"Сценарий хаоса". Боб Гарфилд о будущем различных видов медиа (прогноз)

BOB GARFIELD'S 'CHAOS SCENARIO'

A Look at the Marketing Industry's Coming Disaster

WAZZAP? 2005 keynote speaker, legendary advertising critic BOB GARFIELD forecasts the future of media. (shortened version of the article from Advertising Age)

Downward spiral

According to Nielsen, network TV audience has eroded an average of 2% a year for a decade, although in the same period the U.S. population increased by 30 million.

In the last sweeps period, for the first time, cable commanded a larger audience than broadcast.

The cost of reaching 1,000 households in prime time has jumped from $7.64 in 1994 to $19.85 in 2004.

A 2000 Veronis Suhler Stevenson survey showed that Americans devoted an average of 866 hours to broadcast TV annually and 107 to the Internet, a ratio of 8:1. The projection for 2005 had the TV/Internet ratio at 785 hours to 200, or just under 4:1.

U.S. household broadband penetration has gone from 8% in March 2000 to an estimated 56% in March of this year, according to Nielsen/NetRatings.

Five percent of U.S. homes are equipped with TiVo or other digital video recorders, and not only does time-shifting of favorite programs render network schedules irrelevant, 70% of DVR users skip past TV commercials.

There’s been research that real cost of obtaining 30 seconds of the consumer’s attention is the same in 2005 as it was before the invention of television.

Fraying rope                                                     

“I still love and enjoy TV and believe it is very effective for advertisers,” says Association of National Advertisers President Bob Liodice. “But we’re killing it. We’re gradually killing it with cost increases, the level of clutter, the quality of the creative that is out there.”

“How can they continue to ask for more and more for fewer and fewer faces?” asks Geoffrey Frost, chief marketing officer of Motorola. “I don’t believe that is sustainable. I believe there will be disruption. There’s already disruption.”

“The industry’s key currency is basically reach, frequency, exposure and cost per thousand,” says Rishad Tobaccowala, president of Internet media shop Starcom IP. “I’m not saying whether it’s right or wrong but that’s currently the currency. And where the currency ought to be is about outcomes, engagement and effectiveness. Because right now all I’m doing is I’m measuring how cheaply or how expensively I’m buying the pig. I’m not figuring out whether the hot dog tastes good.”

None of this is lost on any sentient being in the media and marketing business. Any lingering denial most likely evaporated when Procter & Gamble Global Marketing Officer Jim Stengel -- he of the $5.5 billion marketing budget -- faced agency heads a year ago at the American Association of Advertising Agencies’ Media Conference and declared the existing model “broken.”

Network TV spending went up in 2004, by 10.7%. According to Jack Myers Report, last year’s upfront market yielded a 15.4% increase across the four majors, and Mr. Myers projects a 4% increase for the top four in 2005. Yes: increase. There are many possible explanations for the phenomenon. One is habit; gigantic institutions tend not to rapidly adapt. Another is greed: the self-interest of the comfortably situated old guard to preserve the status quo. The third is supply and demand, upward pricing pressure from Viagra, et al, which engorged the marketplace with billions in new spending. The main factor, though, is that network TV audiences remain coveted, because -- shrinking though they are -- they represent the last vestige of mass media and marketing, or, as Motorola’s Mr. Frost calls it, “the last surviving conglomeration of human beings in the living room.”

Precisely, says David Poltrack, executive vice president of research at CBS, who sees incremental revenue opportunities in video-on-demand, but no end to the dominance of broadcast TV in the foreseeable future. “Unless the advertising community finds something to replace television advertising, I think the relative value of the top-quality inventory is always going to be appreciating relative to all the other options,” he says. “Unless someone can come up with a more effective way of introducing a new product than broad-based advertising exposure, I think that business is always going to be there."

Web proves it can outdraw TV

The Internet has also demonstrated its ability to outdraw TV. JibJab satirical animations have been downloaded by the millions, for instance. And even TV programming has drawn better online than in its native habitat -- such as when comedian Jon Stewart went on CNN’s Crossfire to assassinate Tucker Carlson live on cable.

“That episode got, what, 400,000 viewers maybe on big old powerful CNN?” says Jeff Jarvis, president of Advance.net, the online arm of Advance Publications, and author of the media blog BuzzMachine.com. “Well that same segment was copied onto the Internet, where it got at least 5 million views. So what’s more powerful, the network CNN owns or the network no one owns? So now suddenly the distribution is exploded. Now on the Internet we can all swim in the same pool as content created by, you know, Universal or Disney. The tools are cheap and easy.”

It is a beautiful thing: the total democratization of media, combined with the total addressability of marketing communications. We, the people, cease to be demographics. We become individuals again.

Straight-to-Internet campaigns

On the advertising side, Google last year generated $3 billion in revenue, about the same as The New York Times Co. No surprise that Vonage, the Internet telephony carrier, is using the Internet to find subscribers, but Procter & Gamble put its money where Jim Stengel’s mouth is by launching Prilosec OTC with 75% of its budget allocated off TV. American Express allocates 80% of its budget off the airwaves. The new Pepsi One campaign will use no TV whatsoever. (Not Capital One. Not Purina One. Pepsi One.) In the new-media laboratory called South Korea, where universal broadband is social policy and its penetration exceeds 80%, the Internet’s share of ad spending is twice that of the U.S. TV, meanwhile, accounts for only 34.4%.

In the wake of BMW films, such diverse U.S. marketers as Amex, Burger King, Lincoln-Mercury and Motorola have created an ever-expanding universe of content/advertising hybrids, Webisodic short films to reach younger prospects online. Mercury’s “The Lucky Ones” is so barren of product and brand messages it is scarcely advertising at all.

Netcasting, of course, also delivers pure programming, too. From the top down was the streaming, on Yahoo, of Kirstie Allie’s new show, Fat Actress. From the bottom up, video logs -- or vlogs -- like Dylan Verdi’s are being generated every day. At Rocketboom.com, chirpy, irreverent host Amanda Congdon delivers oddball news and snarky observations in a primitive studio (or maybe a one-bedroom). At J.D. Lasica’s alpha Web site Ourmedia.com, citizen journalists and producers post their own news reports, animations, music videos and whatever else amuses them free of charge.

And the world will rejoice, happily awash in electrons. But before the liberte, fraternite and egalite, beware. This is revolution, and first we will be awash in the blood of the old guard.