It’s Now Or Never For TV: MCN Boss Anthony Fitzgerald

It’s Now Or Never For TV: MCN Boss Anthony Fitzgerald
SHARE
THIS



A much-discussed but never acted upon spirit of collaboration has to be embraced by all of Australia’s TV broadcasters if it is to survive MCN’s boss has warned.

Speaking at the Future Of TV Advertising Forum in Sydney this morning, MCN supremo Anthony Fitzgerald delivered a stellar keynote (read it in full at the bottom of this article) urging the networks to play nice with one another.

Unknown-14

Fitzgerald said it is the entire advertising ecosystem that must be willing to accept revolutionary change if TV is to survive. And that was from measurement to buying, all aspects of the TV world needs a radical overhaul, he argued.

“Whilst TV’s great legacy is that we have one currency that is dependable, accurate, trusted on both the buy and sell side, it is simply no longer adequate in the digital age to be relying on a 5,000 home panel and a bunch of demos to trade on,” he said.

“Now when I say reinvent it, we first have to be willing. All of us – networks, agencies and clients – to accept change.

“In fact, we have to be willing to obliterate our obsession with overnight ratings as a measure of commercial success, we have to be willing to obliterate our attachment to legacy metrics.

“We must establish confidence in campaign delivery. To achieve this, we need to reach agreement on the one currency structure for planning, buying and post analysis that is fit for purpose in the modern age.

“This must be resolved so televisions true value can be recognised, rather than the endless disagreements surrounding campaign delivery. 

“We need to also finally recognise and agree that demographics are, for the most part, losing relevance,” he said.

Read the speech in full below:

Good Morning Everyone,

For those of you that know me well, you would expect me to say this.

Whether it’s the big high-definition TV screen on our walls, which remains the premium in-home video experience, or the array of devices and screens at our fingertips, TV in all its forms remains incredibly strong.

The amount of time people are spending watching Broadcast and IP delivered TV content is greater than ever.

It’s true, that in the face of a decade of unceasing predictions about TV’s imminent death, the ad-supported television experience remains the powerhouse for capturing and converting consumer attention.

No question, lots of other mediums work but TV remains the King.

We have seen empirical proof of that from academics like Dr Peter Field in the UK, econometric studies from Ebiquity and the ground-breaking work that ThinkTV has done with Professor Karen Nelson-Field here in Australia – to much global acclaim.

But, if we allow the television advertising experience to wither, through ambivalence or negligence, there will NOT be another of its equivalent power and stature that will deliver the impact and business growth that television has done for decades.

We too easily forget that fact, in a sometimes misguided agenda for relentless innovation and disruption. And the daily hustle for cheaper commoditised pricing. To all our advertisers, the science is in.

You don’t need to concern yourselves about being seen as a “laggard” because you support a medium that grows your brands and business’s.

Leadership today is no longer about following everyone else but rather, applying a forensic focus on driving business results.

Driving REAL return on investment, not just the delivery of media metrics.

Obviously people’s media consumption is shifting and fracturing at break neck speed, particularly the young amongst us!

So, forget the TV narrative for a moment, the young folk are already restless, they are more fickle than ever and they’re moving around and even off the major social platforms.

But, in the face of proliferating video choice for consumers, the television advertising experience, wrapped around professional content, remains unquestionably the battlefield communications medium.

But, we are not protecting that very special thing.

As Mark Ritson said recently: “If TV ever does die, its assassins will struggle to find ways to promote their offerings once it’s gone.”

Television’s enduring strength is its ability to deliver unrivalled advertising impact and fast mass reach.

Even as much of the market froths over the opportunity for tighter targeting, which in many instances is a good thing – those very same companies are using the high-impact medium of television unashamedly.

Google, Facebook, Apple, Amazon.

All of them are on television being watched all over the world – Amazon just a few weeks ago with two spots in the Super Bowl. And just while we’re on the Super Bowl, I have to share with you my favourite ad. Actually, it’s so much more than just an ad.

It was a campaign in itself, just within the Super Bowl. One times 60 sec and three times 15 second spots seen by well over 100 million people.

Fantastic creative, broadcast inside a compelling professional content environment to an engaged audience. That equals unrivalled Impact.

For those of you that haven’t seen the full suite of ads it really is worth the time to take a look.

So, to protect this powerful brand and business building medium we must all align on new audience segmentation models and metrics to retain TV advertising’s unrivalled efficacy and we must align on systems for TV to be more efficient and easy to buy, sell and transact.

We need to work together to improve the viewer experience and we must understand the realities of professionally produced content economics.

The time for ongoing debate and rhetoric is over.

Let me remind you of a debate on this subject four years ago at the AdNews Media Summit.

