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How has COVID impacted TV internationally in 2020, and what can you do about it

It’s no secret that the COVID pandemic has meant mixed outcomes for advertisers. When it comes to ATL media, TV viewership numbers have dramatically increased as consumers are increasingly at-home and prices have often dropped with lower demand – however financial uncertainty and logistical challenges caused by lockdowns may have impacted response or broader business metrics.

As we near the end of 2020, news of successful vaccinations is a light at the end of the tunnel for those who have lost out – but financial uncertainty is expected across the globe. With this in mind, how do you prepare to future-proof your business moving into 2021, part of which means getting the most of your media investment?

This week RTL Ad Connect shared their TV Key Facts presentation, focusing on international TV trends, how advertisers can interpret them, and advising advertisers on how to cope during potential recessions. Some key points they shared:

  • Linear broadcast TV remains key; looking at numbers for all individuals – linear TV remained @ 90% of time viewing in Italy, 87% in Spain and 83% in Germany. The UK, and the Netherlands (along with the US) lead the way for time-shifted and online video – with 29-35% online viewership.
  • We’re consuming more TV per day than ever. In 2019, the world average daily viewing time was 2 hours and 48 minutes. Highs in North America at 3 hours 40 minutes, similar in Europe at 3 hours 39 on average – but significantly higher in Germany, and just 2 hours 20 in Asia.
    • This year, viewership numbers were re-forecast based on in-year changing trends in viewership. The expected increase was up to 5 hours 51 in the US (9%) and 4.5 hours in the UK and Germany (14%).
  • The largest increase this year was in March but we’re set for another rebound in Q4. At the end of the curve, we see a clear rebound of TV consumption – and are set to see high numbers as we go into Q4, with lockdowns extended in many countries around the Christmas period.

  • The landscape of online and catch-up viewership has shifted back from mobile. Global numbers show a huge shift away from smartphones and tablets (with trends for the past few years often moving in the direction of mobile consumption), to ‘Connected TVs’, with total viewership forecasted to increase 12 million (M) year on year (YoY).
  • Most of the connected TV uplift is coming through subscription VOD – initial 2020 forecast showed 2020 growth of c. 13M for Netflix globally, taking COVID conditions into account the new number is 40.5M. The large players weren’t the only beneficiaries of changing trends, ‘Other’ services, initially forecasting growth of 4M, have doubled growth to a forecast +8M. However, RTL numbers also showed that 72% of consumers in the US and 77% of consumers in the UK would prefer to pay less and see ads, with RTL predicting an increase in advertising offerings for existing players and new challenger AVOD services, opening up opportunities for advertisers in the future.

Overall, some really positive trends for viewership, with some key areas of growth internationally.

For some of the beneficiaries of changing lockdown consumer habits, particularly in e-commerce (in the Netherlands for example, turnover for ‘pure’ internet sellers, with no retail presence was up 45% in Q2 YoY), this might be all you need to hear to increase TV investment and reap the rewards of increased reach, brand visibility and performance.

However, that might not mean much if your business has suffered through COVID and budgets have tightened. RTL covered some tips for these advertisers, quoting Marketing Professor Mark Ritson “Use the gift of history to come out of the recession better than you went in”.

History says: be on air. Examples cited included Kellogg’s – one of the most successful Cereal brands who became the number 1 cereal in the US during the great depression, Toyota who became the leading foreign car manufacturer in the US by maintaining TV campaigns throughout the oil recession, and Sainsbury’s in the UK who increased their market share by pushing their £5 meals during the last financial crisis. Keeping investment levels stable or higher whilst other competitors grow out simply means increased SOV and eventually share of the market (if you stay 10% above SOV of others, it will translate into +1% share of the market – termed as an excess share of voice). P&G took this approach throughout the pandemic, advised by their CFO and increased 2020 NET income by 5%.

RTL also covered off other lessons to advertisers for going forward – including the importance of low-frequency buyers (from broader awareness, able to drive volume) and high-frequency buyers in tandem (at activation phase, high conversion rate but in smaller numbers), more easily reached in periods of higher TV viewership, sharing the following Nielsen data.

Another key point as we move forward was that consumers are expecting higher levels of engagement advertisers when it comes to reaction to COVID (e.g. 66% of Spanish respondents expected advertisers to take direct action to fight the crisis, in Italy where the financial repercussions started earlier, 49% said advertisers should support the national economy, 75% of French respondents wanted brands to educate consumers to consume responsibly, 31% globally said they should at least help consumers in everyday life). Advertisers can benefit from listening to the needs of viewers to tailor their messaging.

All Response Media viewpoint

At ARM we know TV works, but we also know how essential it is to stay reactive and assess the market to make sure it keeps working well and benefits your business. Our advice to advertisers on how to approach TV internationally bearing in mind what we’re seeing in the market and RTL’s research.

  • Take advantage of high viewership and reach opportunities; TV will remain the largest ATL reach opportunity for the foreseeable future, but the level of TV viewership happening during lockdown is a unique opportunity. If your business is going well, take this opportunity to increase investment, reach consumers more easily and drive volume as well as performance.
  • Plan for the long-term and stay on air; research shows that maintaining market investments during financial uncertainty has big advantages, driving higher SOV and long-term brand success.
  • Be tactical about market opportunities; markets like Germany, Italy and Spain are seeing big jumps in viewership and are bought on a cost-per-spot basis (with pricing staying stable). Simply, in these markets, you can get more impact for your money now. When considering launching new markets, ARM can advise you on where to start.

Reacting tactically to tough market challenges will allow you to better future proof your business.

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