at traditional TV political ad spending, that still accounts for roughly 60% of total political ad spending. So like still the majority of political ad spending is occurring on traditional outlets. And that was as of 2024. And we have seen that share go from 68% of political ad spending going from traditional TV down to 57%. And I'm sure in our next forecast when we come out of 2026, that sure will continue to move over and go over towards CTV where you can target on the state and local level as well, make smarter choices. What's your charge there?
- [09:57]
A
Sounds good to me. Yeah, some really good pie charts there. Some really good reasons as to what's holding CTV ads being back. That said, we do expect CTV ad spending to reach 50% of all TV ad spend by 2027. So it's in a couple of years. So TV ad spend still 12% of total US media ad spending. That is $50 billion. There's still a lot of dollars there. I want to ask the gents about out of Home and Prince, but I'll quickly tell you the radio part of traditional media because still $10 billion still goes towards radio ads in America. Armor Sir Jones writing that radio maintained a 64% share of total time spent listening to audio. Sorry, ad supported audio head of podcasts 19% AD supported streaming audio 14% in AD supported satellite radio with just 3. Why is radio still holding its own? Because it still has the audience size. 66% of list of drivers listen to AM FM radio. It's over three times as many who listen to music library streaming like Spotify at 20% according to Audacy. However, Marissa does point out that there's a growing relevance of podcast ads, saying they maintain high penetration across key demographics and are effective at driving action. She points to nearly nine in 10Americans taking some action after hearing a podcast ad and 4 in 10 having made a purchase from a brand advertised on a podcast. But radio still very much holding its own because when you get in the car, that's a lot of the time what people are listening to and still a lot of people drive. So that's the radio piece. Wanted to get through that quickly because it's still kind of the same old story but still a very important part of traditional media. Now out of home just over $9 billion go to out of home ads in the U.S. nearly as many as radio. Our scene director of briefings, Jeremy Goldman, writes that out of Home advertising is experiencing a renewed sense of purpose as marketers reevaluate their media priorities and question if being performance obsessed is the best strategy. Out of Home is certainly trying to innovate. An Adweek piece from Katherine Ludstrom points to video ads on gas pumps, which led to 12% more foot traffic into Applebee's restaurants, according to a GSTV and IPG IPGS Manga. Robert Clara of the same publication points to out of home examples this summer where NYX owned Shmushy. It's hard to say use scratch and sniff billboards to promote its lip balm sense as well as Celine Gomez's rare beauty company doing the same. Zach, I'll start with you. What's primarily responsible for driving the near 3% growth in out of home ad spending this year?
- [12:42]
C
America yeah, so I think the first thing to mention 2025 is a non cyclical year, so even this 3% is some of a deceleration. But what we are primarily seeing in the outdoor space right now is growth from digital out of home. A lot of that is being propped up right now by programmatic ad spending too. Oaaa, the agency that covers outdoor advertising has quantified that coming from that being a major growth factor there as well. So a few points of why ProgramMac is leading to incremental ad spending is because it helps advertisers be able to track their measurement a little bit better. ROI becomes measurable and they'll lead to more ad dollars flowing in, at least a higher efficiency, lower wasted inventory as well, and helps advertisers be able to shift their budgets from underperforming screens to better ones rather quickly. Lastly, I also want to talk about who is leading that growth this year. OA mentioned that tech and direct to consumer brands have been some of the real growth engines and some of the heaviest investment has been from players like Apple, Amazon, HBO and Netflix who are some of the biggest advertisers driving digital growth, but they're leaning on out of home as well to really continue to lean in on their brand storytelling and awareness.
- [14:13]
A
Ross, how about for you?
- [14:15]
B
Well, digital is the growth for sure now to home, but it's still primarily a traditional medium and maybe not so much for like this next year that we're talking about, but if I just look at it in general over the course of the last five years, something that's really helped stabilize that industry as it Underwent change is the strength of billboards now. Billboards have like always been the most common form of outdoor advertising, more so than like play space or transit, you know, any of these other categories. But their share of total out of home spending has grown since the pandemic and it's pretty steady. And you know, most out of home is still traditional. So like the meat and potatoes of this industry is still old school billboards because not everywhere in the United States or the rest of the world for that matter is, you know, dense like New York or London. It's, you know, it doesn't always make sense to have digital signage everywhere. And that, that traditional side, while it's shrinking, it's held up much better than like print advertising or traditional television has, which have seen, you know, pretty steep free falls in the last decade. So it's been a pretty resilient form of advertising. Even if the growth is coming from the digital side.