Alarmingly, I am not sure we’ve achieved too much since then.

Even more disturbingly and somewhat ironically four year ago a radio executive, a very good radio executive, thanks Cath, advised us, that  if we just worked together we could achieve a lot, quickly!

However, four years down the track I remain eternally optimistic we can invent a prosperous future for the multiscreen TV advertising experience.

But, if we don’t take the challenges that exist today and in the future, with a profound sense of collective urgency, I fear we face ongoing declines. Or worse, a structural breakdown in the ad funded TV model.

Not tomorrow and not this year, not even the next.

But, the action we need to take together to head-off such a scenario IS now.

Let me be clear, this is absolutely beholden on the television industry to get its act together.

Of that there is no question.

And there is a lot of terrific work being undertaken by the team at the new Think TV led by Kim Portrate. But, we should have started five years ago. Or more.

And as an industry we need to do so much more than marketing and research.

Because if we are not careful we will have multiple systems competing in dynamic, programmatic and addressable TV, using different metrics, competing not just against the silicon valley interlopers, but with OURSELVES. And it’s all creating unnecessary systems duplication and complexity.

It will fracture the TV market further and will only serve to set our cause back.

Now I can’t stress this point strongly enough. The ramifications from an ongoing decline, in the advertising supported television market will not be quarantined just to the broadcasters.

This will hit the agency sector, advertisers AND BRANDS harder than you either currently realise or want to admit.

It will impact the local production and creative industries also.

Truthfully it has already started to.

Australian audiences love Australian dramas and content – it is by far the most popular genre on our screens today – but we are already seeing the economics of local content erode.

And ultimately it will impact broader society and culture, but that debate is for another day.

For all of us here, we must collectively act fast.

To my favourite quote from the former CEO of GE, Jack Welsh.

“If the rate of change outside a business is greater than the rate of change inside the business, the end is near!”

And I am absolutely certain of one thing. The rate of change we are currently experiencing will never be this slow again.

TV’s already compelling case will only advance dramatically in the very near future through the uptake of Programmatic TV, addressable IPTV and of course household addressable linear TV advertising, delivering true mass targeting.

Now, across the rest of today, you’re, no doubt, going to hear about the future of everything. What could be, what would be, what should be, what might be in television advertising.

And all that is going to create great debate. But, in my remaining time, I want to outline Five Action Points for all of us to act on NOW, TODAY.

To take what TV already does brilliantly and make it better.

I am convinced we must take action on these points as this will create the foundation to allow us not just adapt to the changing market but to lead it, and prosper in the face of great change.

I truly do remain as optimistic as ever, that television, in all its forms, can prosper and grow, if we just get out shit together and make a start.

So, we must reinvent and expand the television measurement system.

Whilst TV’s great legacy is that we have one currency that is dependable, accurate, trusted on both the buy and sell side. It is simply no longer adequate in the digital age to be relying on a 5,000 home panel and a bunch of demos to trade on.

Now when I say reinvent it, we first have to be willing.

All of us, networks, agencies and clients to accept change.

In fact, we have to be willing to obliterate our obsession with overnight ratings as a measure of commercial success, we have to be willing to obliterate our attachment to legacy metrics.

We must establish confidence in campaign delivery.

To achieve this, we need to reach agreement on the one currency structure for planning, buying and post analysis that is fit for purpose in the modern age.

This must be resolved so televisions true value can be recognized rather than the endless disagreements surrounding campaign delivery.

We need to also finally recognize and agree that demographics are, for the most part, losing relevance.

The reality is that the role of age and gender as the currency authority for media value is declining rapidly.

Now, I turn 54 next month which means that based on today’s key buying demo for TV people 25-54, I have just over one relevant year left to most advertisers in this country.

After that, I am no longer useful.

So, unfortunately for all of you, I am going to fight hard to fix that gross injustice, because I can assure all of our advertisers in the room here today, that I have plenty of good years ahead of me spending money. Funeral and pensioner insurance are not for this 55 year-old, nor hundreds of thousands like me. At least not yet!

We must reduce the number of basic demographics and replace the rest with an agreed set of consumer segments that are relevant and accepted as part of the TV trading currency for the future.

The second action is to remove the transactional impediments that exist in our industry.

We have to incentivise a single trading system for television, a single ID platform and possibly even a common viewing platform across all broadcasters.

At the expense of once again sounding like a broken record, for more than a decade we have been calling for the television industry to work together on these frontlines.

We haven’t yet, but now it really, really, is time.

We need a real sense of urgency.

Multiple and competing TV trading and audience platforms will fail to deliver the market scale and work flow efficiencies we need for both agencies and broadcasters.

We need start to develop this solution today and we need buyers and advertisers to back it all of us need to put down the cannons and collaborate.

