How ad spend decreases for traditional media
The emergence of social media of communication has challenged traditional media to the point of threatening its very existence. The jury is still out on who wins this war but the dropping revenue of traditional media outlets, especially the print media points to perceived victory for social media.
In the early days of the emergence of new media as a whole, many social commentators and watchers of event in the industry had argued there will be a diminishing potential and influence for the traditional media but they were quickly drowned by the seemingly strong argument anchored on history, which suggested that the two would compliment each other.
Those who advanced this view had reasoned that since the emergence of electronic media complimented, rather than diminishes the influence of the print, it was bound to be the case with the new media.
But it is increasingly not turning out this way. The capacity of the new media to combine the features and functions of the traditional media appears to have been tilting the balance in favour of the former. Online media are delivering audiovisual capabilities as well as the written words. Worse for the traditional media, this channel is fast, almost instantaneous, cheaper and with very low entry requirements with capacity to reach a lot more people than ever before.
For these and more reasons, marketers are following the scent. Their business is to sample their wares wherever there is a large gathering of potential consumers. It also provides them with more options and increasingly at lower costs that the traditional media.
According to a survey done by MDG Advertising, advertisers always go where consumers go, and the world of social media is no different. Nearly every area of business has been disrupted by social media’s rise. Over the past several years, what began, as a space for people to gather and connect has become an ideal landscape for advertisers.
The impact of social media on advertising is part of a larger shift: consumers are moving away from traditional channels and toward digital channels. Advertisers are also decreasing ad spend when it comes to print media. Ad spending for magazines is down to 11 percent, and only six per cent of spend is being allocated to newspapers. Radio and out-of-home spending, however, remain steady at four per cent and two per cent, respectively.
But what advertisers are gaining for spending less on new media advertising appear to amount to losses in terms of engagement and integrity of campaigns. A dipstick survey of a number of consumers say that 65 percent think traditional media advertising messages are more engaging than the online versions. Another 73 per cent say they recall traditional media campaigns more than the online ads.
An additional 58 per cent claim they find traditional media adverts a lot less intrusive than those placed online. With ad blockers and the tendency to gloss of over online ads, what this survey suggests is that a lot more messages are lost online than in the traditional media, which extracts greater peripheral attention than those online.
If this is so, why are advertisers moving online in droves with all the benefits the traditional media has to offer? Some reports have suggested that over the next five years, Chief Marketing Officers are expected to raise their social media spend by a significant 71 percent. The answer to the question lies in the consumption habits of people. The spread of the internet and the adoption of Smartphone technology has migrated a lot of people to the digital plane. What this has done is create a convergence that has made people to sork, play, socialise and consummate transactions using one device – their phones and tablets.
CEO Leo Bunnet, Chukwuemeka Obia said the drop in revenue generation of the traditional media was due to the change in the landscape as a result of mobile penetration driven by cost of the smartphones dropping by the day, which makes accessibility affordability competitive.
“In the past, marketing used to be about distribution and putting your products in the right place. But now the landscape has changed and its all about innovation and experiences that consumers have, through which their expectations rises.”
Nevertheless, he said the traditional media remains relevant as it helps the brands to build credibility and establish status. Saying, “People today are drawn to brands because the brands are relating with them as humans and not consumers. It’s about connecting to the consumer on personal level. The traditional media is not going obsolete but it is important for it to realize that to speak to the new media consumer, it must think from a 360 degrees perspective on how best to reach the consumer.”
In terms of how many percentage of advertisement goes to the new media as against the traditional media, he said it was difficult to say, as it is dependent on the demography of the consumer.
But for people like Idiare Atimomo, CEO, Up In The Sky advertising agency, social media has not affected the revenue of the traditional media, as the people who advertise on social media are those who cannot afford the traditional mediums.
He said, “Social media allows you to do much cheaper advertising and usually without going through an agency. The only difference is that clients who before would only do traditional media marketing now do social media marketing as well, but they are definitely not spending more on social media adverts, but for the fact that it is much more engaging and easier to track result.
“The reason people spend less in traditional medium is the high cost and its inability to track success. I don’t believe that the social media has taken over the business of the traditional media but the question remains, how can the traditional media innovate to remain relevant?”
Reacting to how impactful social media adverts are compared to the ones on traditional media, brand analyst, Ikem Okuhu said, “The major advantage the social media advert has over those of the traditional media is cost.
It’s a lot cheaper. Some of them are designed for the media channel to be compensated based on the “clicks.” But in terms of visual engagement and attention span, the traditional weighs far higher. With ad blockers, you can even avoid online ads totally. But that’s not the case with the traditional media. You must watch or view. It do any matter if you are paying less attention, you are paying attention all the same.”
Okuhu advised that for traditional media to remain in business, they must look at entry costs and editorial engagements. Saying, “For most advertiser’s, especially in Nigeria, the cost is quite high relative to circulation numbers. This has to be looked at. The advertiser is looking at his cost per thousand eyeballs and when this doesn’t make sense, he moves across the table.
Advertising is all about the number of people to be potentially reached. If this is not matched well and fairly against the cost per unit exposure, there is a problem.”
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