- [15:29]
C
Yeah, it has been relatively stable in terms of growth for traditional. But if we do look at digital out of home back in 2020, digital out of home only made up 26% of that whole.
- [15:41]
B
Well, in 2020 is when everyone. And digital got hurt the worst too because it was the easiest to pull out. You can't rip a billboard off the wall, but you can turn your, your sign off about office kiosk, I was gonna say.
- [15:53]
C
But then this year we're gonna see that it's gonna reach 36%. The penetration has moved 10% points more towards digital in the last five years. So yes, traditional is maintaining its gains. It's not hemorrhaging like print. But we are seeing the additional incremental ad dollars coming from the digital side. And as a lot of our reports talk about as well, we'll see more in store retail media too, as the gas station TVs and other digital space and in store outlets.
- [16:30]
A
Next stop, print publications turn to old style products to appeal to readers and stand out in digital media landscapes, writes Alexandra Braille of the Wall Street Journal. She explains that when the Onions new Own acquired the satirical publication a year ago, they bet on a dying breed print subscribers. And it is working. Ms. Bruell notes that the publication has a new deal to sell its papers at Barnes and Noble and is expecting about $6 million in revenue this year, up from a little under 2 million in early 2024. The chief executive, Ben Collins, aims to turn a profit next year. There are plenty of examples of media companies firing up the presses again. The Journal article points to publications such as Complex High Times and Tablet that have rolled out print editions in recent years to stand out in a digital content space crowded with creators, videos and podcasts. The Economist points to Playboy's new annual edition, Life magazine relaunching fortnightly print editions. NME and many others releasing print editions after several years as digital only titles. Ross, in spite of this print advertising, which is about five and a half billion dollar ad business today, it's not nothing will get cut by 40% by 2029, according to our forecasting team. Ross, can these prints, new print initiatives stem the bleeding?
- [18:01]
B
No, they can't stem the bleeding. They're nice niche operations that are good for those particular businesses and good for getting those brands noticed. Because you know, print is pretty great that even if you're not buying it, you're seeing that journalism brand front and center. Like think of the old school, like newsstands. Like even if you didn't buy Time magazine, you would see it as you're walking by it. So there's, there's value in print and having it out there in the world, but I don't think it's going to be a direct money maker. This, you know, these initiatives are nice for these companies but like the industry trend is still going to be what it is and that's downward.
- [18:42]
A
Zach agree.
- [18:43]
C
Yeah, wholeheartedly agree with Ross there. It's niche. You're seeing the entire distribution infrastructure that made print viable. It's collapsed over the years too. A loss of newsstand distributors, grocery stores of fewer and fewer rack space and postal rates have also gone up to the point where subscriptions are printing papers gone up too? Yep, inflation going up. So don't find there to be a really efficient way to deliver at the same scale that used to be at. But when we talk about Playboy relaunching, I don't think it's crazy to think that. Sorry. I don't think it's crazy to think that Playboy could benefit from the tightening net on digital adult content considering that over 40% of Americans now live in states that require age verification for pornography. I think that you are going to see print adult magazines maybe take off again. No, there won't be much advertising coming from that space, but it gives people a sense of anonymous and a sense of refuge as well. So just interesting, maybe for the old.
- [20:01]
B
Viewers, I feel like the younger ones will just get more savvy with their vpn.
- [20:05]
C
Yeah, yeah. Until those are banned and you'll get.
- [20:09]
B
Ban and vpn, that, that would be crazy.
- [20:12]
A
That's what we got time for. For this episode. Thank you so much to my guests. Thank you to Ross.
- [20:16]
B
Thanks, Marcus.
- [20:17]
A
Yes, sir. And to Zach.
- [20:19]
C
Appreciate you having me on.
- [20:20]
A
Absolutely, mate. And thanks to the whole edging crew, as always. And to everyone for listening to behind the Numbers Lean Marketer video podcast made possible by Fetch Rewards. Make sure you subscribe and follow and leave a rating and review if you can. Rob will be here tomorrow to host the Banking and Payment show, discussing the younger generation's new American dream.