Thirdly. We must surprise and delight the TV viewer, we must look to create a better viewer experience through reduced interruption and by extension create a better advertising experience.

Simply put, that means less ads in break and less ad breaks per program, to keep people inside advertising supported environments and improve the viewer experience.

But, will we be allowed to innovate?

Ironically, there has not been even a whisper of protest from advertisers or agencies about YouTube or Facebook’s move to institutionalise six-second ads.

So whilst the industry has wholeheartedly embraced the duopoly’s rationale to improve the “user experience” with shorter ad lengths and the massive effective rate hike that entails the market reaction to television taking such bold action would today, be outright carnage.

It would simply be viewed as an opportunity to slash pricing, reduce effective CPMs, cut overall commitments and limber up for another 15 rounds in the ring with the TV industry.

We need to rethink the way we trade what is precious consumer attention that is delivered through ad -supported TV.

Attention will become the ultimate currency in our new consumer economy but we must first respect how precious and valuable it is.

It can no longer be exploited and commoditised to the point of destroying it, through an endless game of volume and price negotiations.

And Four. It is, of course, the content that engages the audience that grabs their attention.

So, there is no doubt we must continue to invest in compelling content.

But to do so, we all must truly understand the economics of brand safe, professionally produced broadcast quality content environments.

It’s simply insane to expect professional content producers in TV to match the video pricing regimes of user generated content platforms.

There is a reason YouTube trades its audiences at a serious discount to broadcast content.

It doesn’t cost them a dime. Most of it is of questionable or very poor quality and we are seeing incontestable evidence that there are enormous risks to brands, local content producers, local culture and even democracies.

This is why the FANGS wants to do deals with the broadcasters to carry more of their content, they need it.

But, the market must understand content economics.

YouTube and Facebook pricing regimes – and their suffocating partner terms – won’t sustain professional content.

It doesn’t sustain amateur content now.

We all know professional content works but it costs money.

We must bury our obsession with lowest-cost, commoditised pricing.

As Tom Denford, the Chief strategy Officer of ID Comms in London said recently “The narrative internally in lots of businesses is the shift from media as a commodity at lowest cost, to media as a lever for growth that drives a business outcome.”

The Australian television market truly is an enigma.

There is not another market like it – nowhere in the world does a TV market accept a ceiling on price and no floor, whether demand is white hot…..or only simmering.

Indeed, Australia is probably the only market where TV pricing has a limitless bottom and any potential blue sky is always brutally black.

All the major international markets remain fundamentally optimistic about the benefits that TV delivers to brands and business outcomes rather than being solely focussed on cost.

And it’s worth a quick reminder to you all – the overall Australian TV broadcast industry is not in runaway profits and expanding margins.

That is now the domain of Silicon Valley.

The immediate measurability of digital media – so often spurious – has built false expectations that the entire advertising world can now behave as one giant response driven, performance marketing machine.

Have we forgotten the fundamentals of how advertising, brand building and sales funnels work?

Have we forgotten how television works?

Television builds brands, customer consideration AND it converts.

We need to return to and redefine business value in a media context.

It’s not lowest price.

It’s appropriate pricing for a better quality impact, greater attention, better sales results and better overall business outcomes.

You know, it’s the strangest of days when the market at large will allow, and indeed encourages, test and learn thinking for the Silicon Valley interlopers, but aggressively resists and stymies attempts by the Australian television industry to do the same.

For over 50 years television has reinvented itself many times. And yet the way we trade and value TV advertising remains stubbornly buried in the last century.

The broadcast sector has much responsibility to take on this front but we are not alone.

The operating structures of many of our agency partners and the TV buying systems also require upgrading to realise the true value of Multi Screen TV Advertising.

I believe absolutely that the future is full of opportunity if we can just shake off the last 40 or 50 years of legacy systems, legacy thinking and legacy behaviours.

It must start today.

We need new conversations and bold action.

 

Latest News

Instagram Updates Its Shopping Tools
  • Marketing
  • Media

Instagram Updates Its Shopping Tools

Instagram has given its shopping tools a spring clean & polish. Hence, why this comes with a slight whiff of ammonia.

Blue Post Appoints Dave Hollingsworth As Director Of Post-Production
  • Media

Blue Post Appoints Dave Hollingsworth As Director Of Post-Production

Post-production facility Blue Post has expanded its team with the appointment of industry veteran Dave Hollingsworth as director of post-production. Hollingsworth’s appointment marks his return to Australia after 14 years working overseas with some of the world’s best directors, including Peter Jackson, Guillermo Del Toro, Steven Spielberg, Taika Waititi and Neill Blomkamp. Blue Post managing […]