16/05/2019

With TV advertising, you get what you pay for

If you are a TV advertising nerd like me, the wealth of new addressable opportunities brought about by technological advancements and changes in viewer behaviour are incredibly exciting. However, advertisers and broadcasters must not forget one of the great powers of traditional broadcast TV: peacocking. Peacocking is when someone dresses ostentatiously to impress a potential romantic partner, and it applies to advertising too – particularly with mass media channels like TV.

When companies spend large sums of money on elaborate creatives and then place them into premium programmes at great expense, they signal their faith in their own brand, and their ability and willingness to invest in it. This legitimises the advertiser in the eyes of the viewer because only successful, confident brands can afford to do this.

Rory Sutherland, Vice Chairman of Ogilvy UK and general behavioural science legend, uses the extended metaphor of a wedding to explain the nuances of this effect. First, he talks about the engagement ring. It is an extravagant expense, which signals the buyer’s long-term investment in their relationship. You wouldn’t splash three month’s salary on a ring if you didn’t fully believe the marriage has legs!

Second, he talks about the invitation: no one sends wedding invitations by email, because everyone would just think it’s going to be an awful wedding. Instead, you spend lots of money on expensive card and beautiful calligraphy to let all your nearest and dearest know it will be a special event that’s worth attending. It would be far more cost-efficient to send an email, but it wouldn’t be nearly as effective.

And finally, there’s the ceremony itself. When you exchange vows with your betrothed, you do it in front of all your friends and family at the same time, including your Dad’s weird mate who always made you call him uncle for some reason. This public declaration of your commitment to each other is important, because everyone attending knows that everyone else attending also knows it. It would seem hollow and unconvincing if someone made their wedding vows over the phone to each family member or friend individually, but there’s nowhere to hide after professing your undying love in front of a packed out church.

So how can we ensure that in a hyper-fragmented and non-linear future, we can still generate the costly signalling opportunities that TV advertising has provided for decades? The two most obvious examples are appointment-to-view live moments, and cross-platform sponsorships.

I think we can safely say that sporting events will always be viewed live for obvious reasons, but broadcasters must ensure that they continue to offer traditional whole-network spots that provide a chance to communicate with a mass audience at once. On top of that, the unmissable shows that are influential cultural events (anyone heard of Game of Thrones?) should be considered the gold standard peacocking opportunity.

But perhaps more importantly, sponsorship should always remain one of the simplest ways of showing off, especially as it is possible to sponsor content holistically – on any platform or device that viewers choose to use. People instinctively feel more favourable towards the sponsor of their most-loved programme or channel, and it is also widely perceived as an expensive and premium type of advertising – which amplifies the peacocking effect.

Another less obvious avenue available to larger brands is long-form branded content or ad-funded programming – something that P&G’s chief brand officer Mark Pritchard believes could be the future of video advertising. Channel 4 has recently provided some examples of this in the TV space, partnering with the likes of Thomas Cook, Fly Emirates, and Age UK on some award-winning content.

But on the flip-side, if too much linear TV is bought as part of a hyper-targeted addressable solution, we might gain some efficiency but we will lose something far greater – the power that TV has to speak to the nation at once, and in doing so send a message: this is a premium brand, and we want you all to know it.

So this is a warning to both broadcasters and brands: advertising in TV’s biggest shows isn’t effective in spite of the cost, it’s effective because of it. Let’s not forget the power of peacocking.

by George MacKean, Investment Manager