The effective utilization of TV commercials in the age of CTV from a data analytics perspective
Consumers continue to display shifts in the media they use, and an understanding of these shifts is a must in marketing communications which use media. INTAGE holds regular online seminars (media trend seminars) to enable clients to catch up on these shifts in consumer media usage. This article will focus on TV broadcasting by rehashing our “Consumer Media Usage Trends as Seen from Log Data (Wave 3) – Why Consumers Watch TV Programs – The Effective Utilization of TV Commercials in the Age of CTV” media trend seminar hosted on December 12 2023 to consider how TV commercials can be effectively utilized in the age of CTV from a data perspective.
Streamed video viewing on one’s TV screen goes mainstream
The promulgation of connected TV (CVT) where TVs are connected to the internet – such as smart TVs and streaming devices – has been a major change in TV over the past few years. According to INTAGE research, the CTV ownership rate is rising yearly, reaching 42.3% in 2023. This increase was particularly marked during the covid crisis in 2020 ~ 2022, with covid clearly accelerating the promulgation of CTV.
Fig.1
TVs connected to the internet are characterized as not only enabling viewers to watch conventional TV broadcasts, but also viewing video streaming services via the internet. Diagram 2 depicts the shifts in viewing hours of TV broadcasts, video streaming, and other media (such as video viewing and game device usage) on TV screens obtained by analyzing the data from approximately 2 million smart TVs. The volume of video streaming viewing on smart TVs has increased annually, and reached 30% in July – September, 2023. At the same time, while TV broadcast viewing increased in January ~ March, 2020 with the advent of the covid crisis, it has since once again returned to a downward trend, to less than half viewers’ TV screen usage time in July ~ September, 2023.
Fig.2
The occurrence of these sorts of shifts due to the promulgation of CTVs means that we not only need to consider ad deployment for video streaming, but change the way we use TV commercials as well. In our seminar, we discussed the effective utilization of TV commercials in the age of CTVs from three perspectives: the aging of viewers, morning TV viewing, and TV broadcasting as a unique event.
Taking advantage of the aging of TV viewers
The first perspective is the aging of TV broadcast viewers. Fig.3 depicts Japan’s population in total as well as the TV broadcast heavy user segment (those who view it more than 4 hours a day) by gender and age group composition. The TV broadcast heavy user segment clearly possesses a bias towards seniors and women compared to Japan’s population in total. This tendency has further progressed from 2016 to 2023. The promulgation of video streaming services can be said to be accelerating young peoples’ shift away from TV broadcasts all the more.
Fig.3
The aging of TV viewers is deemed an issue for the TV industry, with an increasing emphasis on the need to create programs for younger viewers focusing on “core viewing rates” (the viewing rates of individuals 13 ~ 49 years old). While reaching young people is certainly important from an LTV (*Life Time Value, the total value a customer brings to a company over their entire life cycle) and brand switch perspective, if TV commercials are appropriately utilized, it may also be possible to leverage the merit of seniors being easy to reach. Diagram 4 depicts spending on purchases by gender and age group, with confectionary and frozen foods as the example in this case. Over 35% of spending on confectionary, and over 40% of spending on frozen foods is by women in their 50s ~ 70s, overlapping with the TV heavy user segment depicted in Fig.3.
In our seminar, we introduced Harmek, a media company targeting seniors as a best-in-class example, to discuss the utilization of TV commercials that leverage seniors. We also introduced data from the copywriter/media consultant Osamu Sakai who appeared as a guest speaker indicating broadcasters who kept some distance from “core viewing rates” displayed relatively little declines in ratings and broadcasting revenue.
Fig.4
Effectively utilizing morning TV viewing
The second perspective in the effective utilization of TV commercials in the age of CTVs is morning TV viewing. Fig.5 depicts TV broadcast and video streaming exposure rates on smart TVs by weekdays/weekends and time of day. Exposure to video streaming tends to be higher at night and on weekdays, yet low on weekday mornings.
In our seminar we discussed the need for TV commercials that are “easy to view of a morning”, such as ad creatives that are memorable even when exposed to only audially during busy times.
Fig.5
TV broadcasting as an event
The third perspective in the effective utilization of TV commercials in the age of CTVs is TV broadcasting as an event. Fig.6 depicts the average exposure rates to major sporting events. While consumers are said to be moving away from TV, major sporting events etc. are able to reach an extremely large number of people at once, such as over 20% nationwide on average with the World Cup and over 30% with the WBC. These sorts of major events are also characterized by the regional differences in exposure rates they display. Exposure rates greatly exceed the nationwide average in Iwate Prefecture with the WBC in which Shohei Otani, the baseballer originally from Iwate Prefecture, played outstandingly, as well as in Akita Prefecture, which is renowned as an area basketball thrives in with the Basketball World Cup.
In our seminar, we introduced an independent INTAGE survey comparing the effects of sports sponsorship and TV commercials. Among men, the younger the segment, the more effective sports sponsorship was, and among women, the younger the segment, the more effective TV commercials were, indicating the two need to be differentiated between in line with the targets.
Fig.6
The increased sophistication of TV viewing data
At the end of the seminar, we discussed changes in marketing activities due to the evolution of data to enable a deeper, quicker understanding of viewers and the effects of advertising. Since the concept of a “small mass” was first mentioned in TV marketing, outlooks have changed from the conventional idea of “rough planning being sufficient for TV” to a focus on utilizing data to increase targeting efficiency and effectiveness.
At the same time, the issue of production aimed at the “mass” with the greatest common denominator in mind being the mainstay on the ground with program production was raised. However, the increasing fragmentation of viewers due to the promulgation of video streaming is also a shift that will make it easier to target specific niche segments for the broadcasting industry. These changes will mean that selecting media tailored to the target and measuring its effectiveness will become more important in future. In order to engage in effective planning in limited time frames, a holistic view of consumer media usage trends and a methodology to enable one to deeply understand one’s targets will be musts. In future seminars, we would like to share consumer media usage trends necessary for planning, including media other than TV.
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